In this episode of Halloween specials, ‘The Indicator’ asks economists, what scares them about the current US economy? The first “monster” they identify is global uncertainty, largely caused by governments’ unpredictable decision-making processes. This will lead people into more reserved decisions that are ultimately detrimental economic growth.
The second “monster” is the record level of corporate debt due to low interest rates. Companies are failing to add enough value to the economy with the amount of cash they borrow. The final “monster” is the preliminary benchmark revision to the BLS unemployment numbers. This year’s adjustments to this data are greater than usual, suggesting that the growth of jobs in the US labour market might be slowing.
This week, we also plan to release Macro Hive’s scariest charts for Halloween, so stay tuned!
Why does this matter? In the face Halloween, a reality check on the global economy causes chills. Yes, when compared with the rest of the world the US’s overall performances are keeping it buoyant. However, we should look beyond the face value of US economy data and take account of subtle signs of pessimism in the dark. Only then will we recognise the tricks wrapped up in treats.
For access to our Slack Chat Room, where we discuss all things markets with our researchers and subscribers