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Economic outlook darkens as key indicators point to deterioration in 2023

Economic outlook darkens as key indicators point to deterioration in 2023
Ana Zirojevic

As many investors and financial experts continue to warn of a looming wide-reaching recession, the leading economic indicators, based on their chart patterns and behavior in the last 30 years, suggest that the global economy is, indeed, likely to worsen this year.

In fact, the year-over-year changes in the stock market performance (the S&P 500 Index) and the leading economic indicator of the global think-tank and business organization Conference Board are contracting, according to the data shared by finance analyst Game of Trades on June 7.

Historical similarities

Specifically, their contraction fits the levels that the world had seen during the three heavily influential events on the global financial scene – the Dot-com Bubble of 1995-2000, the Great Recession of 2007-2009, and the Covid-19, as the analyst’s chart shows. 

Leading economic indicators YoY. Source: Game of Trades

In late May, Game of Trades shared the six-month changes in the Conference Board’s “10 indicators that cover a wide range of economic activity, including job growth, housing construction, and stock prices” since 1960, stating their current contraction trend matched recessions in prior decades.

Recession fears

Meanwhile, one of the notable people that has often warned about the failing economy is Robert Kiyosaki, the author of the best-selling personal finance book ‘Rich Dad Poor Dad,’ who recently said that the United States was “sitting on the edge of a great depression,” after Germany slipped into a recession.

Indeed, the financial educator has wondered whether other countries, including the US, could follow the decline of the largest economy in the eurozone, suffering the same fate as several banking giants in the previous months, as Finbold reported on May 26.

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