Amid the continuously darkening economic outlook, the probability of a recession in the United States for the following year is extremely high, reminiscent of the levels in the 1980s when this indicator reached the heights of around 90%-95% for several years.
Indeed, the recession probability based on the 10-year/3-month term spread is exceptionally high – the highest since the early 1980s, according to the analysis by the pseudonymous finance and economy expert Game of Trades shared on August 9.
US recession probability. Source: Game of Trades
On top of that, as the analyst explained in an earlier post on X (formerly Twitter), “banks have continued to tighten lending standards,” indicative of a recession due to the historical trends that demonstrate that the big rise in banks’ tightening has “systematically led to a recession since 1990.”
Banks‘ lending standards. Source: Game of Trades
Warnings mount
In late May, Bloomberg’s senior commodities expert Mike McGlone warn
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