Topline
There may be an answer by next week on whether or not the limping U.S. economy will enter a recession, according to one historically reliable indicator: a Philadelphia World Series title.
A Phillies World Series win could throw cold water on the economy.
Key Facts
The Philadelphia Phillies will face off against the Houston Astros in the MLB’s championship round beginning Friday.
Philadelphia’s last four World Series wins, the first two won by the Athletics when they played in the city and the latter won by the Phillies, coincided with recessions: the Athletics’ 1929 and 1930 titles came in the early stages of the Great Depression, while the Phillies’ 1980 win came amid the energy-crisis fueled downturn and 2008 title during the worst of the Great Recession.
Considering major stock indexes are set for their worst performances in over a decade and the U.S. economy has contracted for consecutive quarters, a 2022 Phillies title may add to that dubious distinction.
Luckily for bulls, oddsmakers consider the Astros the heavy favorite, with FanDuel Sportsbook giving the Phillies 38% implied odds of winning the World Series – eerily similar to the 35% chance Goldman Sachs economists gave the U.S. economy of plunging into a recession in a weekend note (Goldman didn’t cite baseball in their rationale, but rather more mundane economic analysis).
Key Background
It may seem silly resting your recession expectation laurels on the World Series’ outcome, but it’s fitting considering baseball is a sport steeped in a history of superstition. The Phillies snuck into the playoffs by securing the National League’s last wildcard spot, winning just 87 games in the regular season, compared to the Astros’ 106 wins. Despite their records, Philadelphia toppling Houston would be far from David slaying Goliath:The Phillies’ $172 million payroll is the MLB’s second-highest, more than 10% higher than the Astros’ $155 million payroll. Philadelphia’s star player, outfielder Bryce Harper, is in the midst of a 13-year, $330 million contract, and his $32.5 million in earnings on and off the field make him the ninth highest-paid player in the sport, according to our estimates.
Big Number
20.1%. That’s how much the S&P 500 is down year-to-date, on pace for its worst year since 2008, the year of the last Phillies’ World Series victory.
Further Reading
No, a Phillies World Series win won’t lead to a recession (we think) (Philadelphia Inquirer)
Is the U.S. in a Recession? What Key Economic Indicators Say (Federal Reserve of St. Louis)
