Expert insight
Bloomberg podcast: Considering the odds of a U.S. recession
July 31, 2023
In an episode of Bloomberg’s What Goes Up podcast with hosts Mike Regan and Katie Greifeld, Vanguard’s global chief economist and head of its Investment Strategy Group, Joseph H. Davis, discusses the continuing possibility of a recession; Vanguard’s take on where inflation and the labor market might be headed; and the outlook for bonds.
Key takeaways from the interview:
- Davis discusses why the odds of a recession remain high but says that he expects it to be fairly mild like the one we went through in 2001.
- That outlook is based in part on the expectation for some weakening in the labor market—pushing up the unemployment rate to around 4.5% at some point—in order to get inflation finally down around 2%.
- Bonds are back; their higher yields are providing income again, in a positive development for investors.
- The return of sound money has been one of the financial markets’ most positive developments in the last 20 years, heralding higher returns for savers.
Listen to Davis's interview in its entirety at Bloomberg.
Related links:
- Active Fixed Income Perspectives Q3 2023: Cruising altitude (article, issued July 2023)
- The top three misconceptions about the 60/40 portfolio (article, issued July 2023)
- Our investment and economic outlook, July 2023 (article, issued July 2023)
- What the rapid rise in rates could mean for investors (article, issued June 2023)
- A midyear update on our economic and market outlook (article, issued June 2023)
Notes:
All investing is subject to risk, including possible loss of the money you invest. Diversification does not ensure a profit or protect against a loss. Past performance is no guarantee of future results.
Investments in bonds are subject to interest rate, credit, and inflation risk.
