A market indicator involving the wealthy is showing that a recession could be brewing, according to a new report.
CNBC reported Wednesday that the rich in the United States aren't spending like they normally do, with expensive homes remaining on the market and supercars costing at least $1 million selling at shrinking rates.
A brief look at the numbers:
- Home sales of at least $1.5 million dropped 5% in the second quarter.
- High-end retailers Barney's and Nordstrom are struggling, with the former even filing for bankruptcy.
- Supercars at a recent auction sold poorly, while cars costing less than $75,000 sold better.
- Art auctions at Sotheby's (down 10%) and Christie's (down 22%) decreased over the last year.
"If high-income consumers pull back any further on their spending, it will be a significant threat to the economic expansion," Moody's Analytics chief economist Mark Zandi told CNBC.
The stock market has been fragile in recent weeks, which some experts think might be an indicator of things to come. One analyst is even sticking to his prediction of a monster sell-off on Wall Street this week.
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