{"id":557921,"date":"2026-04-01T09:19:16","date_gmt":"2026-04-01T09:19:16","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/557921\/"},"modified":"2026-04-01T09:19:16","modified_gmt":"2026-04-01T09:19:16","slug":"a-wall-street-vets-walmart-recession-indicator-just-hit-its-highest-point-since-2008-and-he-says-the-fear-just-keeps-multiplying","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/557921\/","title":{"rendered":"A Wall Street vet\u2019s Walmart recession indicator just hit its highest point since 2008\u2014and he says the fear \u2018just keeps multiplying\u2019"},"content":{"rendered":"\n

Forget the Fed. Forget nonfarm employment. Forget even industrial production and real income. For Jim Paulsen, the real recession indicator is watching Walmart<\/a>.<\/p>\n

Paulsen, former chief investment strategist at investment research firm the Leuthold Group, devised an indicator he dubs the \u201cWalmart Recession Signal\u201d (WRS), which tracks the stock price of Walmart against the S&P Global Luxury Index, a basket of 80 companies producing or distributing luxury goods. He said that since economic downturns are usually felt first by lower-income individuals, an increase in Walmart\u2019s stock price could indicate a potential economic downturn.<\/p>\n

Paulsen wrote in a Substack post<\/a> that the indicator is now at its highest level since the 2008 Great Recession. \u201c\u2018Walmart Worries\u2019 just keep multiplying,\u201d he wrote. \u201cIt\u2019s currently close to the highest level ever recorded, which was during the Great Financial Crisis of 2008\u201309.\u201d<\/p>\n

The central premise of the WRS is this: During economic downturns, consumers tend to shift their spending toward discount vendors like Walmart, and away from luxury retailers. It\u2019s one way households cut down on costs when economic pressure is high. \u201cAs economic activity slows and recession risk builds, retailing purchasing patterns tend to gravitate toward discounters like Walmart and away from luxury retailers,\u201d he wrote.<\/p>\n

Walmart\u2019s stock has climbed steadily over the past year, up over 40% year over year to $123.95 as of Tuesday afternoon. While the S&P Global Luxury Index is up over 7.7% year over year to $5,544.98, the price has fallen 13.6% since the beginning of the year.<\/p>\n

\"\" <\/p>\n

The economy occupies an increasingly precarious position as a string of back-to-back shocks has rattled it. A dismal February jobs report revealed<\/a> the economy unexpectedly shed 92,000 jobs, and the unemployment rate crept up to 4.5%. The Iran war has only added to the economic pressure weighing on Americans as oil and fertilizer prices are skyrocketing. Gas prices just surpassed $4 a gallon. On top of that, the housing market faces a dire<\/a> affordability crisis, and consumer sentiment<\/a> remains grim.<\/p>\n

All of these factors are crystallizing into a greater likelihood of a recession. Moody\u2019s Analytics just raised its recession outlook<\/a> for the next 12 months to 48.6%. That follows an increase from Goldman Sachs, which sets the likelihood<\/a> at 30%. And EY-Parthenon sets the odds of a recession at 40%.<\/p>\n

\u201cI\u2019m concerned recession risks are uncomfortably high and on the rise,\u201d said Mark Zandi, chief economist at Moody\u2019s Analytics. \u201cRecession is a real threat here.\u201d<\/p>\n

Walmart, which held the No. 1 spot on the Fortune 500 for 13 years before it was overtaken by Amazon<\/a> in February, has had a booming year. The company posted revenue of $190.7 billion last quarter, up 5.6% from a year ago. Revenue for the full year was up 4.7% to $713.2 billion.<\/p>\n

Paulsen said the WRS has had a close historical relationship with both annual real GDP growth and the unemployment rate. During successive economic downturns throughout the \u201990s and 21st century, the WRS rose before real GDP growth collapsed. He adds that every increase in unemployment has been preceded by an uptick in the WRS.<\/p>\n

As for the causes of what\u2019s impacting the WRS, Paulsen cites cratering consumer sentiment, dismal job postings, the impact of the Iran war, among other factors. He also warns that instead of a public credit crisis, the economy may be facing a private credit crisis, as the WRS also has a close historical relationship with the value of private credit.<\/p>\n

Yet Paulsen isn\u2019t betting on a recession happening just yet, saying the U.S. may be in the clear this year.<\/p>\n

But he adds, \u201cI am becoming more convinced that a significant U.S. economic slowdown is unfolding that will ultimately require additional economic policy accommodation and lower interest rates to arrest.\u201d<\/p>\n

This story was originally featured on Fortune.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Forget the Fed. Forget nonfarm employment. Forget even industrial production and real income. For Jim Paulsen, the real…\n","protected":false},"author":2,"featured_media":557922,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,247558,101,247557,247559,14443,4369,32227],"class_list":{"0":"post-557921","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economic-pressure","10":"tag-economy","11":"tag-jim-paulsen","12":"tag-luxury-retailers","13":"tag-recession","14":"tag-walmart","15":"tag-wrs"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/557921","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=557921"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/557921\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/557922"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=557921"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=557921"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=557921"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}