Home|Who We Are|Our Services|Resources|News Center|Contact Us|Client Access
More Articles  Printer Friendly Version


The Conference Board Predicts Short, Mild Recession For First Half Of 2024

A mild recession will begin in the first quarter of 2024 and end in the second quarter, economists at The Conference Board (TCB), a think-tank for the world’s largest companies predicted Wednesday.

The big business group’s economics team expects an interest rate hike before the end of 2023, followed by two negative quarters of -1% and -0.7% before the Federal Reserve loosens credit and lowers the cost of borrowing.

“We see a lot of headwinds on the horizon,” Erik Lundh, principal economist at TCB said. “Spending activity towards the end of 2023 and into early 2024 is going to be pulled back. On an inflation-adjusted basis spending is not being underpinned by personal income growth and real personal income growth.”

5183 4

The massive savings built during the pandemic is nearly depleted, Mr. Lundh said. Interest rates on credit card debt and car loans are higher than in years, he added, and mandatory payments on student loans are about to begin again. As a result, consumer spending will soften, causing a recession to begin early in 2024.

TCB’s outlook is gloomy, but it is predicting a strong comeback in the second half of 2024, with +1.9% growth in the third quarter and +2.5% growth in the final quarter of 2024.

The economy outperformed TCB’s expectations for the last two quarters. Economist Fritz Meyer, who we regularly quote in this space, says the recent strength of new-job creation data released last week makes a recession in the first quarter of 2024 unlikely.

With a Mideast war, oil prices and higher inflation add a new risk to the outlook. However, trying to time the stock market based on the economic outlook is unwise.

Rather, investors should consider a recession early next year as one scenario to be prepared for but remain focused on the longer-term outlook. Even if TCB’s economists are right, a recession is expected to be short-lived and mild. Moreover, the stock market often discounts the outlook over the next several months and may already reflect a mild recession to come.

Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances.
The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions.
This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice.

Email this article to a friend

Fed Governor Kugler Details Inflation And Economic Outlook
Why Rates May Not Be Cut Until June
Practical Suggestions For Achieving Your 2024 Resolutions
A Sign Of Progress In Solving U.S. Economic Problems
Fed Keeps Rates Unchanged; Expects Easing In 2024
Have You Logged Into Your Social Security Account?
The Great Fake Out Of 2023 Is Poised To Extend Into 2024
Financial Crime Snitches Are In Stitches, Exacting Revenge Against Dishonest Former Employers
Amid A Confluence Of Crises, Keep Financial History Top Of Mind
The Federal Reserve Decided Not To Raise Rates
Finding The Truth About Long-Term Investing Is Too Hard
The Coming Reversal of Tax Cuts and Jobs Act Will Be a Financial Setback for America’s High-Income-Earners and High Net-Worth Individuals
What The Federal Reserve Decided Today
What To Know About Converting To Roth IRAs
2023 Year-End Tax Planning, Part 1

This article was written by a professional financial journalist for Responsive Financial Group, Inc and is not intended as legal or investment advice.

©2024 Advisor Products Inc. All Rights Reserved.
© 2024 Responsive Financial Group, Inc | 204 W Wing St, Arlington Heights, IL 60005 | All rights reserved
P: 847-670-8000 | F: 847-590-9806 ben@rfgweb.com |
Disclosure | Contact Us
Responsive Financial Group, Inc. is a fee-only registered investment advisory firm in the State of Illinois. Information on this site is compiled from multiple locations and is believed to be accurate. Incorrect information may come from these outside sources. Should you notice anything please notify us immediately. Thank you!