Deflationary Debt Trap

[jazz]

Citi global economists and strategists have come out and actually predicted what investors have been concerned about for the past six months, a global recession.

“From goldilocks, via a brief reflation, we are heading to stagnation and then, probably, recession. European and Asian weakness is consensus. But US lead indicators suggest more downside delta to come in the US. Citi curve models put the probability of a US recession in a year at 37% but have never reached more than 50% even when recessions occur. So that’s 75% adjusted. As, and if, the curve inverts more, probabilities rise exponentially anyway. Hence we think the risks around Citi economic forecasts are solidly to the downside, and advise investors to prepare for recession.”

[errolanderson]

Citi global economists and strategists have come out and actually predicted what investors have been concerned about for the past six months, a global recession.

“From goldilocks, via a brief reflation, we are heading to stagnation and then, probably, recession. European and Asian weakness is consensus. But US lead indicators suggest more downside delta to come in the US. Citi curve models put the probability of a US recession in a year at 37% but have never reached more than 50% even when recessions occur. So that’s 75% adjusted. As, and if, the curve inverts more, probabilities rise exponentially anyway. Hence we think the risks around Citi economic forecasts are solidly to the downside, and advise investors to prepare for recession.”

Jazz . . . U.S. Federal Reserve is already under pressure by some of its governors to cut rates sooner-than-later. Low-degree panic is already setting in . . . .