Investors are making the wrong bet on a recession — and it's going to cost them big time

Thu, 04/27/2023 - 06:02

Stock exchange falling around the Wall Street Bull — Investors are betting that the US economy is going to suddenly fall into a recession and inflation is going to cool. But what happens if they're wrong?
J2r/iStock Photo; Andrii Shyp / Getty Images; Arif Qazi / Insider

How betting on a recession could wreck the market

A popular phrase among investors and analysts is "the bond market is always right." From predicting downturns to the Federal Reserve's next move, the bond market's historical forecasting track record and its "wisdom of the crowd" quality have given it a near-mythic reputation among Wall Street analysts.