Re:Vanguard Warns of Worsening Odds for the Economy and Markets
by panarky on Tuesday August 14, 2018 @01:07AM
(#17755702)
Any student of Taleb should know that "black swan" events are rare, unexpected, extreme outliers.
Economic recessions are none of these. They are common, expected, and well within the experience of most adults.
Booms and busts have been recurring semi-regularly since the beginning of market economies.
While it would be foolish to predict with any great certainty the date or duration of the next downturn, we can say with high confidence that a downturn will occur.
It doesn't seem unreasonable to observe that recessions are more likely when the yield curve is flat and valuations are historically high than when the yield curve is steep and valuations are more moderate.
Economic recessions are none of these. They are common, expected, and well within the experience of most adults.
Booms and busts have been recurring semi-regularly since the beginning of market economies.
While it would be foolish to predict with any great certainty the date or duration of the next downturn, we can say with high confidence that a downturn will occur.
It doesn't seem unreasonable to observe that recessions are more likely when the yield curve is flat and valuations are historically high than when the yield curve is steep and valuations are more moderate.