A lead portfolio manager at a $205 billion asset manager explains why there’s no recession ahead for the US economy — and shares 8 mid-sized stocks set to beat the market going forward

• Analysts have been divided on recession calls, but TCW’s Diane Jaffee expects a soft landing.
• Jaffee expects mid-caps to outperform their larger counterparts going forward.
• She shared eight mid-sized stocks with fundamentals strong enough to beat the market.

Wall Street started 2023 wary of a looming recession. And while there are some investors who still believe the market could crater as much as 25% if the Federal Reserve continues its aggressive rate hiking cycle, there are others, like Morgan Stanley economist Seth Carpenter, who believe that the US central bank could actually pull off a soft landing.

“We are seeing job openings come down, but we’re not seeing a lot of firings,” Carpenter said in a recent interview. “I think that’s reflective of the fact that you can get a slowdown in the economy and easing of pressures without there having to be really an outright contraction or a hard recession.”