May 6, 2025 | Lacy Hunt: Five Recessionary Forces

Dr. Lacy Hunt, Chief Economist at Hoisington Investment Management, analyzes what he calls an economic “interregnum” where five convergent forces are aligning to depress growth. Dr. Hunt methodically explains how tariffs will ultimately prove deflationary rather than inflationary, why the Fed’s restrictive monetary policy is misplaced, how federal spending cuts are creating headwinds, why massive debt overhang limits policy effectiveness, and how changing demographics will impact long-term prospects. With over 56 years of experience and historical perspective dating back to the 1920s, Dr. Hunt delivers a sobering but authoritative prediction that recession lies ahead in 2025, describing it as “a long, difficult slog” rather than a brief downturn. Here is a direct video link.

Hoisington’s Q1 2025 Review and Outlook is available here.

The current 9th period of negative M2 money supply referenced by Dr. Hunt in the segment above is shown below, since 1914 (with recessions marked in shaded bars).

Danielle Park May 6th, 2025

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