Wall Street analysts put their reputations at risk everytime they publish a forecast. And that risk rises exponentially when those forecasts go against the consensus.Few analysts have been more aggressive about their non-consensus calls than ECRI’s Lakshman Achuthan, who predicted in September 30, 2011 that the U.S. was heading for a recession and that it was “inescapable.”
Many have criticised him for being ambiguous with his timeline for that call.
But during a November 29 appearance on Bloomberg Surveillance with Tom Keene, Achuthan made it very clear that the U.S. recession began in the middle of this year and that we would know for sure that it began by the end of this year.
That was just under a month ago. We now have three days until the end of the year.
Achuthan’s recession call is based on the NBER’s definitiion, which considers production, employment, income, and sales. And we’re not sure if the folks at the NBER will be working over the next few days.
But if the NBER doesn’t make the call, will Achuthan’s reputation be crushed for good? Will he finally give in and say he was wrong? Will he say that the NBER is wrong?
It should be fun to see how this story, which began in September 2011, ends.
Here’s the chart Achuthan says proves that the recession started in the middle of this year: