KKR Predicts U.S. Recession By 2019 And An Inevitable Cycle Of Millennial Deleveraging

KKR has just published their 2017 mid-year economic outlook and it includes some rather dire predictions for the U. S. economy. Among other things, KKR predicts a U. S. recession by 2019 and a massive cycle of millennial deleveraging after a huge expansion of consumer credit in the form of student and auto loans.
Before getting into the details, here’s a chart depicting how KKR sums up the macro picture. In short, pretty much every major economic growth and asset valuation metric in the U. S. is flashing red warning signs relative to historical norms.
Today, almost all our work streams suggest that asset prices across most parts of the global capital markets are somewhere between fair value and expensive. From a cycle perspective, we believe that we are mid-to-later cycle in some of the more developed markets, including the United States.

This post was published at Zero Hedge on Jul 13, 2017.