Market Musings 4/11/25: Don’t Speak
Don't tell me 'cause it hurts
Are you still feeling worried about the economy? Don't worry, this is a safe space.
While I have been very public with my U.S. recession calls, I’ve come to increasingly realize this week that many economists, analysts and executives have been self-censoring their pessimism way more than I realized.
I was taken aback reading a Bloomberg report from April 10th, on how a JPMorgan research analyst self-censored himself for the first time in his 30-year career.
In a report ironically titled “Redacted: Straight talk from the CEO front lines on Liberation Day” - it was visually jarring to see Cembalest black-out his own words as if they were classified intel from a top-secret FBI report.
“This is the first time I’ve ever had to do a call where I had to think about the things that I was saying, not just in terms of how they reflect our views on markets and economics,” Cembalest said.
Politico had a column on April 9th talking about the “wishcasting” many elected officials were doing by not sharing their true feelings on the economy.
Politics bureau chief Jonathan Martin described this “speak no evil” strategy with an analogy anyone who has cared for young children can surely relate to.
Martin likened this self-censorship to “a parent praising a toddler about what a big boy he is in hopes he won’t melt down and ruin dinner, or in this case the world economy,”.
But while “straight talk” is in short supply in D.C. and New York, maybe we need to head to the barbershops and beauty salons of America to find some much needed authenticity.
Bloomberg News reporter Ben Steverman, in an April 11th article entitled “The Beauty Salon Recession Indicator” covered the New York International Beauty Show. At this trade show for more than 32,000 professionals in the health and wellness industry, many were comfortable sharing their unfiltered thoughts.
Maryland massage therapist Christy Powers, said “It’s feeling a lot like 2008”.
Brookly aesthetician Cynthia Almonor said her clients were already “spending less because of the economy”. She made an allusion to the Global Financial Crisis, saying today reminded her of 2009 when many opted for “recession hair”, aka skipping the salon and booking appointments with their bathroom mirror.
As someone who identifies as a “Great Recession Millennial”, those testimonials brought back memories of a time some are choosing to forget. I began my finance career in 2008, the week Lehman Brothers went bankrupt, so I am no stranger to chaos.
But what worries me the most at the moment, is that I have never seen America’s “culture wars” bleed into the economics profession so blatantly as today. It is an ominous sign when even practitioners in non-partisan finance roles feel they must couch their words out of fear of retribution.
Until the bankers adopt the “real talk” that we're getting from the beauty salons, my conviction that the U.S. has already tipped into recession is only going to grow.
-Accrued Interest