Risk of Recession

Here's a quick update on the risk of recession.

• The Wall Street Journal's survey of economists shows the risk of recession is believed to be about one chance in four, down from one chance in three in the survey taken two months earlier.
• The Philadelphia Fed's Survey of Professional Forecasters shows weaker base case forecasts, but a lower risk of a negative quarter. That risk, though, is still quite high.
• The San Francisco Fed has updated their assessment of the risk of recession. Here's their summary: 

In 2010, statistical experiments based on components of the Conference Board’s Leading Economic Index showed a significant possibility of a U.S. recession over a 24-month period. Since then, the European sovereign debt crisis has aggravated international threats to the U.S. economy. Moreover, the Japanese earthquake and tsunami demonstrated that the U.S. economy is vulnerable to outside disruptions. Updated forecasts suggest that the probability of a U.S. recession has remained elevated and may have increased over the past year, in part because of foreign financial and economic crises.

What should a business do about this risk? Glad you ask. Start by reading about recessions and business planning, then call me for some consultation.