"John Hussman is still building the case for recession. His latest letter is another convincing case for economic decline. This time, however, he’s adding the caveat of a “whipsaw trap” in the equity market. The latter I can get on board with as the market appears somewhat complacent in the near-term (whipsaw trap might be a bit dramatic though!), but I still don’t see the case for recession. His latest, as always, is a good read:
“As of last week, the combination of evidence we observe continues to be associated with strong recession risk and the likelihood of a “whipsaw trap” in the stock market. We’ll respond to new data as it changes, but I expect that the primary window of interest here is about 6-8 weeks. In the event that economic data can produce fairly upbeat readings over that horizon, and the S&P 500 can remain at or about present levels, our estimate of oncoming recession risk would back off fairly quickly. Presently, that outcome would be outside of the norm based on the leading economic measures we track, as well as the overvalued, overbought, overbullish condition of the stock market..."at http://pragcap.com/hussman-prepare-for-recession-and-a-whipsaw-trap-in-the-market
