Moody's Analytics' chief economist Mark Zandi cautions that a recession may be on the horizon. In an interview with CNBC's Andrea Miller, Zandi said a recession did not occur in the first half of this year. Zandi called employment levels the "most important indicator[s]" of a recession. With unemployment at the low rate of 3.5%, he doesn't buy the view that two back-to-back quarters of negative growth alone are sufficient to make for a recession. But Zandi did warn that he expects layoffs to increase in the days ahead. "With this kind of low unemployment, inflation’s going to remain a problem," he said, and to address that the Federal Reserve has signaled it will continue to raise interest rates in an attempt to slow down the job market. Zandi attributed the confusion about whether the U.S. experienced a recession in the first half of this year to the coronavirus pandemic and the Russian invasion of Ukraine. "These two massive supply shocks have hit the economy at roughly the same time," Zandi said, which makes interpreting the data about the economy particularly challenging. The Moody's chief economist said that if rising prices don't ebb “the only way to get rid of that persistent stubborn inflation would be to push the economy into a recession.” If there is a recession, Zandi said it "probably won’t happen until the second half of 2023." As to preparing for a downturn, Zandi said Americans should "spend, save, invest in the same way that they typically do," but to remain cautious. “Americans don’t need to run for the bunkers,” he said. “But maybe keep one hand on the bunker door just to be safe and sound.” Watch the full interview in the video above. » Subscribe to CNBC: » Subscribe to CNBC TV: About CNBC: From 'Wall Street' to 'Main Street' to award winning original documentaries and Reality TV series, CNBC has you covered. Experience special sneak peeks of your favorite shows, exclusive video and more. Connect with CNBC News Online Get the latest news: Follow CNBC on LinkedIn: Follow CNBC News on Facebook: Follow CNBC News on Twitter: Follow CNBC News on Instagram: #CNBC What Broke U.S. Recession Indicators | Mark Zandi...(read more)
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Mark Zandi, the chief economist of Moody's Analytics, recently stated that the typical indicators that signal an upcoming recession in the United States have broken down. The traditional indicators that have been reliable for forecasting recessions in the past are no longer working as they have in the past. This shift in the economic indicators has many experts asking why. One explanation for the sudden shift in the recession indicators could be the lingering impact of the financial crisis of 2008. This financial crisis sparked a transformation in the global financial system, resulting in new regulations and financial management strategies. This shift in the financial landscape could have contributed to the alterations in the traditional recession indicators. Another possible explanation is the concept of the “new normal” economy. After the financial crisis, the economy did not rebound in the same way as it has following previous economic downturns. Instead, the economy has experienced a slower, more steady recovery with lower growth rates. With this new normal in place, it is possible that the traditional recession indicators simply no longer apply. There may also be demographic factors at play. For example, the aging workforce in the United States has resulted in a decrease in the number of people looking for work. This means that fewer people are actively seeking employment, which influences the overall state of the economy. Additionally, the gig economy - where individuals work part-time or freelance jobs instead of full-time positions - has changed the way Americans work and earn money. This shift has made it more challenging to predict how the economy will react to changes and what traditional measures are no longer relevant. Whatever the cause, the fact remains that the recession indicators that were once reliable for forecasting a U.S. economic downturn no longer work in their traditional form. Economists like Zandi are now on the lookout for new indicators that will signal economic trouble. The shift in the economic indicators may be a surprise, but it is yet another indication that the financial market is a constantly evolving entity that requires continued attention and adaptation. https://inflationprotection.org/mark-zandi-examines-the-factors-that-led-to-the-us-recession-indicators-breakdown/?feed_id=85506&_unique_id=64304f6fccaca #Inflation #Retirement #GoldIRA #Wealth #Investing #breakingnews #business #businessnews #careergrowth #CNBC #conflict #economic #economicreopening #economist #economy #employees #fed #federalreserve #financenews #financialnews #FOMC #gdp #greatresignation #Health #Hiring #indicator #inflation #interestrates #Janetyellen #job #jobs #labor #layoff #layoffs #MarkZandi #market #quietquitting #quitting #ratehike #recession #russia #Safety #shortage #stockmarket #turnover #U.S.Recession #ukraine #unemployment #usnews #workers #workforce #RecessionNews #breakingnews #business #businessnews #careergrowth #CNBC #conflict #economic #economicreopening #economist #economy #employees #fed #federalreserve #financenews #financialnews #FOMC #gdp #greatresignation #Health #Hiring #indicator #inflation #interestrates #Janetyellen #job #jobs #labor #layoff #layoffs #MarkZandi #market #quietquitting #quitting #ratehike #recession #russia #Safety #shortage #stockmarket #turnover #U.S.Recession #ukraine #unemployment #usnews #workers #workforce
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