Posted 3/15/2024, 6:00:00 AM
Rising Job Losses Signal Impending Recession Risks But Markets Seem Complacent
- Labor market data showing rising unemployment and job losses, signaling impending recession
- Fed rate hikes not yet triggering formal recession signals like Sahm Rule, but getting close
- Markets seem complacent, expecting Fed to rescue economy if it rolls over
- Risk has migrated to lightly-regulated shadow banking sector, concentrated in derivatives
- If Sahm Rule recession signal triggers, expect violent moves across risk assets and economic contagion
