The forecast for this quarter is around 3% GDP growth (annualized) - how does that put us "in a recession" right now? Doesn't that mean the recession is over?
It's a common misconception because of crappy media that that alone is how to determine a recession. There was a good Planer Money on it a month or so ago. Either way the goal right now IS a recession. That's why interest rates are up but despite this we keep buying shit we don't need.
It's one of the textbook definitions of a recession from a first year college economics course. That is, it's a standard definition of a recession.
For example, to quote the IMF:
"Most commentators and analysts use, as a practical definition of recession, two consecutive quarters of decline in a country’s real (inflation adjusted) gross domestic product (GDP)—the value of all goods and services a country produces (see “Back to Basics,” F&D, December 2008). Although this definition is a useful rule of thumb, it has drawbacks." (https://www.imf.org/external/pubs/ft/fandd/2009/03/pdf/basic...)
Because the people who don't like this textbook definition being used when it's inconvenient, haven't proposed a better definition. What definition would you use to describe a recession?
By the classic definition and trends in our industries like layoffs, I think we all know it's already here regardless of the election related word games.
There are always layoffs. Layoffs don't make a recession. Do you not think people get laid off and businesses are failing during good times? Of course it happens.
Darn! Other than magical beliefs in lottery winnings, how else would one acquire the lion's share of the world's liquid capital? I can only think of the brutal triumphalism of differential equation-like scenarios enabling a power-law, winner-takes-almost-all distribution of wealth. I'm sure these honest parties would absolutely never gamify or encourage government corruption to reduce taxes and regulations on themselves to accelerate their dominance. [Bezos likeness here counting money with a cigar and looking like he's having far too good of a time.]
buy a single share of Gamestop on Computershare. you will be able to sell it for over $100 million after MOASS. you do not want to be holding IOUs when banks and brokers get liquidated.
Is it time to start using the scary “d word” yet? … depression
It’s been half a year of ostrich like behaviour and borderline paradoxical (but understandable though certain lenses) stock market responses while economies around the world are sliding downhill like they are all practicing for the Winter Olympics.
It’s sort of hard to look at the situation and think “this won’t end up with economic depression” … it’s looming up on the horizon as we get deeper into the reality of a global recession (can we call it a global one yet?) maybe not in the USA, but perhaps the UK, or somewhere else that feeling the current situation more acutely.
I've been thinking about how these economic conditions, while they meet every criteria of a severe recession, are vastly different for the average person than any I can think of in modern history.
In a typical recession GDP is down, unemployment is up, wages are being driven down, and companies have stockpiles of unsold inventory because nobody has money to buy things. In this recession GDP is down, we're at full employment, wages are being driven up, companies have empty inventory due to supply chain issues, and consumers are standing around holding cash waiting for someone to offer products for sale.
I think GDP is down because a lot of workers retired or otherwise left the workforce at once so companies don't have enough people to get work done. Supply chain issues mean manufacturers and retailers don't have products to sell, which also impacts GDP. Cost of living is certainly up which impacts the average person, but honestly that wouldn't be such a problem if companies were setting wages in response to market conditions as opposed to stubbornly keeping them low as if a bunch of people who want to work for minimum wage will magically appear.
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[ 2.0 ms ] story [ 580 ms ] threadHas bloomberg claimed to know the future 1 year in advance with 100% probability before?
Bloomberg is 100% right.
For example, to quote the IMF:
"Most commentators and analysts use, as a practical definition of recession, two consecutive quarters of decline in a country’s real (inflation adjusted) gross domestic product (GDP)—the value of all goods and services a country produces (see “Back to Basics,” F&D, December 2008). Although this definition is a useful rule of thumb, it has drawbacks." (https://www.imf.org/external/pubs/ft/fandd/2009/03/pdf/basic...)
David Sacks points this issue out rather well.
It’s been half a year of ostrich like behaviour and borderline paradoxical (but understandable though certain lenses) stock market responses while economies around the world are sliding downhill like they are all practicing for the Winter Olympics.
It’s sort of hard to look at the situation and think “this won’t end up with economic depression” … it’s looming up on the horizon as we get deeper into the reality of a global recession (can we call it a global one yet?) maybe not in the USA, but perhaps the UK, or somewhere else that feeling the current situation more acutely.
In a typical recession GDP is down, unemployment is up, wages are being driven down, and companies have stockpiles of unsold inventory because nobody has money to buy things. In this recession GDP is down, we're at full employment, wages are being driven up, companies have empty inventory due to supply chain issues, and consumers are standing around holding cash waiting for someone to offer products for sale.
I think GDP is down because a lot of workers retired or otherwise left the workforce at once so companies don't have enough people to get work done. Supply chain issues mean manufacturers and retailers don't have products to sell, which also impacts GDP. Cost of living is certainly up which impacts the average person, but honestly that wouldn't be such a problem if companies were setting wages in response to market conditions as opposed to stubbornly keeping them low as if a bunch of people who want to work for minimum wage will magically appear.