Today's data says "hell no" — Tomorrow's says "maybe"
It's like the weather... When the economy is expanding, it's sunny out for businesses as you spend more money and companies grow profits more easily. The US economy's been sunny since June 2009 — a 10+ year streak of econ growth with no recession (a recession = 2 consecutive quarters of economic shrinkage). After a bunch of data came out last week, we'll just ask it: Is the economy heading toward a recession?
Our Magic 8 ball is "leading indicators"... A couple of them arrived last week in the form of 2 econ reports — they revealed that your boss probably isn't feeling great about where the US economy is heading:
- Factory Folks: A survey of over 300 managers at manufacturing companies showed the worst sentiment since 2009. For 2 straight months, more factory managers are planning to shrink their business than grow them.
- Everyone Else: The same survey, but for non-manufacturers (picture restaurants, law firms, and the rest of the 80% of our economy not happening in factories) hit its worst point since 2016, but is still in "growth" mode.
If you look at the economy now, things look incredible... "Current indicators" like the monthly employment report must have joined Crossfit: The economy added 136K new jobs in September and the unemployment rate hit a 50-year low at 3.5%. If you want to celebrate a booming economy and near-record-high stocks, do it now — business managers worry the Trade War could crash the growth party.