Are We Heading for a Recession?

Does the following dire warning, issued last week, sound familiar?

“I see a precarious economy that is built on debt — both household debt and corporate debt. I see a number of serious shocks on the horizon that could cause our economy’s shaky foundation to crumble.”

It could have been said by super bear and FreedomFest regular Peter Schiff. In fact, he did say something similar in our Global Economic Summit at FreedomFest, but this doom-and-gloom prediction was made by Senator Elizabeth Warren.

Of course, ironically, she will be proven right, IF the United States adopts her policies such as forgiving student loans, providing universal health care and raising the minimum wage to $15 an hour.

In the past couple of months, there have been warning signs of a slowdown in the global and U.S. economy, especially in durable goods orders and manufacturing, both leading indicators.

Last month, the government announced that real gross output (GO), the broadest measure of economic spending, rose only 1.6% in the first quarter, much less than real gross domestic product’s increase of 3.1%. Total spending in the economy almost hit $45 trillion.

The supply chain (what the government calls intermediate inputs) declined slightly from the fourth quarter. If that trend continues, it would predict a recession ahead, and the end of the 11-year bull market.

But it’s still too early to tell if this will happen. I am watching this carefully, but for now we remain fully invested. For further updates on GO, go to www.grossoutput.com.

As said by Andrew Hunter, senior U.S. economist at Capital Economics, “We’ve been expecting the economy to slow over the course of this year for some time, mainly because of domestic factors.”

He added, “But I think the downside risks have really increased over the past few weeks with the escalation of trade tensions.”

The longer the trade war lasts with China, the more likely we will suffer a recession.

The stock market has held up well in the face of this threat, but that’s because interest rates have declined.

Eventually, if the trade war isn’t resolved, the stock market will tumble, too.  And that could spell trouble for President Trump’s chances for reelection.

What’s in Store for Next Year? ‘The Most Dangerous, Polarizing Figure Since Gandhi’

FreedomFest was a big hit this year, with nearly 2,000 attendees. For audio recordings, go to www.miracleofamerica.com.

We created quite a buzz when we announced our theme and keynote speaker for next year’s FreedomFest, which is scheduled for July 13-16, 2020, at the Paris Resort, Las Vegas. (Note that this is Monday through Thursday, not our usual end-of-the-week schedule.)

Watch the three-minute trailer here, and be prepared for the surprise keynote speaker, who has been called “the most dangerous, polarizing figure since Gandhi” and “the most important spokesman for liberty and civil justice since Milton Friedman.” The link and password to watch the video are https://vimeo.com/346787688 with password: ff2020.

When one of my students from Chapman University saw who the keynote speaker is for next year, he responded: “I must be dreaming. Unbelievable!!!!! You know I will be there in an absolute heartbeat! Every year, FreedomFest only gets better and better.”

Special Offer: $299, Are You Out of Your Mind?

At FreedomFest, we told attendees that they could sign up for next year’s big show for a one-time only super discount rate of $299 per person. Over 200 people signed up on the spot.

I am offering the same $299 price to my subscribers, but this one-time offer is available only until July 31. So hurry! You will never see this low price again. To join us, sign up at www.freedomfest.com, or call toll-free 1-855-850-3733, ext. 202.

Special note: my FreedomFest talk on “Call of the Wild West: Jack London, Rugged Individualist or Socialist?” will air at 1 a.m. EDT this Monday (11 p.m. PDT Sunday night) on C-SPAN BookTV. Other sessions from FreedomFest will air this weekend.

Fifty years ago, I was in Bogota, Colombia, as a Christian missionary and I snapped this photograph of Buzz Aldrin (back), Michael Collins (left) and Neil Armstrong (right), on their world tour in celebration of their landing on the moon on July 20, 1969.

Upcoming Appearances

Philadelphia MoneyShow, Sept. 26-28, Philadelphia 201 Hotel: I’ll be making a special appearance dressed as Ben Franklin! Other speakers include Ken Fisher, Dennis Gartman, Tom Sosnoff and John Buckingham. You can obtain free admission to the MoneyShow as my guest by calling 1-800-970-4355 and by mentioning pass code 048316.

Until then, good investing, AEIOU,

Mark Skousen