
Stock Market Crash Coming? BCA Strategist Warns of 60% Recession, S&P Target 4,500
Despite a temporary tariff pause, economist Peter Berezin from BCA Research is maintaining a bearish outlook on the U.S. economy and stock market. While many Wall Street strategists are lowering their recession forecasts, Berezin warns of ongoing economic weakness, trade tensions, and a possible stock market crash.
Berezin Predicts S&P 500 Could Fall to 4,500
Berezin now sees a 60% chance of recession in 2025 — slightly lower than his previous 75% forecast — but still believes a slowdown is coming. He told Business Insider that in his base-case scenario, the S&P 500 could plunge to 4,500, representing a nearly 25% drop from current levels.
“It wouldn’t take much to trigger this decline,” Berezin said, noting the market is already overvalued with elevated price-to-earnings ratios.
Currently, the S&P 500 trades at about 23x earnings, while Berezin expects a correction toward 18x earnings, based on expected EPS of $250.
Economic Red Flags: Labor Market and Consumer Stress
Berezin emphasized that warning signs were visible even before the tariff conflicts. He points to:
- Falling job openings since 2022, weakening the labor market
- Rising credit card delinquencies, now at 3.05% — the highest since 2011
- Student loan repayments resuming, hurting credit scores
- Housing market slowdown, with housing starts down 9.8% in May
Economists like Sam Tombs of Pantheon Macroeconomics also highlight slowing hiring and declining small business confidence.
Trade Tensions Still a Major Threat
Even with Trump’s 90-day pause on tariffs, Berezin sees trade uncertainty as a continuing danger. The current effective tariff rate is around 15%, which he believes is still too high and damaging to growth.
“A tariff rate above 10% is punitive for the economy,” Berezin warned.
He also doubts Trump will lower tariffs significantly unless market pressure forces his hand. In fact, Berezin fears tariffs could increase, especially on sectors like pharmaceuticals, semiconductors, and lumber.
No Soft Landing Without Market Intervention
Berezin doesn’t believe the economy will avoid a hard landing without serious changes. While some expect Trump’s proposed “Big Beautiful Bill” — a potential tax cut package — to provide relief, unfunded tax cuts could backfire by increasing bond yields and the national deficit.
According to the Congressional Budget Office (CBO):
- GDP might grow by 0.5% over 10 years due to the bill.
- But the 10-year Treasury yield would rise by 14 basis points.
- The deficit would grow by $2.8 trillion.
Market Decline Could Force Policy Shift
Berezin believes Trump paused tariffs after watching the S&P 500 dip below 5,000 and 10-year Treasury yields rise above 4.5%. He predicts any future relief will be driven by market conditions, not proactive policy changes.
“We might see more tariff relief,” Berezin said, “but only if markets force that outcome.”