A month after internal issues sent the stock price of Discover (DFS) plunging, its long-time CEO resigned out of the blue. 

“It’s pretty shocking when something like this happens,” explains Josh Steiner in this clip from The Call @ Hedgeye. “Naturally, you tend to think bad things and assume the worst. I don’t think that’s entirely unreasonable given the swift nature of the departure.” 

Even if Discover doesn’t have additional negative news to report, there’s plenty of it to go around from a macro perspective. 

“You’ve got large cohorts of earners who fully exhausted their excess savings built up from the pandemic period and continue to struggle from a cost-of-living standpoint,” Steiner says, “Anybody who bought a home or car or racked up debt the past 12-18 months has done so at high cost.” 

“On the labor market front, we’re seeing increasing signs of stress,” Steiner adds. “Overtime hours and temp staffing are down, ZipRecruiter had a really dire 2Q earnings report. The recruitment industry has fallen out of bed completely. We’re starting to see some data sets suggesting a white-collar recession on the labor front is starting to take hold. On top of all this, student loan payments return in 5-6 weeks. Put all these things together and it paints a pretty challenging backdrop.” 

Watch the full clip above. 

Is A White-Collar Recession Starting To Look More Likely? - Call Banner