Lakshman Achuthan Says US Faces Deeper Recession Than In 2007

The U.S. faces a "brutal" recession that could surpass the 2007-2009 crisis in scale and scope, economic forecaster Lakshman Achuthan said on CNBC's "Trading Nation."

What Happened

While a recession isn't official yet, the coronavirus pandemic has so far forced 22 million people to file for jobless claims, Achuthan said. In comparison, jobless claims during the Great Recession totaled just 8.7 million over the entirety of the recession.

Economic headwinds are spreading "like wildfire" from industry to industry and from region to region, he said. 

Why It's Important

Even if the depth of the recession will be severe, the duration could prove to be short-lived, he said. In fact, the recession could end up being "among the shortest on record," Achuthan said. This part of the outlook is certainly "unexpected" but can be justified, he said. 

At the very least, he said a partial reopening of the U.S. economy would "lift activity off of the extreme lows."

"And that is where a good leading index of cycles of the economy becomes critical." 

What's Next

Regardless of how long a recession lasts, expectations for a return to normalcy aren't coming "anytime soon," Achuthan said. 

All investors can do for the time being is look at where the leading indexes go, he said. 

"That's the critical point." 

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