Leave it to the gizzard squeezers at Goldman Sachs to freak everyone out.
They predict the odds of an imminent recession, courtesy of spiking oil prices, are now 30%.
Why 30%? Why not 29%? Why not 46%? Come on!
What’s The Big Skinny? Manufactured anxiety always shows up before massive rallies, not sell-offs. I just sat down with my friend Adam Johnson – portfolio manager of the Bullseye American Ingenuity Fund – to walk through five quarters of data that makes Goldman’s call look downright silly. He also shares not one, but seven stocks to buy today. [Watch our full conversation here.]
.1 Headline.
“Goldman Sachs Lifts U.S. Recession Probability to 30%”
When Goldman starts slapping 30% recession probabilities on the tape, you’re not early to the apocalypse. You’re late to the bottom.
Shame on the armchair portfolio managers at The Wall Street Journal for even giving Goldman’s big prediction any visibility.
Adam’s been around long enough to know the pattern, too.
During our conversation, he walked me through March 9, 2009 – the literal day the S&P bottomed at 666 – when a 25-year veteran trader called him and said, “Adam, this thing could get really bad.” That was the call. That was the bottom.
Fast forward to today and Adam told me he’s fielded more panicked client calls in the past few weeks than at any other point in his career, including the tariff low.
Mind you that’s not the only contrarian indicator screaming buy.
The growing list includes…
The VIX recently spiking to 35.
The put-call ratio hitting 1.3, proving traders are paying up for protection, not positioning for upside.
Oil traders calling for $200 crude. This is the sam crowd that whispered “$200” back in 2008 right before crude prices collapsed.
Against such a “scary” backdrop, let’s breathe and consider the hard data that actually matters…
.1 Chart.
Earnings reality. S&P 500 companies just posted five consecutive quarters of double-digit earnings growth. That’s the best run since the post-COVID rip of 2022.
Revenue reality. Top-line growth is humming at 9% and estimates call for a sixth straight quarter of expansion.
Margin reality. Profit margins are sitting at a record 13.4% – the highest in history. That’s the buffer that eats inflation for breakfast.
You get the point. The chart above is not one of a dying economy, but an accelerating one.
In other words, Goldman is calling recession on the strongest corporate engine ever built.
Or as Adam put it on the show – “amidst everything” from inflation angst to Middle East missiles to Capitol Hill rancor – corporate America keeps printing money.
As we all know, stock prices always follow earnings. So we should be buying not crying about the imminent recession calls.
Thankfully, Adam served up seven compelling stocks to consider in the current market.
.1 Investment Insight.
7 Stocks to Buy Today. All Alpha. Zero Fluff
I’ve been banging the table on the “buy when they’re scared” playbook since the tariff low. But it’s nice to have someone else echo those strong sentiments.
Adam didn’t stop at one high-conviction pick, though. He opened the kimono on seven names from his 43-stock American Ingenuity portfolio, including household giants trading cheaper than the S&P, a software behemoth down 70% from its high, and a crypto trifecta he calls the “three C’s.”
I’ll give you two now. The rest? You’ve got to hit play.
The household name hiding in plain sight: Microsoft $MSFT ( ▼ 3.46% ). It’s trading at the cheapest forward P/E multiple in a decade, while owning the guts of the cloud and a big position in OpenAI. That valuation, on that growth rate, with that moat – it’s a gift.
The name nobody’s heard of: Joby Aviation $JOBY ( ▼ 4.42% ). Adam calls it the “future Uber of the skies.” Electric vertical takeoff and landing drones – six rotors, five passengers, the sound of rustling leaves. Midtown to JFK in 10 minutes for the price of an Uber. Backed by Toyota, JetBlue, Uber, and Intel. The White House and the Department of Transportation just accelerated the rollout across 12 states.
Five more names are on the podcast, including:
A database giant that fell 70% from its high and now trades at a “teens” multiple with 30–35% growth.
A humanoid robot play hiding inside a car company. The math on it alone changed Adam’s mind after he swore off an entire sector.
The first ground-up online-only bank, whose CEO is the 13th largest shareholder and buys every dip.
And yes, a company that corners the three C’s of crypto.
The Big Skinny: When the panic peddlers tell you the sky is falling, pull up the earnings chart. Then ask yourself who’s more likely to be right – Goldman’s recession oracles or 500 CEOs signing off on quarterly results? Five straight quarters of double-digit earnings growth and record 13.4% profit margins don’t break, they compound. Treat Goldman’s 30% recession call as the dinner bell, not the fire alarm.
.Before You Run….
Full episode: All 7+ stock picks, plus our “Fund, Marry, Kill” Mag 7 game – on this week’s episode of The Big Skinny podcast here.
The Big Skinny Live TONIGHT @5pm ET! Join us here and I’ll break down the picks Adam revealed and the ones I held back.
Follow Adam’s research at BullysEyeBrief.com and his insights on Twitter.
For entertainment/educational purposes only. Not financial, legal, or tax advice; not a recommendation or solicitation. Terms & Conditions: TheBigSkinny.com.
