Every quarter I write a report for UFM Market Trends of Universidad Francisco Marroquín (Guatemala), backed by the John Templeton Foundation, about the likelihood of a recession in the US. This week, we published our latest report on the US economy which included several surprising statistics (you know, the type of statistics you cannot read about anywhere else). Because, at first glance, everything seems to be going just fine: the economy is growing, the Fed is raising interest rates (allegedly because, according to the experts, everything is going remarkably well) and inflation remains subdued. But something is happening below the surface that cannot be directly observed from the headline numbers. Let me give you five charts which clearly show that beneath the surface things are not as pretty as they appear.

Problem 1: Businesses Are Reducing Investments in New Inventories

Source: UFM Market Trends, Bureau of Economic Analysis (BEA), St Louis Fed

Problem 2: The Car Industry Is Facing Trouble

Source: UFM Market Trends, Bureau of Economic Analysis (BEA)

Problem 3: Banks Are Scrambling for Liquidity and Are Reducing Maturity Mismatches

Source: UFM Market Trends

Problem 4: Corporate Credit Growth Is Weakening

Source: UFM Market Trends, Board of Governors of the Federal Reserve

Problem 5: The Yield Curve Is Flattening

Source: UFM Market Trends, St Louis Fed


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