Taps Coogan – May 20th, 2022

Enjoy The Sounding Line? Click here to subscribe for free.

Conference Board trustee and former vice chairman of the Federal Reserve, Roger Ferguson, recently spoke with CNBC to discuss the Conference Board’s recent CEO Sentiment survey results which now show that a majority of CEO’s now expect a recession in the US. The survey’s corresponding index clocked in at ’42’ well below the ’50’ reading that denotes neutral growth and a dramatic drop from the last reading of ’57.’

 

Some excerpts from Roger Ferguson:

“I think what’s going on is a building up of all these pressures… and the CEOs are basically saying ‘every time we look at it, things seem to be more challenging, more difficult…”

“That reading below ’50’ (in the CEO survey) is consistent with slowing for sure… When we look back historically, we’ve seen readings below 40 are where we get into much more challenging recessionary kinds of territories. So right now the CEO’s are saying we’re expecting difficult times, we’re really expecting slowing…”

“Inflation pressures are still there… there are surveys of consumers that show that they are changing their buying behaviors, that they no longer believe that this is a good time to buy those big ticket items. We’ve seen inflation pressures change consumer demand to store brands instead of those nationally known brands… The combination of inflation that is much too high and wages that are increasing but not keeping up with inflation and the inability to pass all this along is creating a very very challenging dynamic.”

As we noted recently, it’s time to pull forward the recession/recession-scare from sometime next year to sometime in the next few months. 

Would you like to be notified when we publish a new article on The Sounding Line? Click here to subscribe for free.