Half of Americans Expect a Major Recession Soon, New Survey Shows

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Topline: Amid a backdrop of slowing economic growth, ongoing geopolitical concerns and almost 15 months of trade tensions, more Americans are worrying about a looming downturn this year, according to the latest Allianz Quarterly Market Perceptions Study.

• 50% of respondents see a major recession right around the corner, an increase from 46% earlier this year.
• Fewer people are saying now is a good time to invest in the market: only 35% of respondents, compared with over 40% at the beginning of the year.
• Millennials remain the most concerned out of any generation: 56% said they are worried about a major market downturn on the horizon, compared to 51% of Gen Xers and 46% of Baby Boomers.
• On the flip side, Millennials are the most comfortable with recent market volatility: 47% would invest now, compared with just 17% of boomers.
• “While Millennials might be most worried about a recession, they seem to be feeling more at peace about their situation–likely because they have more time to recover from any major losses,” describes Kelly LaVigne, vice president of Advanced Markets, Allianz Life.
• Recession fears have also resulted in fewer people saying it’s important to have retirement savings in financial products shielded from market losses: only 66%, compared to 72% last quarter.

No More Half-Measures on Corporate Taxes

Crucial quote: “Market volatility didn’t take a vacation this summer,” LaVigne said in a statement. “With major fluctuations over the past quarter, it’s not surprising that Americans are skittish about investing and worried that a market crash and recession might be around the corner.”

Key background: Since the start of October, the stock market has been noticeably more volatile than the previous quarter. Ongoing uncertainty over trade negotiations with China—scheduled to resume on Thursday—continue to take center stage and stoke recession fears, as prospects for a comprehensive trade deal look gloomy. What’s more, the yield for the three-month Treasury has been higher than the ten-year Treasury since May: Known as an inverted yield curve, it’s a major indicator that has predicted the past seven recessions.

Forbes.com