Come on in, the water’s warm. That’s what a top Wall Street analyst is saying about this earnings season, arguing that it’s validating his long-running thesis that the economy was in a secret kind of recession that most economists just didn’t see for three years now. The robust third-quarter earnings season is revealing that his thesis of a “rolling recovery” for the economy is underway, with the “rolling recession” retreating into the past.
During the pandemic and its grinding aftermath, much of the U.S. private sector endured what Morgan Stanley strategists, led by chief equity analyst Mike Wilson, have labeled a “rolling recession”—a drawn-out downturn that escaped headline GDP but left deep marks in business hiring, earnings, and confidence. “Most of the private sector of the U.S. economy has not been hiring and/or has been trimming headcount for years,” the report from Nov. 3 notes, “so there is less need to be reactive to further slowing.”
