Generally speaking as I’ve noted in the past, when the next downturn happens there will be a slew of people who said they called it. In reality few accurately predict, let alone prepare for, the specific downturn that happens next.
As of now, fear seems high. Lots of uncertainty about war. People doubling down on commodities after they have had a huge run. Inflation shocking multiple generations from old to young. Deep social and political division. Etc. Few people are bullish:
But certain barometers of economic health are telling a different story. One recession indicator is going the other direction, the 10Year – 3Month US government yield spread (red line):
High yield spreads are low and steady:
And the consumer is in good shape:
The divergence from what people’s expectations are for the future (mayhem!) versus what certain core indicators have been registering in, may mean one thing, volatility. And generally speaking volatility along with apprehension is not a poor time for investors or companies to be taking advantage of select investment opportunities.