The Recession Has Already Started: Insights from David Rosenberg on the U.S. Economy
As whispers of economic slowdown grow louder, renowned economist David Rosenberg has taken a bold stance, asserting that the U.S. economy is already in recession. A former chief economist at Merrill Lynch and the founder of Rosenberg Research, Rosenberg’s perspective carries significant weight in financial circles, particularly given his consistent ability to predict market trends. In his recent analyses, he emphasizes a variety of economic indicators that suggest the United States is facing a contraction—one that may have already commenced.
Understanding the Indicators
One of Rosenberg’s primary arguments highlights the disconnect between stock market performance and underlying economic realities. While major stock indices have at times seemed robust, he notes that this performance is not necessarily indicative of broad economic health. Key indicators such as rising unemployment rates, contracting consumer spending, and tightening credit markets suggest that the momentum driving the economy is faltering.
Rosenberg points to recent employment data as particularly troubling. While job growth has been strong in targeted sectors, the broader trend indicates a slowdown. The labor market, often seen as a leading indicator of economic health, is showing early signs of stress, with layoffs becoming more common. This pattern raises alarm bells as consumer spending—critical for economic growth—depends heavily on employment stability.
Inflation and Interest Rates
Another critical factor in Rosenberg’s analysis is inflation. With prices of essential goods and services continuing to rise, many consumers are finding their purchasing power eroded. Although the Federal Reserve has taken aggressive action to combat inflation through interest rate hikes, these measures come with their complications. Higher interest rates can lead to decreased consumer spending and can exacerbate existing economic vulnerabilities.
Rosenberg reminds us that the cumulative effect of these rate hikes can lead to unintended consequences, pushing the economy further into contraction. As businesses and households grapple with increased borrowing costs, the potential for an economic downturn becomes more pronounced.
Consumer Confidence and Spending
Consumer confidence is often touted as a vital ingredient for sustained economic growth. Rosenberg highlights that confidence has been wavering, driven by fears of inflation and the specter of potential job losses. As consumers tighten their belts in the face of uncertainty, discretionary spending has begun to wane, leading to reduced business revenues and creating a feedback loop that can spiral into a larger economic downturn.
The data suggests that the U.S. consumer, historically a stalwart of economic resilience, is beginning to buckle under the pressures of rising costs and stagnant wage growth. This is a dangerous combination that could precipitate a more profound economic contraction.
The Global Picture
Rosenberg’s assessment does not limit itself to domestic factors. He also considers the global economic landscape, which shows signs of vulnerability. Geopolitical tensions, trade disruptions, and global supply chain challenges further complicate the U.S. economic outlook. In an interconnected global economy, weaknesses abroad can quickly manifest at home, adding another layer of complexity to the recession narrative.
Navigating the Future
So, what does all of this mean for investors and policymakers? Rosenberg advocates for a cautious approach—one that acknowledges the economic signals without succumbing to panic. He urges a reevaluation of investment strategies, suggesting that sectors which historically weather downturns, such as utilities and consumer staples, may present safer bets during turbulent times.
Moreover, Rosenberg calls for proactive measures from policymakers. In times of rising unemployment and economic contraction, targeted fiscal stimulus aimed at facilitating consumer spending could mitigate the effects of a recession.
Conclusion
David Rosenberg’s assertion that a recession has already begun in the U.S. economy raises essential questions about the resilience of the current economic model. As indicators of economic slowdown mount, stakeholders must adapt to what may be a new normal marked by uncertainty and volatility. Whether through proactive policy responses or prudent investment strategies, navigating these challenging waters requires vigilance, adaptability, and, most importantly, awareness of the underlying economic trends that shape our world.
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Frick you democrat
Aged like milk
Cuts only postpone the crash. There is obviously no inherent economic growth in US outside of their artificial market stimulus. The economy is like a drug addict – as soon as you remove the drug – he collabs.
Recession of 1929 never ended economist throw chickn bones on chart I see a trend or I see a change coming.. when he says percent think angle of the chicken bone, rate is color of chicken bone spending equals eating fed reserve equals restaurant exeleration equals. Hungry crash equals poop . Masters in economics complete.
this its treade war of indonesian nikel for global.
Recession never ended we lost our houses to foreclosure in 2008 and it never got better. Our students loan interest rates continued to grow and many families lives were destroyed. In fact I was making more back in 2012 than I’m making now . Cost of living is already higher than fucking ever and these guys are complaining. I’d like to see them lose a few mansions and have live off $1300 a month with no car and see if they can survive a day in my shoes and I’m a girl.
They'll be more close downs of business on Thanksgiving…just read it!!..prepare people…this is it..were going down..just slowly..
As far as interest rates, you pay at least 4% on a car loan, 7% on student loans, 5% on mortgages, 8% on durable goods, and 17-27% on credit cards, while the banks pay you .5% on deposits. No way can you get ahead in this economy. It's a total screw job of the middle class.
Total nonsense about a less than 1% inflation rate. Families spend most of their income on housing, food, insurance, transportation, healthcare, and education, all of which have been increasing at a 5% or greater rate every year since 1970. In those 5 decades, all essentials have gone up by a factor of 12-16. In addition, real wages have fallen and household debt is at a record high.
Too many people commenting here that only consume the MSM information. Manufacturing jobs exceed available available workers. Wages are rising naturally. The market has regular small corrections. These people want a recession to get Trump out of office. It's offensive.
Recession never ended from 2008 look wages and inflation and prices
So the cure for "Too Much Debt" = "Easier Credit" ? ?
Please join EFIN DEX.
I listened to Mr. Rosenberg’s recent comment on Bloomberg (BNN) on August 23rd. Mr. Rosenberg spoke about warnings of note regarding a recession, and issues of tariff, policies of Governments, the affect on employment, etc. In a much smaller fashion, his comment mirrored the CDN economy. Tweets of the CDN Government taunting how great things are for Canadians. Huge disparity in prosperity created by CDN Government policy. Trade rifts between Provinces. Compatibility of thought absent and a Federal Government playing off the sides to garner votes. So very reminiscent of media comment directed at Trump. Huge mounting debt, in a time of prosperity. All the hallmarks of an economy problem made still larger by a Federal Government that has focussed almost exclusively on social issues and ignored business. In point of fact, a Federal Government that has endeavoured to further tax small business and stymy GDP through a variety of Regulation. We are as Mr. Rosenberg says IN a recession, and for Canadians it will last longer and be more painful.
The interest rate system of the fiat currency, is flawed to begin with. There's a reason Islam and other monotheistic Faith originally forbade taking or giving interest. Loans are based on equity and shared risk and reward. Everything from intermittent fasting, meditation, not drinking alcohol, Read up on Islamic Finance…And then they make people hate islam, to avoid the truth!
A slowdown is not a recession. We will have normal growth starting September 3, 2019.
The rich get richer. The poor get drunk. – the Replacements
Another fake story by a fake reporter on yet another fake station.
"The recession Lie". Brought to you by the media and democratic leadership.
They say RV sales are down? Have you seen the stupid ridiculous prices of RV's this year? No wonder people are buying used or building their own.
"The underlying inflation of the United States is a fraction of 1%"
In what universe does this man live in??? I guess when you're a rich asshole that doesn't do their own shopping!
Try telling Americans they need to slow down on their spending ,,,, and you'll find out real quick the talk about a recession is bullshit . You can't turn it off .
People need to get over this America the greatest..far from it. War is what we believe in and screw the citizens.
If we had Democratic socialism we would be protected from recessions.
More QE? Madness. The Fed barely got started unwinding the last QE. How many more trillions can we take? What cracks me up is how the financial media fluffers never describe QE as what it really is – 'printing money' – so that Joe Blo could actually understand what is going on. Joe Blo hears 'quantitative easing' and thinks it is something sophisticated. hahah.
Democrats have been depressed since the loser, Hillary lost!
Look someone who has either worked at Wall St. or has big ties is openly discussing how him & his people have engineered this problem…
If the economy is as good as Trump claimed it to be why does he want rates low. Trump is a fraud and conartist. He will go down in history as the greatest worst person in the world. We all will pay 30 for a loaf of bread. Your savings will be useless
So when is the housing market going to crash so I can buy a house? . . .
Continue to buy gold
When he says it, people take him seriously. When Warren says it, they call it alarmist.
If your cutting interest rates from anything less than 2% then your in recession and further cuts will do nothing. And where is the inflation, the share market. Low interest rates has inflated shares into a massive bubble.
This clusterfuck is on Trump. Two and a half years into his presidency…the economy is Trump's economy. Not Obama's.
Rail road car loadings and container traffic has been down for the first 26 weeks of 2019.
On that point it would depend on who you ask, what they see in areas they travel to outside of their area, and how they are doing personally economically.
I agree with you. I'm doing ok. I live my life simply and am suffering from no money crisis. (That's now, who know what tomorrow will bring), but all throughout the news media declaring that the this country has moved out of the recession since 2012, I refused to believe it. Believe whatever you want that looks good on paper. Let these politically bought off economists hypnotised you with "It's a strong economy! It's a strong economy!". But not only do I see the lingering effects of that previous recession as I travel throughout this country, but I see same old busines practices going on that triggered the last one.
Stock market up,. 10 yr bond 2 , consumer sediment 98.5 . Really maybe you should get a job in Disney world
The rich are getting richer as rates are too low.This guy is for the 1 %.
I have been in the trucking business for a while .This year has been the worst for us ask any trucker the freight rates have dropped by a huge margin compare to last year.Already few companies have laid off drivers some shut their doors for good.Not looking hot.
Two things really bother me about this guy. 1. He seems to WANT a recession. Notice how when he references the industrial topic and later concludes that we may already be in one….he smiles like it's good news. 2. It always comes back to Trump with this guy.
I think #2 is because of #1. He wants a recession for the opportunity to smear Trump and that's just sad. I don't agree with a lot of things this President does myself but to wish financial hardship on Americans just to have reason to blame Trump is pure evil.
DOZED OFF
It started in July 2018. Im a trucker rates are low volumn is extremely low. Reefer loads available down 55% Flatbed down 74.5% Van loads down 50.3 . These are compared to last yr. 29.9% of trucks sitting empty. These numbers come from nations number 1 loadboard for truckers. Ask yourself if this is a booming economy how and why are Trucking companies filing for backruptcy. Truck sales are down lots are filling up with repo's . Im a Republican i have done nothing but lose money in 2018 2019. Im lucky to survive 2019
is this the guy that was at the Carlyle Group and George W Bush showed up (George Sr was a big deal at Carlyle) and wondered what is this clown doing here?
If the ICE raids targeted gang members, then no issue, however, if they are primarily targeting families, then that will probably generate quite a number of unpredictive outcomes than we have the resources to control and contain.
can't wait till it happens again. houses will be super cheap