- There’s an 85% chance the US economy will enter a recession in 2024, the economist David Rosenberg says.
- He highlighted a relatively new economic model that has proven to be more timely than the yield-curve indicator.
- “Our conviction that the recession has been delayed but not derailed is still running at a high level,” Rosenberg said.
A recession is likely to hit the US economy in 2024, a new economic model highlighted by the economist David Rosenberg suggests.
The economic indicator, which Rosenberg calls the “full model,” suggests there’s an 85% chance of a recession striking within the next 12 months.
That’s the model’s highest reading since the Great Financial Crisis in 2008.
The model is based on a working National Bureau of Economic Research paper and consists of financial conditions indexes, the debt-service ratio, foreign term spreads, and the level of the yield curve.
Rosenberg said this economic model had “superiority” over other models due to its history of providing a timely warning of recessions without firing any false signals since 1999.
He noted that in early 2023 this model suggested only a 12% chance of a recession — while the yield-curve indicator said the odds of a recession were 50% at the time.
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