Rosenberg Sees ‘99% Chance’ of US Recession by 2012

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David Rosenberg’ view of the politics driving fiscal and monetary policy in the US and what QE3 could look like are very similar to my own. He sees this producing recession by 2012. I don’t like predicating my view solely on political choices so I’m not there yet. But, clearly I have been making a similar macro case, leading to the same outcome since 2009. I don’t have any other comments on this yet, but it is definitely newsworthy.

Bloomberg video below

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4 Comments
  1. Gordon Graham says

    If this is what we have to expect how best does one survive?

  2. fresnodan says

    Did we ever truly get to growth to begin with?

    The GDP figure depends on the GDP deflator, and the GDP deflator is a reflection of what the inflation rate is.  Use CPI and we have no growth at all.  Use BEA and we could “slip back into recession”
    And finally, so what if there is growth – if the growth all ends up at Goldman Sachs?
    http://dallasfed.org/data/basics/nominal.html
    http://www.clevelandfed.org/research/Data/US-Inflation/cpi.cfm
    http://dshort.com/articles/Real-GDP-alternative-deflators.html

  3. Anonymous says

    Did we ever truly get to growth to begin with?

    The GDP figure depends on the GDP deflator, and the GDP deflator is a reflection of what the inflation rate is.  Use CPI and we have no growth at all.  Use BEA and we could “slip back into recession”
    And finally, so what if there is growth – if the growth all ends up at Goldman Sachs?
    http://dallasfed.org/data/basics/nominal.html
    http://www.clevelandfed.org/research/Data/US-Inflation/cpi.cfm
    http://dshort.com/articles/Real-GDP-alternative-deflators.html

  4. Edward Harrison says

    Gordon Graham my hope is that policymakers will see the error of allowing a debt deflation to take hold and move accordingly. We saw the same sort of recurrent political situation regarding debt, fiscal deficits, and stimulus in Japan. This was devastating for the stock market but the economy survived. I look at it from an investor’s standpoint and that means rotating portfolio sectors every o often rather than using a bu and hold strategy. if one rotated int financials in 2009 and then into cyclicals, the time has long come to rotate out and into technology or consumer staples depending upon risk tolerance. But people need to voice their discontent or the policy mistakes will mount

  5. Gordon Graham says

    Have you communicated that to your reps in Congress? This is not like a game
    of chicken but more like Russian Roulette.

Comments are closed.

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