Watch These Key Recession Indicators Closely

Summary

In this video, Ken Fisher discusses the potential for a recession, emphasizing that it usually doesn't occur until the US and global stock markets experience a sustained decline of 3-4 months. He highlights the negative impact of President Trump's tariff policies, suggesting they could harm the economy if not resolved within the next 90 days. Fisher, despite being a longtime Republican donor, criticizes the trade policies, stating that tariffs are ultimately harmful to the imposing country. He urges viewers to monitor the situation closely over the coming months, as the outcome will significantly affect the stock market and the economy.

Takeaways

• 😀 Recessions are unlikely to happen until stock markets have peaked and declined for 3-4 months, which hasn’t occurred yet.
• 😀 Widespread fear of an economic downturn, if anticipated long in advance, often doesn't result in a recession because businesses can adjust over time.
• 😀 Despite concerns, the U.S. stock market hasn't dropped long enough to meet the conditions needed for a recession to start.
• 😀 President Trump's tariffs, especially his approach with China and other global trade partners, are viewed as damaging to both the U.S. and global economies.
• 😀 While Trump’s intentions with tariffs may be good, the actual outcomes are believed to be harmful to the country imposing them.
• 😀 Tariffs can help specific industries but generally harm the broader economy by creating uncertainty and discouraging investment.
• 😀 The administration's inconsistent approach to tariffs, such as pauses and reversals, creates confusion and hinders economic confidence.
• 😀 Fisher emphasizes that tariffs are always detrimental in the long term, especially when they're applied broadly and not for national security reasons.
• 😀 If the tariff situation doesn't resolve in the next 90 days, there’s a strong possibility of a recession before the year ends.
• 😀 Fisher critiques the Trump administration’s handling of trade issues, calling the lack of coordination between advisers akin to 'Amateur Hour' or 'The Three Stooges.'
• 😀 The future of the stock market largely depends on whether the administration successfully resolves trade issues or continues to destabilize it with tariff uncertainty.

Q & A

What is the main topic discussed in this video?

The video discusses the potential for a recession, focusing on factors such as the stock market, tariffs, and trade policies, particularly under President Trump's administration.

What does the speaker say about the relationship between stock market performance and recessions?

The speaker explains that a recession typically does not occur until the US and global stock markets peak from an all-time high and decline for three or four months. This is considered a minimum requirement before a recession can start.

Why does the speaker reject the idea that we are currently in a recession?

The speaker rejects the idea of a current recession, arguing that it would be unprecedented for a recession to start without the necessary decline in the stock market, which has not occurred yet. The US stock market only peaked in February, meaning a recession cannot begin before that three-to-four-month period.

What is the speaker’s stance on President Trump’s trade policies?

The speaker criticizes President Trump’s tariffs, arguing they are economically destructive both domestically and internationally. He believes that although the intentions may be good, the execution of these policies is fundamentally flawed and could lead to negative economic effects.

What does the speaker mean by the phrase 'Amateur Hour' in reference to the trade policies?

The speaker uses the phrase 'Amateur Hour' to describe the inconsistent and poorly coordinated nature of the Trump administration’s trade policies, especially the back-and-forth changes on tariffs, which create uncertainty for businesses and hinder economic stability.

What impact do tariffs have on businesses, according to the speaker?

The speaker argues that tariffs create uncertainty for businesses, leading them to delay decisions and investments out of fear of being impacted by unpredictable tariff changes. This results in a negative economic cycle that can potentially lead to a recession.

How does the speaker view the potential effects of the 90-day pause in tariffs?

The speaker views the 90-day pause as a critical period to observe whether the trade disputes will be resolved. If no significant progress is made during this time, the speaker predicts that the continued tariff uncertainties will likely lead to a recession.

What historical perspective does the speaker provide on tariffs?

The speaker highlights that tariffs have historically been harmful to the country imposing them, often causing more damage than the country they are aimed at. He argues that while tariffs might benefit certain industries, they come at a high cost to the broader economy.

What is the speaker’s opinion on tariffs being used as a tool for national security?

The speaker believes that tariffs should only be justified in cases related to national security. He criticizes the current administration for broadly applying the national security justification to tariffs that are unrelated to actual security concerns.

What does the speaker predict will happen if the administration continues its current approach to tariffs?

The speaker predicts that if the current approach to tariffs continues without substantial negotiation or resolution, it will lead to a recession, as the economic uncertainty caused by the back-and-forth changes would hurt business confidence and growth.