Sonders Says Recession Risk is Low

Although there are those that believe the U.S. is on the brink of recession, Liz Ann Sonders, Charles Schwab’s chief investment strategist, says the risk is low. This according to CNBC’s report on her commentary at the Morningstar ETF Conference in Chicago earlier this month. While Sonders says there are no clear buy signals at present, the market “could continue to grind higher, but not without drama. An ongoing secular bull market is still a decent bet.” While admitting that our economy is in turmoil, she differentiates between an economic recession and an earnings recession—what we’re facing now—which was caused […]

Billionaire Sam Zell Sees Recession Next Year

Billionaire real estate investor Sam Zell, who profited from selling just before the 2008 crisis and buying just after, predicts that global forces will lead to a U.S. recession next year. “I’m not being pessimistic, I’m being realistic,” he said. He also noted that Nigeria cut its economic growth projection for 2016 nearly in half, commenting “for an emerging market like that, it’s a disaster, and that’s happening all over the world.” He continued: “So, I just don’t think the U.S. can avoid it. Other real estate investors present similar, but less immediate, projections. James Connorof of Duke Realty noted […]

Is the Weakness in High Yield Signaling a Recession?

  The Wall Street Journal notes that U.S corporate high-yield bonds are down 2% this year, which would be only the fifth annual loss on a total-return basis since 1995. High-yield bonds are issued by heavily indebted companies that are more likely to default, and declines in their value can signal a coming downturn. George Bory of Wells Fargo Securities sees a “meaningful disconnect between equities and high yield.” Defaults on such bonds jumped from 2.1% to 2.6% and is predicted to rise to 4.3% in 2016 (above the 30-year average of 3.8% for the first time since 2009), according […]

Recession Over? Top Strategist Says ‘Yes’ — Cautiously

Liz Ann Sonders, the chief investment strategist for Charles Schwab & Co. — who accurately called the start of the current recession in December 2007 — says she thinks the recession is now over. But, she adds, don’t confuse that wiith “runaway optimism” about the economy. “I’ve been asked a lot, ‘please tell me when you think the turn has come,’” Sonders told 620WTMJ Radio of Wisconsin yesterday. “And I think the turn has come. … We may look back and see April, maybe May, as the end point, but that’s a guess based on my reading of the tea […]