The economic chickens are coming home to roost. As most prognosticators were saying the chances of an economic contraction were slim to none, one may have already started. Read what the Elliott Wave Financial Forecast said two months ago:
We keep hearing about the soft-to-no-landing economic scenario. According to Polymarket’s prediction market, the chance of even a small economic contraction is disappearing. Expectations of a recession by May 2025 were already slim as of September 26, registering just 32%. Through the fourth quarter, however, they fell to almost non-existent, as the tally on Jan. 2 was 7%. This result contrasts sharply with the latest data from Equifax, which shows the dramatic extent to which consumers are already feeling the burden of over-indebtedness. In the first eleven months of 2024, total write-offs on consumer debt—auto, credit card, general finance, student and other retail loans—hit $128.7 billion, easily surpassing annual totals going back through 2012. In 2009, the year the Great Recession ended, Equifax’s non-mortgage, consumer loan write-off total was $130 billion, a difference of just 1% from the latest reading. So, consumers are in the unenviable position of having to begin the next economic contraction where they left off at the end of the last one:
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