But you saw large declines in areas that were unexpected, like shelter inflation. And you know, some of this economic pain that you usually feel in housing is going to start to feed into lower economic activity. Talking about it all is Jeff Schulze, Investment Strategist at ClearBridge Investments and architect of their Anatomy of a Recession program. So, yes, mortgage rates have doubled.
There was very negative investor sentiment, as evidenced by the American Association of Individual Investors Survey, better known as the AAII, which is the gold standard for retail sentiment. And there's a very strong relationship with this measure and consumption. Jeff Schulze: Housing's in a recession. So, I think a cooler labor market on the back of lower job openings is that second leg in the stool. Clearbridge investments anatomy of a recession. Listen on any streaming service or visit to learn more. So when we do see this choppiness, definitely want to try to take advantage of it. Now, it may feel like an eternity ago when we have started this rate cycle, but it's only been nine months. When it comes to the labour markets, an object in motion tends to stay in motion, and you very rarely get a small rise in the unemployment rate. So, given the fact that earnings have just started to move down, this is likely the next shoe to drop and likely to be priced in the markets as we move through the next couple of quarters. 6% between green and the market peak that occurred prior to the recession. The markets and the economy will transition toward the Federal Reserve Board's 2% target and stabilize by the end of 2023, a stability that could continue for the next few years.
Anything of note on this particular topic? 5 In fact, these are the three strongest quarters out of the 16 quarters of the presidential cycle. Now, in thinking about every bear market, there's usually two phases to one of those. The anatomy of a recession. And the fact that on a year-over-year basis, it's at -6% in that survey. Rapidly changing economic and market conditions could lead to a shift in strategy for income investors. 5% on an annualized basis during the period between green and the next recession, and an even stronger 10. In order for the Fed to really break the labour market, they need to break small business labour demand. And Powell basically said that it's a very plausible scenario.
And so far this year they're only down close to 4% from peak. Jeffrey Schulze, CFA. And the dashboard has seen quite a bit of degradation since the middle part of 2022. It just continues to be a story about labor market as the last domino to fall.
But if inflation data continues to come down and wage growth cools, the Fed could potentially stop raising rates and pause even though I don't think rate cuts are forthcoming. But given the Fed's [US Federal Reserve's] focus on restoring price stability in the US economy, even if it meant a higher unemployment rate and a recession, we decided to foreshadow our expectation for a yellow overall signal in the coming months. But importantly, in talking about the dashboard, it's very rare to see such a quick economic progression to recession, and this has perfectly coincided with the Fed amping up its hiking cycle to 75 basis points per meeting. 6% on the quits rate, but that's still the highest that you'd ever seen in that data set prior to the pandemic. Talking Markets with Franklin Templeton: Anatomy of a Recession: Why a US Recession is Unlikely Near-Term on. It combines not only wages, but hours worked. So, we're not there yet. 6 So, as you move through the midterms and you get more visibility on the fiscal environment, markets tend to move higher, and they don't look back. History, as well as supportive consumer and business fundamentals, suggest another elongated expansion could be on the cards. And I think a lot of people forget that we're over seven and a half months away from when we entered into bear market territory. Now let's go to that Recession Risk Dashboard. And the key difference between those periods is that in 1966, you had an extremely tight labour market with the unemployment rate at 3.
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