Goldman Sachs Predicts US Recession

With the market falling by 10% this year, Goldman Sachs has just raised the odds of a US recession to 35%!

This is causing some to worry that we are indeed going into a recession.

In Aug 2024, Goldman Sachs actually cut its probability forecast for a U.S. recession to 20% from 25%, shortly after raising it from 15%

In Oct 2024, Goldman Sachs actually reduced the recession probability to 15%, its lowest in 3 years.

But in less than 6 months, they doubled the probability to 35%.

However, as an investor, our first reaction is to examine and not worry first.

So I decided to use AI to help me and the results are astounding to say the least.

In October 2022, the Goldman CEO said that there is reasonable chance of US recession, however the market went on a more than 60% run up since then.

And the most interesting prediction is Nov 2019, they proclaimed that 2020 global recession unlikely, only to see the market plummet 37% due to COVID.

Of course, it is not fair to expect Goldman Sachs to be correct all the time (who can predict a pandemic?).

However, it seems like They’re wrong more often than a broken clock. And even if they got it wrong, they can also claim that they got it right.

After all, predicting a 35% chance of recession happening, also means they are predicting a 65% chance of recession not happening. 😆 

It is truly a case of “I am never wrong”.

Then why is Goldman Sachs still making such predictions?

Easy, it is because the markets love it!

Humans are naturally wired to look for patterns. A reason to explain certain things.

So when the market loves it and you can never be wrong about it, it just incentivises them to continue to make such predictions and appear on headline news.

What I’m Doing Instead?

I am focusing on what is important.

1️⃣ Charts Don’t Lie: The S&P 500 is getting rejected by the 200MA.

Right now, we are seeing weakness in the price action in the SP500 as it gets rejected by the 200MA.

2️⃣ Earnings Still Shine: The good news is that corporate earnings are still rising amidst all these uncertainty with Trump tariffs.

3️⃣ Valuations Are Juicy: However, many companies are starting to sell at very attractive valuation.

I am definitely placing my finger on the BUY button, and waiting to strike. And my Stock Market Genius community will definitely be the first to know when I do!

If you want to learn how to invest profitably and be notify about my investments first like my SMG community, join us here

That’s all for this week! All eyes are on 2 April, lets see if Trump will really implement the tariffs.

Happy Hunting!

Pete
Invest with Pete

🚨‼️ By the way, I’ll never PM anyone on telegram or any other social media platforms. If you receive any “Pete” messaging you, these are scammers impersonating me. Pls beware!

The information provided in this newsletter is for informational purposes only and does not constitute financial advice. Readers should seek their own independent financial advice before making any investment decisions. Please note that while Pete is a portfolio manager, the opinions expressed in this newsletter are his own and do not represent the views of any organization. Always perform your own research and due diligence before investing.