Lakshman Achuthan, co-founder and chief operations officer of the Economic Cycle Research Institute, says all of his economic indicators point to more sputtering ahead.
“The risk of a new recession is quite high,” he says, “the data should tell us the story by Thanksgiving.”
“Some economists argue that right now we are just in a period of slow growth, not unlike that of the early 1980s. They say there are signs of a turnaround in the near future. Achuthan argues there is no evidence to support that point of view.
“This is very different than the early 1980s. The issues that ail the U.S. economy and the jobs market today are not things that result from nearby events. What we’re living through and dealing with now has been building for decades,” he says. “If you look at the data, you see that the pace of expansion has been stair-stepping down ever since the 1970s, on all counts — on production, how much can we produce, how many jobs can we create, how much money do we make, how much do we sell. These are all trending down.”
So, Achuthan says, “those who were expecting we should have a vigorous recovery had no right to do so.”
In fact, he says, it is likely that the U.S. will see more frequent recessions than it’s used to for the next five or 10 years.
“The best news I can give you is that cycles do turn, but there is going to be a lot of pain in between,” he says.”