I would like to hear your thoughts about these factors and if you think it is relevant for the stock market (understood that economy does not equal market)
# Retail Investor Perception: ~50%+ Recession Probability
* Recency bias from pandemic, inflation, and market trauma (2020-2022)
* Negative and sensationalist financial media tone
* Ongoing cost-of-living pressure despite easing inflation
* Confusion about yield curve and 'higher for longer' Fed policy
* Perceived disconnect between stock market highs and real-world struggles
* Fiscal concerns over national debt and deficits
* High-profile layoffs despite resilient job market overall
# Model-Based Reality: ~22-30% Recession Probability
* NY Fed model (10Y-3M spread): 30.4% probability (April 2025)
* 10Y-2Y yield curve: Positive spread (+0.49%) - low risk signal
* LEI (Leading Economic Index): Moderate decline, not recessionary
* Unemployment remains low, consumer spending slowing but not collapsing
* Recession probability estimates weighted across indicators: \~22%
* *(Source: NY Fed, Conference Board, FRED. Created with ChatGPT)*