The next recession: How bad will it really be?

Concerns of a potential US recession

JPMorgan Chase Chief Economist Anthony Chan on the outlook for the U.S. economy.

We may be in the midst of one of the longest economic expansion cycles on record, but the Great Recession is still at the top of many investors’ minds.

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As previously reported by FOX Business, the 2018 2Q Zillow Home Price Expectations Survey, found that surveyed economists and real estate experts expect the U.S. will enter a recession in 2020.

Most likely, the form of the next recession will be different.

Douglas Burtnick, Deputy Head of North American Equities at Abderdeen Standard Investments told FOX Business that market policy is good at fixing what causes problems. The last recession was triggered by loose credit conditions. Right now, the banks are good – they have high levels of capital.

He added that, “Some form of excess typical precedes a recession. Burt noted that “The economy is hot in a few places. Skilled labor in manufacturing, there are inflationary pressures. At Aberdeen Standard Investments, they expect reasonably stronger economic growth this year.

When asked if it the Fed’s monetary policy will cause the next recession, Burtnick said “The Fed has more information than anyone else. Right now, “The Fed has better info, the markets have better info (than when the last recession occured).”

When it comes to what opportunities there are for investors in the market right now, he said areas including manufacturing where companies input costs are up and they have had margin pressures for awhile. “Some of their stocks are attractive at current prices.”

There are some opportunities in the consumer staples space where there have been fundamental issues for, “A few years.”

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When asked if there are any sectors to stay completely away from, he commented, “It is harder to pick what to stay away from right now, noting that some people are saying tech, but he noted that there are winners and losers in tech.”