Michael Cembalest outlines three possible macroeconomic scenarios for the remainder of 2024—ranging from stable growth to recession and stagflation—and assesses the likelihood and market impact of each. The report encourages investors to prepare for divergent outcomes rather than rely on a single forecast, with an emphasis on balance, flexibility, and disciplined analysis.
The Good, the Bad, and the Ugly
J.P. Morgan Asset Management
Michael Cembalest
Research
11 Pages
Key Takeaways
Three-scenario roadmap: The “Good” case features soft landing and disinflation, the “Bad” includes a mild recession, and the “Ugly” reflects stagflation risk with sticky inflation and weak growth
Data-driven divergence: Market direction will hinge on inflation trends, earnings revisions, labor softness, and Fed decisions, with conflicting signals across indicators
Portfolio posture matters: Cembalest recommends diversified exposure, quality assets, and risk discipline to manage through uncertain and potentially volatile conditions
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