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All the pundits who say the US will go into recession by 2020 – just like Trump seeks re-election

His bragging has so far seemed justified, with unemployment nearing its all-time low and the stock market soaring, thanks to the impetus of tax cuts and deregulation. But over the past three months, things have looked a lot less certain. Stocks fell nearly 10%, putting 2018 on track to be the market worst year since the 2008 recession. Meanwhile, investors have grown increasingly concerned about the tightening labor market and lingering trade tensions. And now, many economists are predicting the economy will head south over the next 12-24 months.

This timing could be the worst possible for President Trump. In fact, of the 10 outgoing presidents who have sought re-election since the end of World War II, the only three to lose – Gerald Ford, Jimmy Carter and George HW Bush – have all been defeated amid periods of economic growth. sluggish. , according to the Brookings Institution.

Here are all the people sounding the alarm bells about 2020:

Billionaire Ray Dalio

Dalio, one of the wealthiest hedge fund managers in the United States, said earlier this year that “the likelihood of a recession before the next presidential election would be relatively high, [at] 70%. “He then warned that his so-called depression gauge, which accurately predicted the 2008 financial crisis, was showing warning signs. Dalio fears the dollar may dip as the government prints money. money to offset a growing budget deficit The problem, he said, would inevitably be exacerbated by rising interest rates and rising pension and health care costs.

Former Fed Chairman Ben Bernanke

Earlier this summer, Bernanke, who led the Fed from 2006 to 2014, compared the U.S. economy to an episode of Looney Tunes, explaining that he could soon face what has been called a “Wile E. Coyote moment” as the benefits of the Trump administration’s various forms of fiscal stimulus – like the 2017 tax cuts – begin to fade. “In 2020, Wile E. Coyote is going to fall off the cliff,” Bernanke said.

Moody’s Analytics

The year “2020 is a real inflection point,” warned Mark Zandi, chief economist at Moody’s Analytics, at the start of the year. Higher interest rates and a growing deficit will both put the economy at risk just in time for Trump’s re-election campaign, he argued. “It’s going to take very good policies and a little luck to avoid a recession in 2020.”

JP Morgan

JPMorgan’s real-time recession forecasting model is significantly higher than it was earlier this year. He currently places the risk of a market downturn at 70% by 2020. Strategists have tied the partially inverted yield curve – which they expect to completely invert by mid-2019 – as another reason for s ‘worry.

Economist Nouriel Roubini

Roubini, who predicted the 2008 crash, says short-term growth due to fiscal stimulus is “unsustainable” and that a correction will put a decisive end to the current bull market. Citing several factors such as trade disputes, high debt levels, rising inflation and an overvalued stock market, Roubini argued that conditions would be “ripe for a financial crisis” and a global recession by now. 2020.

Black rock

Chief investment strategist Richard Turnill warned of the growing likelihood of a slowdown earlier this month in an interview with Fortune. He attributed much of that risk to the ongoing trade dispute with China, rising interest rates and massive debt levels. Slowing corporate profit growth and a weakening global economy could further fuel the flames. In addition, BlackRock’s 2019 Global investment outlook puts the probability of a recession by the start of 2021 at over 50%.

American CFOs

Indeed, more than 80% of U.S. CFOs believe a recession will hit the economy by the end of 2020, according to a Duke University / CFO Global Business Outlook survey released on Wednesday.

Trump’s own advisers

Even the president’s advisers have grown increasingly alarmed, according to Politico’s interviews with eight current and former administration officials. Of course, none of them have been made public, but as a Republican close to the White House admitted, “It could be a very dangerous situation if market volatility hurts workers in the main states of the United States. battlefield “. The current level of concern is at DEFCON 3, the Republican said, but it will certainly increase next year if no solution to the trade dispute with China emerges soon.

(An earlier version of this story misspelled BlackRock executive Richard Turnill’s name.)

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