According to celebrity investor Kevin O'Leary, the US economy is considerably stronger than people believe, and there is "no evidence" of an oncoming downturn or recession.
"There's no data, no evidence, no numbers, and there's no consumer propensity to slow down yet," he said.
Because of the $4.5 trillion pumped into the economy and the productivity boost that firms received by adopting direct-to-consumer strategies, predicting a recession will be tough.According to celebrity investor Kevin O'Leary, the US economy is considerably stronger than people believe, and there is "no evidence" of an oncoming downturn or recession."I'm not saying we won't get one," he said on CNBC's "Squawk Box Asia" on Thursday. "But everyone who says it's coming around the corner next week is just wrong."
"There's no data, no evidence, no numbers, and there's no consumer propensity to slow down yet," he said.
According to the chairman of O'Shares ETFs, he has investments in a wide range of industries, including commercial kitchens, wireless charging, gym equipment, and greeting cards. He also says he hasn't seen "any evidence" of a downturn.
"Every week, I see their tear pages. We haven't seen any signs of a slowdown yet "he said, referring to a document that summarizes a company's critical statistics. "I believe I will be among the first to view it. In that way, I'm like the canary in the coal mine."
He stated that consumption is now performing well.
Despite high consumer spending, the US economy shrank by 1.5 percent in the first quarter of this year due to weakness in business and private investment.
It's a tough decision.
According to O'Leary, there are two reasons why it's difficult to anticipate a recession.
The first is that in the last few years, $4.5 trillion was injected into the US economy "from a helicopter, into the hands of consumers and businesses across the country."
He claims that the amount of money put into the system is unparalleled.
"I deal with figures every week," he added, "of what consumers are buying with the money they have, because they've been given so much of it in the last three years, and I'm not in the camp that believes there's been a terrible recession."
Second, technological advancements have increased production.
Every area of the economy now uses the direct-to-consumer model, which offers larger gross margins and more customer data for businesses. According to O'Leary, it is significantly more efficient and productive.
"Those who are truly predicting a major recession may be wrong, and they may miss out on gains as the market slowly recovers," he warned.
a gentle landing
"In terms of my investment philosophy, I'm erring on the side of a soft landing," the "Shark Tank" investor remarked.
Everyone believes the Federal Reserve is out of control, but he believes Fed Chair Jerome Powell is doing a decent job of balancing inflation and employment.
Even if there are signals of a slowdown or recession, given the huge declines in many indexes, that risk looks to have already been baked into share prices, according to O'Leary.
"Everyone who tells me it's the end of the free world as we know it isn't looking at the evidence," he said, adding that some of the private businesses in which he's invested have had "amazing quarters."
He believes the economy will slow at some time, but he hasn't seen it yet.
"Numbers, not talking heads, are the ones I trust. All day, I hear talking heads telling me what they think will happen. I examine the figures. Numbers aren't deceiving. Cash flow isn't deceiving. That's what I'm interested in "he stated
"Talking heads create a lot of noise. Cash is cash, after all "He went on to say.
Not everyone is in agreement.
Former Fed Governor Robert Heller claimed the United States is "quite near to a recession," citing the first-quarter decline and signs of no growth in the second quarter. Two consecutive quarters of reductions are considered a recession.
"We're dangerously close to that because the second quarter is expected to be flat. "Even the tiniest negative influence will push us into a technical recession," he said on CNBC's "Capital Connection" program "this coming Thursday
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