E21 - When the Market Is Talking Recession, History Says They’re Wrong

Jordi Visser

March 25, 2022

The situation in Ukraine is abhorrent. As commodities continue their volatile ride higher, well-known and revered market participants are warning of an impending recession, or worse, and then there is the Fed. The Fed has gotten hyper-hawkish in a hurry with talk of multiple 50-basis point hikes on the table. If you combine these points, it is easy to understand why so many market participants have become so bearish. Weiss's Jordi Visser sees things differently. He thinks we will likely hit all-time highs for the S&P this year.

The pessimism is amped up. Everything you read would suggest we are in a bear market and on the verge of World War III. However, with respect to the former, Jordi contends we are in a bull market based on the data he is looking at. As it relates to the latter, Jordi suggests that when WWIII is a highly searched trend, it’s not the time to be bearish.

With many worried that Putin is committed to pressing forward, it begs the question as to whether the headlines and images are weighing on people's sentiment. Jordi asserts that eventually, investors will become desensitized to the images and headlines, and instead revert to the data which asserts a recession is not imminent this year. While acknowledging that he’s not a war expert, Jordi finds it hard to believe the World War III narrative when Russia is expending so much energy in Ukraine alone.

In response to those worried about an impending recession, Jordi refers to the facts–he weighs the current environment of higher nominal GDP, higher inflation, and the Federal Reserve’s reaction. His main point is that with the Fed so far behind the curve from an inflation perspective, they simply cannot slow the economy down by moving at their current or forecasted tightening pace.

To conclude the conversation, G3 and Jordi discuss how investors should manage their emotions in these volatile times.

Please subscribe to In Search of Green Marbles wherever you get your podcasts.

Important disclosures: Disclosures: This content (the "Insights Page") is provided by Weiss Multi-Strategy Advisers LLC ("Weiss"). The views expressed on the Insights Page are for informational purposes only and are subject to change without notice. Information on the Insights Page has been developed internally and is based on market conditions as of the date of the original post on the Insights Page from sources believed to be reliable. Nothing on the Insights Page should be construed as investment, legal, tax, or other advice and should not be viewed as a recommendation to buy or sell any security or adopt any investment strategy. Past performance is no guarantee of future results. Please consult your own advisers regarding business, legal, tax, or other matters concerning investments. Weiss has no control over information at any external site hyperlinked on the Insights Page. Weiss makes no representation concerning and is not responsible for the quality, content, nature, or reliability of any hyperlinked site and has included hyperlinks only as a convenience. The inclusion of any external hyperlink does not imply any endorsement or ongoing monitoring by Weiss of any hyperlinked site. Investing in securities is speculative and involves substantial risk of loss.

Subscribe here to stay current with the latest research and insights from Weiss.

E21 - When the Market Is Talking Recession, History Says They’re Wrong

Jordi Visser

Subscribe here to stay current with the latest research and insights from Weiss.

Relevant Insights

The Fed is in a Sticky Situation [PODCAST]

January 2024 Monthly Review

The AI and Cooking Connection: The Final Green Marbles Entrée [PODCAST]

Copied Link

Subscribe here to stay current with the latest research and insights from Weiss.