Home News 3 Reasons Mark Sanford’s Grim Economic Prediction is Wrong

3 Reasons Mark Sanford’s Grim Economic Prediction is Wrong

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Mark Sanford, former Republican South Carolina Governor, thinks we’re in a heap of hassle. He instructed “Fox News Sunday” that he predicts “the most significant financial storm… because the Great Depression.” Coincidentally, Sanford additionally introduced he’s difficult President Donald Trump in 2020. It wouldn’t be the primary time a politician has mentioned one thing alarming to seize the highlight.

Unfortunately, there’s an energetic viewers for such dismal predictions. Google searches for “recession” have lately skyrocketed. The menace of a commerce warfare made the Dow Jones Industrial Average (DJIA) futures plunge. Stock market legends have even joined the somber refrain.

But issues aren’t that dangerous, actually. Here’s why.

The Economy Actually Has Been Picking Up

Despite a turbulent August, the S&P 500 simply accomplished two weeks of gains in a row. It rose 2.8% two weeks in the past and 1.8% final week. The Nasdaq Composite climbed 1.8% final week. Even the dreaded DJIA rose 1.5%. Not dangerous for an financial armageddon.

S&P has been rising since August turbulence. | Screenshot from yahoo.com.

Tom Lee, CEO of Fundstradt, instructed CNBC that the S&P has held up “really well,” displaying us that the enterprise cycle “isn’t as weak as the market believes.”

Ed Butowsky, managing associate of Chapwood Capital, lately instructed CCN:

“Let’s also remember that a recession is defined as two consecutive quarters of negative GDP growth. So far we haven’t even had one. The last quarter came in at a weak 1.9%, but the average during the Trump administration has been 2.7%. So let’s not get ahead of ourselves talking about recessions.”

August Jobs Report had Positive Signs

Although the August jobs report wasn’t a house run, it was removed from a strikeout. While job development got here in about 13% below Wall Street predictions, there have been different promising indicators. The unemployment charge stayed the identical whereas wage development grew 0.4%, elevating it to 3.2% for the yr. Labor drive participation rose to 63.2%, its highest stage in six years.

Scott Clemons, chief funding strategist at Brown Brothers Harriman, instructed CNBC:

“If we weren’t already talking about recession risk and already looking for signs of a slowdown, we wouldn’t start today because of this jobs report.”

Adding,

“I think it’s a pretty good jobs report.”

Fed Is Not Panicking

Federal Reserve Chair Jerome Powell mentioned on Friday that his main expectation is “not that there will be a recession.” He added the customers are “in good shape.” Despite pleas and attacks from President Trump to decrease rates of interest additional, Powell has not acted swiftly. Powell’s calm is one other signal that the market is probably not in as a lot hassle as individuals are able to imagine.

While worry and uncertainty nonetheless loom, it’s not the time to panic. As the 2020 race heats up, extra candidates like Mark Sanford will attempt to scare you into voting for them. It’s extra necessary than ever to get the entire image earlier than believing ominous headlines.


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