What Will Cause the Next Recession?

James McDonald

Everyone is talking about it, and more and more investors are predicting it: the next recession. Most agree that it won’t look anything like the ruin of the 2008 financial crisis, rather that it will be a mild correction. But, what will catalyze the next economic event? There is less consensus in this category, but James McDonald, CEO and CIO of Hercules Investments, believes geo-political events will play a role.

“I think we’re most vulnerable to geo-political instability. There is a need for a trade deal with China, but we need to watch the protests in Hong Kong closely,” McDonald tells GlobeSt.com. “Political destabilization in Hong Kong could lead to an economic backlash that would potentially hit our bond and equity markets hard. Here in the states, if Trump lost the office due to scandal before the November 3, 2020 US Presidential election; or lost the election to a Candidate the market didn’t know or like, we could see a major stock market correction.”