4/30/25 Notes From Nagle

By Peter Nagle

Greetings fellow-Abiquiuers and those who are far flung. I think the big topic this month is: Are we going into a Tariff-enduced recession?  Some analysts think we’re already in one. Typically we don’t know if we’re officially in a recession until 1-2 quarters later. That’s because economic indicators are backward looking. But we got a stat this morning that says our economy is not growing, in fact it’s contracting for the first time in years. Not a good sign. 
 
Here’s the recession timeline according to Dylan Jovine, a good analyst I follow:
 

• April 2: Tariffs announced, containership departures from China to U.S. slowing
• Early-to-mid May: Containerships to U.S. ports come to a stop
• Mid-to-late May: Trucking demand comes to a halt, leading to empty shelves and lower sales for companies
• Late May to early June: Layoffs in trucking and retail industries
• Summer 2025: recession

 
It’s probably the worst case scenario but it’s worth noting. 
 
We’re a consumer led economy. If consumers reduce spending because they’re concerned about their jobs, that alone could kick us into recession. If consumers go into stores and see empty shelves… I don’t think we’ve ever actually seen how Americans would react to that. It probably would result in hoarding, which would empty shelves even further. Once we’ve exhausted that cycle who knows how people would react? 
 
The markets? Typically, depending on the severity of the recession, stocks decline anywhere from 25 - 50%. We’ve already seen a 20% decline in April, half of which has been recouped. But if we’re heading into a recession, that decline is not over. 
 
As I said last month, it’s time to be very conservative in your investments in my opinion. I’d be looking at fixed income investments like bonds and deferred annuities to smooth out the ride. Usually in recessions interest rates drop significantly and that’s good for investments like that.
 
I provide financial advice to individuals in our Abiquiu community at no charge as a way of giving back. If you have questions in that area feel free to contact me. I’ll do the best I can to help you sort through the issues. 
 
Peter J Nagle
Thoughtful Income Advisory
Abiquiu, NM
505-423-5378 (mobile)
[email protected]