Nathan Sheets, Citi Global chief economist, joins ‘Squawk on the Street’ to discuss his thoughts on the current economic standing in the U.S., how markets will react to lower corporate profits next year, and what’s changed in the economist’s soft landing forecast….(read more)

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Citi’s Chief Economist Nathan Sheets has made headlines recently by sticking to his prediction of an impending recession despite signs of a strong economy. Many analysts and investors have questioned Sheets’ stance, but he remains firm in his belief that a recession is on the horizon.

One of the main reasons Sheets is holding on to his recession call is the ongoing trade tensions between the United States and China. The trade war has caused uncertainty and volatility in the markets, and Sheets believes that it will eventually take a toll on the global economy. With tariffs and retaliatory measures escalating, Sheets sees a potential slowdown in global trade and economic growth.

Another factor in Sheets’ recession call is the tightening of monetary policy by the Federal Reserve. The central bank has been gradually raising interest rates, which could dampen overall economic activity and potentially lead to a recession. Sheets believes that the Fed may have to reverse its course and cut interest rates to stimulate the economy, but this could come too late to prevent a recession.

Sheets also points to financial imbalances and vulnerabilities in the global economy that could trigger a recession. A buildup of debt and leverage in various sectors, such as corporate borrowing and emerging market economies, could exacerbate any economic downturn and lead to a recession.

Despite the strong performance of the U.S. economy in recent years, Sheets remains cautious and reiterates his prediction of a recession in the near future. While many may disagree with his stance, it is important to consider the various risks and uncertainties that could potentially derail the current economic expansion.

It is worth noting that economic predictions are inherently uncertain, and there is no way to accurately predict when a recession will occur. However, Nathan Sheets’ steadfastness in his recession call serves as a reminder that there are always potential risks and vulnerabilities in the global economy, and it is important to remain vigilant and prepared for any economic turbulence. Only time will tell whether Sheets’ prediction will come to fruition, but for now, his hold on the recession call is a reminder to investors and policymakers to consider the potential downside risks in the current economic environment.