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Historically, Bloomberg Economics has used a recession probability model that incorporates factors like housing permits, consumer sentiment, corporate profit outlooks, and Treasury yield gaps. It doesn’t always work. For example, in October 2022, they projected a 100% chance of a U.S. recession by October 2023, driven by aggressive Federal Reserve rate hikes, tightening financial conditions, and persistent inflation.
Here we go again. Consumer confidence fell this month by the most since August 2021 on concerns about the outlook for the broader economy, Bloomberg notes. Many consumers think we’ll see a recession later this year. That pessimism has more than half of consumers delaying major life plans due to uncertainty over the economy and the consequences of Trump’s tariff threats. Of those, about a third said they were putting off buying a home while one in six have postponed education plans—and one in eight have pushed back retirement.
On today’s episode of “The TMI Show,” Ted Rall and Manila Chan discuss the prospects for the economy with finance expert Aquiles Larrea.
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“Many consumers think we’ll see a recession later this year. That pessimism has more than half of consumers delaying major life plans due to uncertainty over the economy and the consequences of Trump’s tariff threats.”
I always question this sort of pronouncement. “Would you say your failure in life is due to ‘not getting a break’ or ‘my quart of gin a day’ habit”? We all know how most people will answer: it’s “them” that did it to me. Not my personal failings, systemic ones. In a similar fashion, I wonder how many people are “delaying” not due to uncertainty or Trump but because they simply can’t afford it. Technically, yes, it’s a form of “uncertainty” but not the kind that the reports are indicating because in the one case, you could make those purchases. In the other, this is just the ego-palatable way of being broke.