• Ed Yardeni says baby boomers will save the US economy by spending down their $75 trillion nest egg.

• This spending could help prevent a recession at a time when savings from the pandemic are depleted.

• "What these seniors don't pass on to their heirs, they'll be spending in their golden years," Yardeni said.

The market veteran Ed Yardeni says fears of an imminent recession are overblown because millions of baby boomers will soon retire and begin spending down their massive $75 trillion nest egg.

Baby boomers' ability to prop up the US economy comes at a time when economists worry about the depletion of excess consumer savings, which peaked at about $3 trillion during the COVID-19 pandemic, and as millennials prepare for the restart of their student-loan payments.

"There's a $75 trillion-wide hole in the theory that consumers' running out of pandemic savings will sink the economy; that's the size of baby boomers' collective nest egg," Yardeni said in a Monday note. "What these seniors don't pass on to their heirs, they'll be spending in their Golden Years."

Yardeni estimated that baby boomers — which includes around 58 million people over 65 — had $20 trillion in stocks, $18 trillion in real estate, $15 trillion in pensions, $8 trillion in noncorporate-business stakes, and $9 trillion in cash.

And as these baby boomers approach retirement and their early 70s, they'll be subject to required minimum distributions from their 401(k) and IRA accounts, which should nudge them to spend. Baby boomers are the generation aged from 59 to 77 years old and are set to become seniors by 2029.

Baby boomers' massive pile of wealth, combined with the $40 trillion and $8 trillion of wealth held by Generation X and millennials, respectively, should help power consumer spending going forward, even amid headwinds of student-loan payments and depleted savings since the pandemic.