1 00:00:00,280 --> 00:00:05,239 Speaker 1: Investors don't love recessions. Bad things happen when the economy contracts. 2 00:00:05,840 --> 00:00:10,720 Speaker 1: Top line corporate growth stops, revenue and earnings fall. That 3 00:00:10,920 --> 00:00:16,000 Speaker 1: sends stock prices lower. Ever since the pandemic ended, lots 4 00:00:16,079 --> 00:00:20,440 Speaker 1: of investors fearing a recession was imminent have gotten scared 5 00:00:20,520 --> 00:00:25,080 Speaker 1: out of equity markets that any day now recession still 6 00:00:25,200 --> 00:00:29,560 Speaker 1: hasn't shown up. This is despite the prediction of many 7 00:00:29,800 --> 00:00:33,200 Speaker 1: well known economists over the past two years, there still 8 00:00:33,240 --> 00:00:36,839 Speaker 1: has been no recession. As it turns out, there are 9 00:00:36,960 --> 00:00:51,200 Speaker 1: ways investors can tell if an economic contraction is really coming. 10 00:00:52,080 --> 00:00:55,840 Speaker 1: I'm Barry Results and on today's edition of At the Money, 11 00:00:56,120 --> 00:01:00,680 Speaker 1: we're going to discuss how to accurately identify in advance, 12 00:01:00,880 --> 00:01:04,520 Speaker 1: in real time when the economy is going into recession. 13 00:01:05,080 --> 00:01:06,840 Speaker 1: To help us unpack all of this and what it 14 00:01:06,880 --> 00:01:10,640 Speaker 1: means for your portfolio, let's bring in Claudia Sam. She 15 00:01:10,800 --> 00:01:15,200 Speaker 1: is a former Federal Reserve economist and creator of what 16 00:01:15,319 --> 00:01:19,800 Speaker 1: has become known as the Sam Rule. Claudia, welcome to 17 00:01:19,840 --> 00:01:21,080 Speaker 1: Bloomberg's At the Money. 18 00:01:21,280 --> 00:01:22,119 Speaker 2: Happy to be here. 19 00:01:22,400 --> 00:01:24,959 Speaker 1: So let's start with the basics. Tell us what happens 20 00:01:24,959 --> 00:01:27,800 Speaker 1: to the economy during a recession. 21 00:01:28,880 --> 00:01:33,039 Speaker 3: A recession is a broad based contraction and economic activity. 22 00:01:33,240 --> 00:01:35,479 Speaker 3: So it's not about one industry, it's not about one 23 00:01:35,520 --> 00:01:38,160 Speaker 3: part of the country. It hits all of us, and 24 00:01:38,240 --> 00:01:43,240 Speaker 3: a recession hits hard. It's and that's why we want 25 00:01:43,240 --> 00:01:44,640 Speaker 3: to fight them. That's why we want to know if 26 00:01:44,640 --> 00:01:45,199 Speaker 3: they're coming. 27 00:01:45,680 --> 00:01:48,880 Speaker 1: So that obviously is not great. How long and deep 28 00:01:49,080 --> 00:01:51,440 Speaker 1: are the typical recessions. 29 00:01:51,480 --> 00:01:54,360 Speaker 2: It varies. It depends on what happened. 30 00:01:54,440 --> 00:01:58,000 Speaker 3: The global financial crisis in two thousand and eight, that 31 00:01:58,200 --> 00:02:01,760 Speaker 3: was a big, fast de recession that was very bad. 32 00:02:01,840 --> 00:02:05,000 Speaker 3: Two thousand and one, the bursting of the dot com bubble, 33 00:02:05,160 --> 00:02:08,639 Speaker 3: that's one of the mildest recessions that we've seen in 34 00:02:08,680 --> 00:02:11,200 Speaker 3: a very long time. So it depends on what hits 35 00:02:11,280 --> 00:02:13,959 Speaker 3: us as to how hard we go down. 36 00:02:15,120 --> 00:02:18,440 Speaker 1: Really interesting, it's funny you mentioned one because the year 37 00:02:18,480 --> 00:02:20,840 Speaker 1: before and the year after two thousand and two thousand 38 00:02:20,880 --> 00:02:23,720 Speaker 1: and two was one of those rare years where the 39 00:02:23,760 --> 00:02:28,360 Speaker 1: stock market was down even though there wasn't a recession. Surprisingly, 40 00:02:28,480 --> 00:02:31,480 Speaker 1: that was a fairly mild recession. Where did the two 41 00:02:31,560 --> 00:02:34,720 Speaker 1: thousand and one recession show up in the data? 42 00:02:35,280 --> 00:02:38,040 Speaker 3: In two thousand and one, we saw the unemployment rate rise, 43 00:02:38,120 --> 00:02:40,560 Speaker 3: not as much as in two thousand and eight or 44 00:02:40,600 --> 00:02:45,920 Speaker 3: in twenty twenty, and we did see GDP decline, though 45 00:02:46,120 --> 00:02:49,639 Speaker 3: it was not as severe as we've seen in other recessions. 46 00:02:50,160 --> 00:02:53,800 Speaker 1: So you developed an indicator what people call the Soalm rule, 47 00:02:54,120 --> 00:02:57,560 Speaker 1: to help us figure out in advance when recessions are 48 00:02:57,600 --> 00:02:59,160 Speaker 1: coming tell us about it. 49 00:03:00,080 --> 00:03:03,960 Speaker 3: UM looks for relatively small increases in the unemployment rate 50 00:03:04,040 --> 00:03:07,800 Speaker 3: to say we're in a recession. Specifically, we look at 51 00:03:07,840 --> 00:03:10,840 Speaker 3: the unemployment rate, the national unemployment rate, take the three 52 00:03:10,880 --> 00:03:13,560 Speaker 3: month average. We don't want to get faked out by 53 00:03:13,560 --> 00:03:16,840 Speaker 3: the bumps and wiggles. We compare the most recent reading 54 00:03:16,960 --> 00:03:19,760 Speaker 3: to the lowest of these three month averages over the 55 00:03:19,760 --> 00:03:22,520 Speaker 3: prior twelve months. If that difference is a half a 56 00:03:22,560 --> 00:03:26,040 Speaker 3: percentage point or more, we are in a recession. 57 00:03:26,680 --> 00:03:30,560 Speaker 1: So let me get a little more specific. How timely 58 00:03:31,040 --> 00:03:34,200 Speaker 1: is this indicator when it goes offen what's its track 59 00:03:34,240 --> 00:03:35,000 Speaker 1: record been like. 60 00:03:35,360 --> 00:03:38,400 Speaker 3: It has a perfect track record since nineteen seventies. It's 61 00:03:38,440 --> 00:03:42,600 Speaker 3: never triggered outside of a recession, and it's always triggered 62 00:03:42,640 --> 00:03:46,080 Speaker 3: early in one, far earlier than we would have the 63 00:03:46,120 --> 00:03:51,040 Speaker 3: official recession dating by the National Beer of Economic Research, 64 00:03:51,120 --> 00:03:55,840 Speaker 3: and it's within the first three four months of a recession. 65 00:03:55,880 --> 00:03:57,960 Speaker 2: And that also is before we would have the. 66 00:03:58,040 --> 00:04:01,080 Speaker 3: Two quarters of GDP that would typically be used to 67 00:04:01,120 --> 00:04:02,760 Speaker 3: say we're in a recession. 68 00:04:03,200 --> 00:04:06,240 Speaker 1: Although we've seen two negative quotas of GDP where we 69 00:04:06,360 --> 00:04:10,520 Speaker 1: haven't had recessions. That's not an official indicator anywhere. 70 00:04:10,520 --> 00:04:11,240 Speaker 2: It just seems to. 71 00:04:11,200 --> 00:04:15,120 Speaker 1: Be a rule of thumb that some countries use, but 72 00:04:15,160 --> 00:04:17,599 Speaker 1: we don't really use that here in the United States. Right, 73 00:04:17,800 --> 00:04:21,960 Speaker 1: we have the NBER and all of their many indicators 74 00:04:22,000 --> 00:04:22,640 Speaker 1: that they track. 75 00:04:23,480 --> 00:04:27,640 Speaker 3: What's amazing, and so many relationships have broken in this 76 00:04:27,920 --> 00:04:31,960 Speaker 3: COVID and the recovery that two quarters of a decline 77 00:04:31,960 --> 00:04:34,720 Speaker 3: in GDP that always happens in a recession. 78 00:04:35,040 --> 00:04:36,720 Speaker 2: You've got to go back to nineteen. 79 00:04:36,400 --> 00:04:38,960 Speaker 3: Forty seven to find a time where you have two 80 00:04:39,000 --> 00:04:41,880 Speaker 3: quarters outside of a recession. So that just shows one 81 00:04:41,880 --> 00:04:45,400 Speaker 3: should be really careful right now with the rules of 82 00:04:45,440 --> 00:04:46,880 Speaker 3: thumb that have worked in the past. 83 00:04:47,080 --> 00:04:49,640 Speaker 1: Right, you can find a good parallel between the post 84 00:04:49,680 --> 00:04:53,240 Speaker 1: war era and the post pandemic era, giant fiscal stimulus, 85 00:04:53,240 --> 00:04:56,560 Speaker 1: et cetera. But let's stick with the some rule for 86 00:04:56,560 --> 00:05:01,040 Speaker 1: a moment. Most economic rules that I'm familiar with, they're 87 00:05:01,040 --> 00:05:03,960 Speaker 1: pretty complex. They rely on a lot of moving parts. 88 00:05:04,400 --> 00:05:08,400 Speaker 1: The SAM rule seems fairly simple. A single labor market indicator. 89 00:05:09,000 --> 00:05:14,839 Speaker 1: Is that oversimplifying the complexity of the economy, or do 90 00:05:15,040 --> 00:05:18,040 Speaker 1: all roads in the economy lead to the labor market? 91 00:05:18,960 --> 00:05:22,320 Speaker 3: This SAM rule is simple by design. Its purpose was 92 00:05:22,480 --> 00:05:27,800 Speaker 3: to say, hey, Congress, send out the stimulus checks and frankly, 93 00:05:27,839 --> 00:05:30,080 Speaker 3: do it automatically. Just tie it to the same rule. 94 00:05:30,400 --> 00:05:32,720 Speaker 3: That's why it exists. It's been used for a lot 95 00:05:32,720 --> 00:05:36,560 Speaker 3: of other purposes recently, and so but I will say, 96 00:05:36,880 --> 00:05:39,040 Speaker 3: there's a saying among economists, if you had to be 97 00:05:39,080 --> 00:05:41,039 Speaker 3: on a desert island and you can only have one 98 00:05:41,120 --> 00:05:43,839 Speaker 3: data series to tell you what the US economy is doing, 99 00:05:44,640 --> 00:05:48,479 Speaker 3: it's the unemployment rate. Is it tells us so much 100 00:05:48,640 --> 00:05:50,440 Speaker 3: for a lot of different reasons. It tells us so 101 00:05:50,520 --> 00:05:53,360 Speaker 3: much about where we are, and frankly, as you see 102 00:05:53,360 --> 00:05:56,040 Speaker 3: it start to drift up, it can tell us where 103 00:05:56,080 --> 00:05:59,280 Speaker 3: we're headed. It's not a perfect signal, but it is 104 00:05:59,320 --> 00:06:02,280 Speaker 3: something to say, Yeah, it's even before the summ will 105 00:06:02,320 --> 00:06:04,160 Speaker 3: with trigger you should pay attention to it. 106 00:06:04,279 --> 00:06:06,279 Speaker 1: So let's talk a little bit about that. You know, 107 00:06:06,400 --> 00:06:11,760 Speaker 1: since since the pandemic ended, it seems almost immediately after 108 00:06:11,800 --> 00:06:15,760 Speaker 1: the recovery began, we began hearing about a recession. This 109 00:06:15,839 --> 00:06:18,680 Speaker 1: is already going on for two years. It's imminent, it's 110 00:06:18,720 --> 00:06:22,600 Speaker 1: about to happen. And as that drum beat has gotten louder, 111 00:06:23,200 --> 00:06:27,120 Speaker 1: inflation has gone down, Unemployment has fallen, consumer spending has 112 00:06:27,560 --> 00:06:31,040 Speaker 1: remained robust, even wage gains have gotten better. If anything, 113 00:06:31,080 --> 00:06:36,919 Speaker 1: the economy has improved. Why this constant drumbeat that a 114 00:06:36,960 --> 00:06:38,040 Speaker 1: recession is imminent. 115 00:06:39,760 --> 00:06:43,000 Speaker 3: Many economists, many of my peers, got stuck in the 116 00:06:43,080 --> 00:06:47,800 Speaker 3: nineteen seventies, and in the we've had inflation went up, 117 00:06:47,880 --> 00:06:50,000 Speaker 3: I mean legitimately in twenty twenty one, that was the 118 00:06:50,040 --> 00:06:52,120 Speaker 3: first time in a long time we'd seen. 119 00:06:52,520 --> 00:06:55,680 Speaker 2: Inflation about it spiked, it went up fast. 120 00:06:56,400 --> 00:07:00,520 Speaker 3: The wisdom if you knew nothing else and just saw 121 00:07:00,520 --> 00:07:03,040 Speaker 3: inflation going up, typically you'd say, oh, okay, the federal 122 00:07:03,040 --> 00:07:03,960 Speaker 3: reserves got to step in. 123 00:07:04,000 --> 00:07:05,320 Speaker 2: They got to raise interest rates. 124 00:07:05,760 --> 00:07:07,839 Speaker 3: And in the past, when the Fed has done that, 125 00:07:08,360 --> 00:07:10,360 Speaker 3: it ends up in a bad place, right Like, it's 126 00:07:10,360 --> 00:07:13,960 Speaker 3: hard to do that. What I had, the point I 127 00:07:14,040 --> 00:07:16,800 Speaker 3: had made the entire time, was that most of that 128 00:07:16,840 --> 00:07:20,560 Speaker 3: inflation was coming from disruptions from COVID. And as we 129 00:07:20,640 --> 00:07:23,360 Speaker 3: went into twenty twenty two. There were also disruptions from 130 00:07:23,360 --> 00:07:27,760 Speaker 3: Putin invading Ukraine. That's not demand, that's not what interest 131 00:07:27,880 --> 00:07:31,600 Speaker 3: rates solve. J Powell did not unload the docks in 132 00:07:31,800 --> 00:07:34,480 Speaker 3: la he didn't take a second job, he didn't give 133 00:07:34,520 --> 00:07:37,160 Speaker 3: the vaccine out. These are all things that needed to 134 00:07:37,200 --> 00:07:38,720 Speaker 3: happen to get inflation down. 135 00:07:39,280 --> 00:07:42,280 Speaker 2: It has been so slow to get back on track. 136 00:07:42,360 --> 00:07:46,320 Speaker 3: And yet twenty twenty three, which we were told was impossible, 137 00:07:47,000 --> 00:07:52,680 Speaker 3: massive declines in inflation, unemployment at its lowest in you know, 138 00:07:52,720 --> 00:07:55,800 Speaker 3: since the nineteen sixties. That shouldn't have happened, and yet 139 00:07:55,800 --> 00:07:58,320 Speaker 3: it made perfect sense if you thought about, Hey, there 140 00:07:58,320 --> 00:07:59,040 Speaker 3: was a pandemic. 141 00:07:59,120 --> 00:08:00,520 Speaker 2: Hey there was a war in Europe. 142 00:08:01,160 --> 00:08:04,200 Speaker 3: So that's what has worked out, and that's what puts 143 00:08:04,240 --> 00:08:07,360 Speaker 3: us on a path to the elusive soft landing. 144 00:08:07,720 --> 00:08:12,680 Speaker 1: So, to paraphrase James Carvill, it's the pandemic stupid. Huh. 145 00:08:13,320 --> 00:08:16,680 Speaker 1: So what other periods are there in history that are 146 00:08:16,840 --> 00:08:19,960 Speaker 1: kind of comparable to what we've experienced over the past 147 00:08:20,040 --> 00:08:23,920 Speaker 1: year or two where there are all these recession warnings 148 00:08:23,960 --> 00:08:25,240 Speaker 1: and yet no recession. 149 00:08:26,560 --> 00:08:31,880 Speaker 3: Recessions aren't supposed to be forecastable, So for two years 150 00:08:31,920 --> 00:08:37,040 Speaker 3: to have recession calls so loud has been a little 151 00:08:37,360 --> 00:08:40,439 Speaker 3: mind blowing, right, Like, we're not supposed to know when 152 00:08:40,520 --> 00:08:44,440 Speaker 3: these are coming, and we're certainly not supposed to be 153 00:08:44,520 --> 00:08:48,200 Speaker 3: so certain about it. You'd have to go it's like 154 00:08:48,320 --> 00:08:52,560 Speaker 3: outside of living memory to find episodes of inflation, like 155 00:08:52,600 --> 00:08:58,200 Speaker 3: what we're seeing after the two World Wars, after the pandemic. 156 00:08:58,200 --> 00:09:00,280 Speaker 3: I mean, these are places we don't have very good 157 00:09:00,400 --> 00:09:04,000 Speaker 3: data in terms, and we obviously don't have experience with them. 158 00:09:04,760 --> 00:09:09,280 Speaker 3: So to gravitate back to the nineteen seventies, the vulgar fed, 159 00:09:09,640 --> 00:09:12,439 Speaker 3: you know, the early eighties, it makes sense why that's 160 00:09:12,480 --> 00:09:14,559 Speaker 3: where people go, because that's where we have data, that's 161 00:09:14,559 --> 00:09:15,400 Speaker 3: where we studied. 162 00:09:15,880 --> 00:09:17,120 Speaker 2: But like that's not what This. 163 00:09:17,240 --> 00:09:20,120 Speaker 1: Is very different world in the seventies and today. So 164 00:09:20,480 --> 00:09:23,640 Speaker 1: you mentioned we don't have a giant data set. What 165 00:09:23,679 --> 00:09:27,840 Speaker 1: if we had seventeen recessions in the past century and change. 166 00:09:28,440 --> 00:09:33,200 Speaker 1: Given that we can't be generally confident about recession forecasts, 167 00:09:33,800 --> 00:09:36,320 Speaker 1: how confident should we be in the sam rule You 168 00:09:36,559 --> 00:09:39,440 Speaker 1: actually had discussed, Hey, maybe it's not going to be 169 00:09:39,520 --> 00:09:40,240 Speaker 1: right this time. 170 00:09:40,760 --> 00:09:44,080 Speaker 3: Absolutely, if the sawmo we're going to break, it would 171 00:09:44,080 --> 00:09:46,800 Speaker 3: be this time and break in the sense that we 172 00:09:46,880 --> 00:09:50,480 Speaker 3: could hit that half a percentage point trigger, and then 173 00:09:50,840 --> 00:09:53,600 Speaker 3: the unemployment rate doesn't really rise that much more. We 174 00:09:53,640 --> 00:09:57,720 Speaker 3: don't go into recession. Typically after the sawwar triggers, you 175 00:09:57,840 --> 00:10:01,559 Speaker 3: have almost a four percentage point increase in unemployment relative 176 00:10:01,600 --> 00:10:04,240 Speaker 3: to the low two thousand and one that was the smallest, 177 00:10:04,280 --> 00:10:07,800 Speaker 3: and it was even still two percentage points, so it 178 00:10:07,840 --> 00:10:11,360 Speaker 3: would be very not usual for you to get up 179 00:10:11,400 --> 00:10:13,079 Speaker 3: to four percent, which we kind of have to hang 180 00:10:13,080 --> 00:10:15,120 Speaker 3: around four percent for a while to have it trigger 181 00:10:15,480 --> 00:10:18,559 Speaker 3: and then just kind of hang there and maybe come 182 00:10:18,600 --> 00:10:21,280 Speaker 3: back down later. There's a very good case for why 183 00:10:21,320 --> 00:10:24,280 Speaker 3: this could happen. It goes back to these disruptions of COVID. 184 00:10:24,760 --> 00:10:28,120 Speaker 3: We know it's taken the labor market time to heal too. 185 00:10:28,160 --> 00:10:30,480 Speaker 3: We had all these labor shortages. We need to bring 186 00:10:30,520 --> 00:10:33,880 Speaker 3: people back in. Millions of people walked away from jobs 187 00:10:33,920 --> 00:10:36,400 Speaker 3: because of caregiving because they didn't want to die, and 188 00:10:36,440 --> 00:10:41,200 Speaker 3: we stopped processing immigrant work visas. So these things are happening. 189 00:10:41,240 --> 00:10:44,240 Speaker 3: There's this kind of catch up now. Now it's like 190 00:10:44,600 --> 00:10:46,760 Speaker 3: there's more people and the jobs have to catch up, 191 00:10:46,840 --> 00:10:49,160 Speaker 3: versus in the labor shortage it was the other way around. 192 00:10:49,960 --> 00:10:53,199 Speaker 3: That just can make things really messy, and again if 193 00:10:53,200 --> 00:10:55,400 Speaker 3: the summer we're ever going to break, it's this time. 194 00:10:55,679 --> 00:10:58,840 Speaker 3: And frankly, we have seen relationships breaking left and right, 195 00:10:58,960 --> 00:11:00,960 Speaker 3: so I would in good company. 196 00:11:01,280 --> 00:11:04,840 Speaker 1: So let's talk about the things that have broken in 197 00:11:04,920 --> 00:11:09,880 Speaker 1: the post pandemic era. We've seen shortages of single family homes, 198 00:11:09,960 --> 00:11:13,360 Speaker 1: we've seen shortages of semiconductors. Is still a long way 199 00:11:13,480 --> 00:11:17,480 Speaker 1: to get a new automobile, and it appears that we're 200 00:11:17,520 --> 00:11:22,359 Speaker 1: still dealing with a labor shortage. How many more workers 201 00:11:22,400 --> 00:11:26,600 Speaker 1: does this country need to reduce some of the tightness 202 00:11:26,640 --> 00:11:27,720 Speaker 1: in the labor market. 203 00:11:28,679 --> 00:11:31,520 Speaker 3: We started to make a good bit of progress in 204 00:11:31,559 --> 00:11:34,160 Speaker 3: the second half of last year in terms of getting 205 00:11:34,240 --> 00:11:39,520 Speaker 3: workers back and in some cases even better than before. 206 00:11:39,960 --> 00:11:45,760 Speaker 3: Women's prime age employment is at record highs, the percent 207 00:11:46,080 --> 00:11:50,560 Speaker 3: of workers with disabilities who have jobs record high, and 208 00:11:50,600 --> 00:11:54,320 Speaker 3: even some very marginalized groups, like black men, their labor 209 00:11:54,320 --> 00:11:57,679 Speaker 3: force participation has looked great. The black unemployment rate has 210 00:11:57,720 --> 00:12:02,520 Speaker 3: been low. We need these groups to come in not 211 00:12:02,720 --> 00:12:05,400 Speaker 3: just to make up the whole that the pandemic created, 212 00:12:06,080 --> 00:12:09,040 Speaker 3: but to keep it going. In terms of the labor 213 00:12:09,080 --> 00:12:11,880 Speaker 3: market is really strong right now, and that's a good thing, 214 00:12:11,880 --> 00:12:14,359 Speaker 3: and it's one that we need to build on. Because, 215 00:12:15,280 --> 00:12:18,280 Speaker 3: as you said, like, there's still a need for talent 216 00:12:18,400 --> 00:12:22,400 Speaker 3: and productivity, and that was the big kind of under 217 00:12:22,400 --> 00:12:23,880 Speaker 3: the hood story of last year. 218 00:12:24,480 --> 00:12:27,199 Speaker 1: So I want to leave investors with a little bit 219 00:12:27,200 --> 00:12:31,000 Speaker 1: of advice from the creator of the some rule. Tell 220 00:12:31,080 --> 00:12:34,640 Speaker 1: people what they should be looking for if they really 221 00:12:34,720 --> 00:12:40,160 Speaker 1: want to have the best way of anticipating a potential recession. 222 00:12:39,800 --> 00:12:42,640 Speaker 3: Keep your eyes on the labor market. The labor market 223 00:12:42,800 --> 00:12:48,000 Speaker 3: is so essential to American consumers. Like your paycheck, that's 224 00:12:48,000 --> 00:12:50,840 Speaker 3: what you spend. So if we lose the labor market, 225 00:12:50,880 --> 00:12:53,720 Speaker 3: we lose consumers. If we lose consumers, we're done. 226 00:12:53,840 --> 00:12:57,080 Speaker 1: And that's how we get a recession and typically a 227 00:12:57,120 --> 00:13:03,079 Speaker 1: week stock market. So to wrap up, investors who are 228 00:13:03,080 --> 00:13:06,480 Speaker 1: concerned about all these recession calls we've been hearing about 229 00:13:06,800 --> 00:13:10,720 Speaker 1: for the past two years should just ignore them. And 230 00:13:10,800 --> 00:13:14,360 Speaker 1: if you really want to know when a recession is coming, 231 00:13:15,000 --> 00:13:18,280 Speaker 1: keep your eye on the unemployment rate. When the three 232 00:13:18,400 --> 00:13:21,800 Speaker 1: month moving average ticks up zero point five to zero 233 00:13:21,800 --> 00:13:27,040 Speaker 1: of a percentage point relative to its previous twelve month low, 234 00:13:27,800 --> 00:13:31,280 Speaker 1: that's a warning sign. Get ready for a possible recession. 235 00:13:31,840 --> 00:13:35,400 Speaker 1: I'm Barry Ritolts and this is Bloomberg's at the month. 236 00:13:35,440 --> 00:13:43,480 Speaker 2: Oh, you got your things today.