Is Recession on the Horizon?

Mar 14, 2025

Kevin Gordon, Key Research Associate and Senior Investment Strategist, brings his expertise to discuss the looming recession concerns. The conversation highlights contrasts between bearish investor sentiment and resilient consumer behavior. They dive into the implications of labor market dynamics and recent earnings challenges, emphasizing the uncertainty business leaders face. Gordon also touches on key economic indicators to monitor, including retail sales and upcoming Federal Reserve decisions, making it a crucial listen for anyone tracking the economy.

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INSIGHT

Bearish Sentiment Without Sell-Off

Investor sentiment shows increased bearish attitudes not yet reflected in behavior like equity exposure.
Attitudinal bearishness is high but fund flows and equity investments remain near all-time highs.

INSIGHT

Consumer Spending Signals Lag Recession

Consumers are still spending, especially high earners, keeping the economy afloat for now.
Softening consumption among lower income groups and hiring slowdowns could lead to a recession in 2026.

ANECDOTE

Personal Pandemic Memories

Kathy was on spring break vacation as COVID lockdowns began, experiencing both fear and calm.
Liz Ann had to pack a home alone due to movers canceling during the pandemic's onset.

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In this episode, Liz Ann Sonders and Kathy Jones discuss the current sentiment in the market, contrasting consumer sentiment with investor sentiment amid economic uncertainty. They explore the implications of bearish investor attitudes and the potential for a recession and reflect on the anniversary of the COVID-19 pandemic's impact on the economy. The conversation also highlights key economic indicators to watch in the coming week, including retail sales and Fed decisions.

Then, Liz Ann speaks with Kevin Gordon about the overall economic landscape, focusing on recession indicators, labor market dynamics, and the recent earnings season. They explore the implications of tariff policies on business confidence and the challenges companies face in providing guidance, given the uncertainty.

Kathy and Liz Ann also discuss the data and economic indicators they will be watching in the coming week, including the upcoming FOMC meeting.

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