The David Lin Report
Buckle Up For ‘Tough 2025’ Warns Moody’s Chief Economist: Markets Not Pricing In What’s Next
May 2, 2025
Mark Zandi, Chief Economist at Moody's Analytics, shares his insights on the looming global recession expected in 2025. He discusses how trade tensions and tariffs could impact sectors, corporate earnings, and consumer demand. Zandi warns about overvaluation in equity markets and the potential fallout from economic corrections. He also explores the implications of a new income tax proposal as a response to rising costs. Finally, he addresses the surprising decline of the U.S. dollar and its effects on global investments.
22:00
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Quick takeaways
- Mark Zandi emphasizes the high risk of a global recession in 2025 due to ongoing trade tensions and tariffs impacting various sectors.
- The podcast highlights concerns about equity market overvaluation as it may not fully account for a potential economic downturn.
Deep dives
Recession Outlook and Economic Predictions
The likelihood of a global recession starting within the year is estimated to be over 50%. Factors contributing to this outlook include ongoing tariffs and trade wars, which have diminished near-term growth prospects for the economy. If these tariffs remain in place without any de-escalation, the uncertainty they create could severely impact consumer confidence and economic performance. As economic conditions worsen, some market segments could experience declines of 10% to 30% from their peaks.
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