{"id":18659,"date":"2019-08-13T07:46:02","date_gmt":"2019-08-13T07:46:02","guid":{"rendered":"https:\/\/thepatientinvestor.com\/?p=18659"},"modified":"2019-08-13T07:46:57","modified_gmt":"2019-08-13T07:46:57","slug":"recession-ahead","status":"publish","type":"post","link":"https:\/\/thepatientinvestor.com\/index.php\/2019\/08\/13\/recession-ahead\/","title":{"rendered":"Recession ahead"},"content":{"rendered":"

There are clear signs of trouble on the horizon.<\/p>\n

10-Year Treasury yields plunged to near record lows this month as investors fled stocks for the safety of bonds.<\/p>\n

\"10-Year<\/p>\n

The Federal deficit is widening — unusual for this late in the cycle as Liz Ann Sonders<\/a> points out. We are being prepared for the impact of a trade war: pressure the Fed to cut rates and raise the deficit to goose stocks.<\/p>\n

\"Federal<\/p>\n

Gold surges as Chinese flee the falling Yuan.<\/p>\n

\"Spot<\/p>\n

Commodity prices fall in anticipation of a global recession.<\/p>\n

\"DJ-UBS<\/p>\n

Are we there yet? Not quite. The Philadelphia Fed Leading Index is still above 1% (June 2019). A fall below 1% normally precedes a US recession.<\/p>\n

\"Leading<\/p>\n

Volatility (Twiggs 21-day) for the S&P 500 is rising, as it usually does ahead of a market down-turn, but has not yet formed a trough above 1% — normally a red flag ahead of a market top.<\/p>\n

\"S&P<\/p>\n

And annual payroll growth is still at 1.5%. This is the canary in the coal mine. A fall below 1% (from its 2015 peak) would warn that the US is close to recession.<\/p>\n

\"Payroll<\/p>\n

What to watch out for:<\/p>\n