Economic Overview - The US economy appears stable on the surface, with GDP growth exceeding 3% for the last two quarters and an unemployment rate of 4.4%, which is low by historical standards [2][4] - However, there are significant underlying risks that could threaten this stability, particularly in key sectors such as homebuilding and restaurants, which are showing signs of weakness [3][5] Labor Market Dynamics - The current labor market conditions are gradually cooling, but the potential for a nonlinear shift in unemployment exists, which could lead to a rapid increase in joblessness rather than a gradual rise [4] - Historical patterns suggest that the consensus often fails to recognize the transition from stable to unstable labor market conditions until it is too late [4] Sector-Specific Concerns - Major employers in struggling industries provide early warning signs about the overall economic trajectory, indicating that a recession could be on the horizon [3][5] - Treasury Secretary Scott Bessent has acknowledged that certain sectors are already experiencing serious downturns, reinforcing the need for a closer examination of economic indicators [5]