Analyst Warns U.S. ‘Definitely’ Headed Towards Recession

Appearing Tuesday on the Fox Business Network, Stephen Schork, principal of The Schork Group, painted a bleak picture of the U.S. economy.

A transcript is as follows:

MARIA BARTIROMO: Your reaction to these moves in terms of gasoline pulling back? Do you see that as a positive for a longterm move?

STEPHEN SCHORK: At $4.96, absolutely not. We’re still at unprecedented levels at this point. It’s at levels that Americans simply cannot afford. When we look at the current rate of inflation, real disposable income, what we actually have to spend in this high priced environment, is now growing at the fastest pace in 10 years. Our savings rate is at the lowest point in 14 years, and credit card debt is growing at the fastest pace in 10 years. So clearly, we are running out of money and accumulating debt. As a matter of fact, our debt being held on credit cards is over one trillion dollars, which is an all-time record.

My fear going into the summer is people are so fed up with COVID that they’re going to go on their vacation and continue to spend come heck or high water because of cabin fever and reconcile the bills when they come due in the fall. That said, we’ve never had an environment like this before with not just these high prices at the pump but, more importantly, at the grocery counter, and we’ve never avoided recessions. We are on the cusp of recession if we’re not already in recession. But bygone, we are definitely headed towards a recession.