Investors and economists are expressing worries about a potential recession looming this year, with some prominent individuals warning that a downturn could begin as soon as July. Economic forecasters are raising alarms about several indicators that point towards a potential economic downturn.

Recently, Goldman Sachs increased the likelihood of a recession within the next year from 15% to 20%. A survey conducted by Bank of America in March revealed that 55% of fund managers identified a global recession sparked by a trade war as the most significant risk for the market. Additionally, consumer sentiment regarding an upcoming recession reached a nine-month high, based on the latest Consumer Confidence Survey from the Conference Board.

Economist David Rosenberg, a notable market bear, believes that the economy could weaken in the upcoming months. He emphasized that despite low unemployment rates, the changing economic conditions could lead to a recession as early as July, contrary to popular belief.

One of the key warnings highlighted by Rosenberg and other economists is the deterioration of household finances. US households are struggling to keep up with inflation rates, which may significantly impact the economy as consumer spending accounts for a large portion of GDP. The latest New York Fed Survey of Consumer Expectations revealed that 63% of households lack adequate cash reserves to cover a sudden $2,000 expense - the lowest percentage since 2015 considering today's higher cost of living. Additionally, the survey indicated that 34% of Americans anticipate having to come up with $2,000 within the next month.

Household debt is also a growing concern, with total debt reaching a record $18 trillion as reported by New York Fed data, showcasing a $93 billion increase over the fourth quarter.