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What's going on, guys? It is Sunday, July 9th, and that means it's time for Long Read Sunday.

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Hello friends. Today for Long Read Sunday, we are reading a thread from Alex Kruger, which is the

summarization of research from his firm Asgard markets. In many ways, it's all about a recession

that seems like it's upcoming, and I think what makes

this such an interesting discussion is two things. First of all, for the last couple years,

basically ever since we started raising interest rates, a recession has loomed large as the

thing that was right around the corner. At many points, Wall Street has been rooting

for a recession, thinking that it was the only way to get Powell off of his interest hiking cycle.

Yet, at the same time, we don't really have a mental model for a recession that isn't predicated

on a financial crisis. For most of modern memory, recessions have been the fallout of emergency

events, rather than just a normal part of the business cycle. Indeed, one of the warppings of the

zero interest rate era was the fact that we weren't allowed to really have recessions in the

same way. Because of that, it doesn't really seem like people have great models mentally or

economically for what a recession might actually look like, and so I think this sort of research Because of that, it doesn't really seem like people have great models mentally or economically

for what a recession might actually look like.

And so I think this sort of research is really valuable in that light.

So this was originally tweeted by Alex Kruger at Kruger Macro on July 3rd.

Let's dive in.

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