Gary Shilling: The U.S. Economy Still Faces a Recession Risk

Gary Shilling, a well-known financial analyst, has highlighted that while the U.S. economy has managed to stave off a recession thus far, the threat of an economic downturn remains. Shilling points to U.S. small businesses, traditionally sensitive to economic shifts due to their lower capitalization, as showing signs of strain by reducing employment and other activities. Despite these warning signals, a surprisingly robust labor market has played a crucial role in preventing a recession. The competition for workers during a labor shortage has led businesses to retain staff, thereby sustaining labor market strength. Shilling suggests that this resilience in the labor market has delayed, but not eliminated, the potential for a recession.