Citi says 65% Chance of recession next year
 

Do you think this is a scare tactic I'm posting, or a reality check!! (This post was copied and pasted from a poster on UAL pilots forum btw)

Watch For U.S. Recession, Zero Interest Rates In China Next Year, Citi Says


By Jamie McGeever

LONDON (Reuters) - The outlook for the global economy next year is darkening, with a U.S. recession and China becoming the first major emerging market to slash interest rates to zero both potential scenarios, according to Citi.

As the U.S. economy enters its seventh year of expansion following the 2008-09 crisis, the probability of recession will reach 65 percent, Citi's rates strategists wrote in their 2016 outlook published late on Tuesday. A rapid flattening of the bond yield curve towards inversion would be an key warning sign.

"The cumulative probability of U.S. recession reaches 65 percent next year," Citi's rates strategists wrote in their 2016 outlook published late on Tuesday. "Curve inversion will likely come more quickly than the consensus thinks."

Normally, short-dated yields such as two-year yields are lower than longer-dated ones like 10-year yields, as investors demand a premium for taking on risk several years into the future. The curve has inverted before each of the last five U.S. recessions since the mid-1970s.

In China, deflationary pressures and downside risks to growth will force Beijing to loosen fiscal policy, let the yuan depreciate and perhaps become the first major emerging market economy to cut interest rates to zero, Citi said.

From Bill Gross, probably the greatest bond investor of all time:
Bill Gross urges investors to gradually de-risk portfolios

My theme song! Well, that and this.....

https://www.youtube.com/watch?v=lPaE0orK5gE

"forget about all that macho chit, and learn how to play guitar!"

Take the pay raises when you can get em, because 2 years down the road it will be a totally different story!

And with oil at $20 UA will still be awash is cash. If you let fear decide for you, why would you ever vote no to any contract offer?

Oil Prices Could Drop to $20 a Barrel Next Year - Fortune

You're right. We may be in better financial condition than we are today.

Competition chases easy money and high returns. With cheap oil, the 300's and 500's will come out of the desert by the hundreds if not thousands.

50 seat RJ's are probably just about free. 20 dollar oil makes a free airplane that burns a lot of gas competitive.

All the low cost guys are growing 8+ percent a year. While the majors are employing "capacity discipline". I wonder how this will turn out.....

Interesting reading about why Saudi is not cutting production:

Why is Saudi Arabia lowering the price of crude oil?
https://www.quora.com/Why-is-Saudi-A...e-of-crude-oil

Another interesting reading, not about oil but about recession. From the Jerome Levy Forecasting Center (David Levy predicted 2008, his grandpa predicted 1929):

Why the Global Economy Is Facing Recession

Why do you assume that a yes vote to this AIP can only be out of fear?