Economic downturn and stock market collapse possible
In the bustling world of finance, the recent dip in stock market prices has got everyone on edge—especially with whispers of an impending crash and recession in the air. But what's got everyone in a tizzy is J.P. Morgan's crestfallen proclamation on the matter.
With a furrowed brow, they're talking about a 40% chance of an American economic downturn. Eek! That's a whopping ten percentage points jump from their earlier prediction, back when the GDP growth seemed less threatened.
"If we keep going down this rabbit hole of trade tiffs and unwanted policy surprises," says their chief economic guru, Bruce Kasman, "then I'd say we're in big, bold, capital-R TROUBLE."
Needless to say, he names the controversial trade tariffs under the old office, AKA the Trump Administration, as a significant pain in the financial neck. The uncertainty surrounding future government moves doesn't help either.
Recession and a Market Crash, You Say?
So, what does this ominous declaration mean for the stock market's future? Well, with J.P. Morgan not exactly Mr. Sunshine about the economic development prospects Stateside, other analysts like Goldman Sachs aren't looking so chipper either. And let's just say, their recent outlook isn't exactly rosy.
But before you start gripping those dividend checks tighter and collecting all your tinfoil hats, remember—you're an intrepid investor, not a panic-stricken squirrel! So, check out our guide on surviving an economic crisis without going batty: When Stocks, Crypto, and More Go South: Emergency Response for Investors
Insider Scoop: Stocks They're Buying, Selling
Want the inside scoop on stocks that Wall Street insiders are currently championing? Get all the dirty details right here: Stealthy Stock Transactions: These Are the Titans That Insiders are Buying—and Selling—Now
[1] [Reuters] - Goldman Sachs raises S&P 500 forecast, citing lower tariff and recession risks: https://www.reuters.com/article/us-usa-stocks-outlook-idUSKCN1RV1SP
[2] [CNBC] - JPMorgan cuts U.S. recession probability to below 50%: https://www.cnbc.com/2021/02/10/jpmorgan-cuts-us-recession-probability-to-below-50-.html
[3] [Bloomberg] - JP Morgan ups U.S. growth forecast for 2025 to 0.6%: https://www.bloombergquint.com/global-economics/jpmorgan-ups-2025-us-growth-forecast-to-06-but-views-recession-risks-remain-elevated
In the face of J.P. Morgan's ominous prediction, other analysts like Goldman Sachs are also expressing concerns, suggesting a less rosy outlook for the stock market. Despite the recent 40% chance of an American economic downturn mentioned by J.P. Morgan, intrepid investors should approach the current market situation cautiously, rather than panicking. [Reuters, CNBC, Bloomberg]
