With only one trading day left before investors turn the page on 2022 which has seen the U.S. stock market’s biggest annual decline in over a decade, pessimism over a likely slowdown in economic growth prevails as investors look to 2023.
“To be sure a severe recession would be bearish for stocks yet given the resilience of the U.S. economy and the tight labor market, we are expecting a slowdown or shallow and brief recession,” said Nancy Tengler, CEO and chief investment officer of Laffer Tengler Investments. “That could allow stocks to rally in the second half of 2023 as they look around the recession corner.”
The Congressional Budget Office’s estimate shows the number of employed Americans will rise from 158 million in 2022 to 174 million in 2052. Pollak said the economy should be “comfortable with even lower numbers of job gains in subsequent years.” Those projections imply net job gains of only 45,000 jobs a month on average over the next 30 years, absent an increase in U.S. population growth.
See: Did 2022 break Wall Street’s ‘fear gauge’? Why the VIX no longer reflects the sorry state of the stock market “However, the flip side is that a mild recession would likely not create much additional pent-up demand and, assuming we see only a modest increase in unemployment, the employment and income boost from a falling unemployment rate would also be less than normal,” he said. “Perhaps most significantly, in contrast to each of the last four recessions, there is unlikely to be any significant fiscal stimulus to reenergize the economy.
Probably two (2) more meetings of small or moderate rate hikes, then a long pause to see whats what.
If your neighbors lose their job, it's a recession. If you lose your job, it's a depression.
rECESSION and hiring?
The major problems of 2022 the White House created for itself: The UKraine war, the China trade and sanctions, and inflations have not gone away. In fact it will exasperate more intensively in 2023. The US stock market will fall further. I see another 20% slump.