Recession & Market-Peak Dashboard

Three lenses on bear-market risk: recession risk (is the economy turning?), market-peak froth (is the market priced like a top?), and price trend (is the market actually rolling over?). Plus 55 years of base rates for the current regime.

Updated monthly · Readings as of early July 2026 · Generated 05 Sep 2026, 03:16

RECESSION
FROTH
TREND
OVERALL READ
Economy calm · Froth moderate · Uptrend intact · stay invested, stay disciplined
No recession signal, trend healthy, sentiment not stretched.

Lens 1 · Recession risk: BENIGN. Yield curve, Sahm Rule, credit spreads, ISM and the LEI drive this call. Red on any core signal escalates the whole read.

Lens 2 · Market-peak froth: 36% of signals triggered. Built from public data. High froth alone rarely ends a bull.

Lens 3 · Price trend: BENIGN. Uptrend intact: 50-day above 150-day, both rising. This is the act trigger: a trend break alongside high froth is the historic sell signal.

WHAT HAPPENED NEXT · 55-YEAR BASE RATES
Every month since 1971 classified into four regimes using only real-time data. Highlighted row = the regime you are in now.
['', '', '', '', '', '', '']ECONTRENDREGIME19801990200020102020
NBER recessionStrips: per-month econ, trend, and combined regime status
RegimeMonths3m med6m med12m med12m positive12m worst
Econ calm · Trend up ← now 263+2.7%+5.2%+11.1% 79%-22.6%
Econ calm · Trend down 78+3.8%+5.3%+12.0% 84%-17.3%
Econ stressed · Trend up 206+2.4%+4.9%+10.1% 76%-39.5%
Econ stressed · Trend down 120+1.7%+2.6%+12.3% 65%-44.8%

Within calm-economy uptrends, months with the froth proxy ON saw a median 12m forward return of +10.9% (n=202) vs +13.9% (n=52) with it OFF.

Regime rules use fewer signals than the live lenses so history is honest (see glossary). Forward windows overlap month to month; these are descriptive base rates, not statistical tests. Price returns only, no dividends.

LENS 1 · RECESSION-RISK DASHBOARD
Leading & coincident indicators of an economic downturn.
Benign / no signal Watch / mixed Elevated risk
Yield Curve (10yr − 3mo)
Best-documented predictor: inverted before every U.S. recession since the 1960s, 12 to 18mo lead.
+0.88%
NORMALIZED
Sahm Rule (jobs momentum)
Fires when 3-mo avg unemployment rises 0.5pt off its 12-mo low. Caught every recession start since 1970.
−0.07
TRIGGER 0.50
High-Yield Credit Spreads (HY OAS)
Cleanest market stress gauge; blows out into downturns. So tight now it borders on complacency.
~2.6%
HISTORICALLY TIGHT
ISM Manufacturing PMI
Below 50 = contraction. Expansion. Latest: August 2026.
54.6
EXPANSION
Conference Board LEI
Level 99.5 (July 2026); 6-mo change -0.3%.
99.5
IMPROVING
Labor Market (unemployment / payrolls)
Solid headline but internals softening: long-term unemployed +524k YoY.
4.1%
COOLING BENEATH
Valuation (Shiller CAPE)
Not a timing tool: predicts weak long-run returns. Near dot-com territory.
~42
STRETCHED
LENS 2 · MARKET-PEAK FROTH · PUBLIC-DATA GAUGES
A signal is triggered when it shows the euphoria or complacency typical of market tops.
36% of peak signals triggered

In line with levels typically seen at prior market peaks. See the base-rate table above for what froth has and has not meant historically. Watch Lens 3 for the trigger.

Consumer Confidence > 110
Conference Board confidence index
89.4
Not yet
Retail Euphoria
AAII bull minus bear sentiment survey
39.7% bulls
Not yet
Manager Bullishness
NAAIM active-manager equity exposure
79.7
Not yet
Growth-Expectation Froth
S&P 500 forward P/E percentile
~21× · 74th pct
Not yet
Deal & IPO Froth
IPO run-rate vs prior 3 years (M&A not included)
263 YTD · ~387/yr pace
Triggered
Rule of 20 (P/E + CPI)
Trailing P/E + YoY inflation
33.4 · well > 20
Triggered
Vol Complacency
VIX spot below 14
14.3
Not yet
Value vs Growth (6m)
Value vs growth leadership (RPV vs RPG)
Growth +18% 6m
Triggered
Inverted Yield Curve
10yr minus 3mo Treasury spread (FRED)
+0.88%
Not yet
Credit Complacency
Chicago Fed NFCI financial conditions
−0.56 (loose)
Triggered
Tightening Credit (SLOOS)
Fed Senior Loan Officer Survey
net easing
Not yet
Froth % across runs 2026-08-20 → 2026-09-04
LENS 3 · PRICE TREND
50-day vs 150-day simple moving average, daily candles.
Benign SPX 7,743 · 50d 7,593 · 150d 7,237

Uptrend intact: 50-day above 150-day, both rising.

S&P 500 (last 250 sessions)50-day SMA150-day SMA
DATA PROVENANCE & FRESHNESS
Yield curve 10y-3mFRED T10Y3M auto 2026-09-03
Sahm ruleFRED SAHMREALTIME auto 2026-08-01
HY OASFRED BAMLH0A0HYM2 auto 2026-09-03
NFCIFRED NFCI auto 2026-08-28
VIXFRED VIXCLS auto 2026-09-03
SLOOS net tighteningFRED DRTSCILM auto 2026-07-01
UnemploymentFRED UNRATE auto 2026-08-01
CPI YoYFRED CPIAUCSL auto 2026-07-01STALE 66d
S&P 500 dailyyfinance/Stooq + csv cache auto 2026-09-04
RPV/RPG 6myfinance RPV / RPG auto 2026-09-05
ISM Manufacturing PMIgnews->prnewswire / dbnomics auto 2026-08-01
Conference Board LEIconference-board.org auto 2026-07-18STALE 49d
Consumer Confidenceconference-board.org auto 2026-08-26
Forward P/E (computed)spglobal xlsx / WSJ P/E page auto 2026-09-03
Deal & IPO frothstockanalysis / nasdaq api auto 2026-09-05
Shiller CAPEmultpl.com/shiller-pe auto 2026-09-05
Trailing P/Emultpl.com/s-p-500-pe-ratio auto 2026-09-05
AAII sentimentaaii.com sentiment.xls auto 2026-09-03
NAAIM exposurenaaim.org workbook (cached) cache 2026-07-29STALE 38d
WHAT EACH SIGNAL MEANS
Lens 1: recession risk
Yield Curve (10yr − 3mo)
Gap between long and short Treasury yields. Inversion has preceded every U.S. recession since the 1960s with a 12 to 18 month lead.
Sahm Rule
Fires when the 3-month average unemployment rate rises 0.5pt above its 12-month low. Caught every recession start since 1970 with few false alarms.
High-Yield Credit Spreads (HY OAS)
Extra yield demanded to hold junk bonds. Cleanest market stress gauge; blows out into downturns. Extremely tight spreads signal complacency.
ISM Manufacturing PMI
Purchasing managers survey. Above 50 = expansion. Sustained sub-47 readings accompany recessions.
Conference Board LEI
Composite built to lead the cycle by about 7 months. Scraped from CB's own release text. Status uses the plain 6-month % change as CB quotes it: green above 0, watch to -2%, red below -2%.
Labor Market
Unemployment and job growth lag the cycle but confirm a downturn once underway. Watch the internals, not just the headline.
Shiller CAPE
Price over 10-year inflation-adjusted average earnings. Predicts weak long-run returns but does not time tops; markets stay expensive for years.
Lens 2: market-peak froth
Consumer Confidence > 110
Conference Board index. Readings above 110 reflect household optimism often seen near tops.
Retail Euphoria (AAII)
Bullish minus bearish individual investors, weekly. Extreme bullishness is a contrarian warning: when everyone is optimistic the buyers are already in.
Manager Bullishness (NAAIM)
Active managers' actual equity exposure, 0 to 100+. Near 100 means all-in with no cash left to add.
Growth-Expectation Froth (Forward P/E)
Computed as SPX divided by the next-12-month operating EPS estimate from S&P Global's public workbook. Percentile is vs an approximate 1999-2025 forward P/E history embedded in the script.
Deal & IPO Froth
Automated from the US IPO count run-rate (annualized YTD pace vs the prior three full years, via stockanalysis.com). M&A volume is not included; set deal_ipo_override in the script to force the signal on M&A judgment.
Rule of 20 (P/E + CPI)
Trailing P/E plus inflation. Above 20 has historically signalled overvaluation.
Vol Complacency (VIX)
Spot VIX below 14 means options markets are pricing very little risk: hedges are cheap and complacency is high.
Value vs Growth (6-month)
Growth leading value signals late-cycle speculation. Value leading eases this signal.
Inverted Yield Curve
Included here too: inversion is a classic macro signpost on the way to a peak.
Credit Complacency (NFCI)
Chicago Fed index. Negative = looser-than-average conditions = the complacency that often precedes turns.
Tightening Credit (SLOOS)
Fed loan-officer survey. Rising net tightening means credit is getting harder to get.
Lens 3: price trend
50-day vs 150-day SMA (daily)
A genuine bear signal needs the 50-day to cross below the 150-day AND both to flatten or turn down. Until then the uptrend is intact.
Regime engine and base rates
Regime classification
Every month since 1971 is classified with only real-time data: econ = green unless Sahm ≥ 0.33 or NFCI > 0 or curve inverted (red if Sahm ≥ 0.5 or NFCI > 0.5); trend = 50d vs 150d SMA. This deliberately uses fewer signals than the live lenses so the base rates are honest.
Base rates
Forward S&P returns from every month in each regime. Observations overlap month to month, so treat these as descriptive base rates, not statistical tests.
Froth proxy
For history, froth = NFCI below −0.40 with a positive yield curve. This is a proxy: sentiment surveys do not extend cleanly to 1971.