Recession risk is rising: What Americans need to know

Here's how an impending recession could impact everyday Americans.

Transcript

00:00We think they're somewhere around 50 percent.

00:02That might not be very helpful for investors,

00:05because it's basically a flip of the coin,

00:07but it does tell you something.

00:09It does tell you that if you're highly risk-averse

00:11and if you cannot tolerate volatility in your portfolio,

00:15now is not the time to be making those bets.

00:17So the average American will be impacted by U.S. recession

00:21the way most recessions tend to pan out.

00:23You'll see job losses that will lead to reduced consumption,

00:28that will lead to increased job losses, right?

00:31So this is the positive feedback loop

00:33that unfortunately takes place in recessions.

00:35Now, I will say this.

00:37There's always a lot of fear with recessions.

00:39Obviously, no one wants to lose their job

00:40and no one wants to see a contraction in economic activity.

00:42But recessions tend to be actually healthy and needed for an economy.

00:49The sort of issue we've had is that the last two recessions we've had

00:52in the United States have been shocks,

00:54exogenous shocks to the system.

00:56I'm talking about COVID, the global financial crisis.

00:59Most recessions do not look as bad as those two did.

01:02Although this one, I would characterize it as a fiscal shock.

01:06I would also characterize it as a fiscal shock that could potentially be reined in.

01:10Because it is policy-induced, policy could also make it better.

01:15So my point is that if we do go into recession, which like I said,

01:20I think at this point we pegged around 50% odds,

01:23I think it's much more likely to be a milder recession

01:25than we've seen over the versus the previous two.

01:28So we'll see you there.

01:29So we'll be at the back of the next two.

01:30So we're going to see you there.

01:31So we'll be at the back of the next two.

01:32So we'll be at the next two.

01:33So I'm going to see you there.

01:34It's the next two of the previous two.