These two leading indicators indicate that the US economic recession has already begun, according to Wall Street’s favorite forecaster

These two leading indicators indicate that the US economic recession has already begun, according to Wall Street’s favorite forecaster

Posted: November 22, 2023 at 3:07 PM ET

Wall Street’s perennial favorite is back with a warning to anyone who thinks the US economy is headed for a “soft landing” in 2024.

In his recent note to Société Générale clients, Albert Edwards, a global strategist at Société Générale who is widely followed for his pessimistic stances on the economy and markets, highlighted two key indicators of employment that preceded economic recessions in the not-so-distant past.

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Wall Street’s perennial favorite is back with a warning to anyone who thinks the US economy is headed for a “soft landing” in 2024.
In his recent note to Société Générale clients, Albert Edwards, a global strategist at Société Générale who is widely followed for his pessimistic stances on the economy and markets, highlighted two key indicators of employment that preceded economic recessions in the not-so-distant past.

He added that this would help convince skeptics that the recession that Wall Street has been waiting for since early 2022 may still be here.

First, employment rates in logistics jobs such as trucking have declined this year as demand for goods continues to increase due to the pandemic.
“The logistics industry is one of the best cyclical canaries you can spot in your coal mine. We have previously shown that declines in trucking jobs typically precede recessions,” Edwards said.
But if that’s not convincing enough, Edwards pointed to a subset of temporary employment assistance in the service industry, which also saw a decisive decline this year, mirroring the pattern that emerged before the recessions of 2001 and 2007.
“Prior to the recessions of 2001 and 2007, the CTA declined decisively about 12 months before the recession. Soft landing adherents should therefore be concerned that it has been sliding inexorably since October 2022. Adding 12 months or so to that takes us to… Um…today.”

The US labor market has shown signs of slowing since the post-pandemic period, with the unemployment rate rising to 3.9% in October, the highest level since early 2022.
be seen: Jobs report shows 150,000 new jobs in October. The US job market is cooling.
The data showed that the United States added 150,000 new jobs in October, a sign that the Federal Reserve’s aggressive interest rate increases since March 2022 are starting to have their intended effect.

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