As a Money Morning Member, you'll get our top financial news stories delivered straight to your inbox – every weekday morning.
Cancel at any time | How it works
Welcome to Money Morning - Only the News You Can Profit From.
Private Briefingwith WILLIAM PATALON III, Executive Editor
Not a member yet? Right now, you can get exclusive access to the 7 Best Stocks to Own in 2014. Click here.
Click here to get exclusive access to the 7 Best Stocks to own in 2014.
Members log in:
Not a member yet? Sign up here or learn more.
Chief Investment Strategist
33-year seasoned market analyst and professional trader with highly accurate track record. Specialty in global markets.
Global Energy Strategist
35-year expert in oil and gas policy, risk assessment, and emerging market economic development.
Capital Wave Strategist
30-year CBOE trader, market maker, and retired hedge fund honcho. Helped launch the Volatility Index in 1993.
20-year commodity guru and portfolio advisor. Top authority on metals + mining stocks. Head- quartered in Canada.
Defense + Tech Specialist
30-year veteran of tech markets with a Rolodex of Silicon Valley CEOs. Pulitzer nominee. Uncovered rare earths crisis.
30-year veteran analyst of business, economics, and financial markets. Award-winning author of "Contrarian Investing."
Don't worry about scanning headlines every day to determine the U.S. economy's chances of entering a recession in 2013.
We already know the answer.
Such indicators as gross domestic product (GDP), consumer spending, durable goods and exports all point to an economy not in a slow recovery, but on the verge of a 2013 recession.
That's because the trend lines, rather than showing gradual improvement, are moving in the opposite direction. The economy, after spending months with its head just barely above water, is about to go under.
The U.S. Commerce Department last week revised second quarter GDP sharply downward from 1.7% to 1.25%. The GDP was 1.9% in the first quarter of 2012. While we do not yet have any official data for the current quarter, a Federal Reserve Bank of Philadelphia survey of forecasters in August put the number at 1.6%.
That's an ominous pattern.
James Pethokoukis of the American Enterprise Institute explains: "Research from the Fed ... finds that since 1947, when two-quarter annualized real GDP growth falls below 2%, recession follows within a year 48% of the time. And when year-over-year real GDP growth falls below 2%, recession follows within a year 70% of the time."
There's actually a term for what we're experiencing: the "stall-speed economy." It's roughly defined as a period of two or more quarters in which the GDP remains mired below 2%.
And the headline GDP numbers only tell part of the story. All too many economic indicators are flashing a warning that growth will slow down even more.
Here are three pieces of the GDP that show how the economy is getting slammed from several directions:
In addition to the GDP data, there's plenty of other evidence pointing to a 2013 recession:
Even if such a tottering economy isn't quite weak enough to tip over on its own, all it takes is a little push from an external shock, such as the Eurozone debt crisis.
While recession 2013 may be inevitable, investors do have options - and time - to protect themselves.
The remaining content is exclusively for Money Morning subscribers. To gain access, enter your email address: