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The Recession


Neonmoon
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6 hours ago, tx 3 putt said:


Also, seems to be a lot of high paying jobs

if you can turn a wrench, work safe in shitty conditions, willing to to be on the road, and pass a drug test. There a plenty high paying millwright jobs 

If you are willing to roll out of bed and can show up there are jobs to be had. We have a 50 dollar bounty if they last two whole days.

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9 hours ago, ClubWhatever said:

Did not know that strip clubs had locker rooms that look like ice rink locker rooms.  Now I do. 

When I was 16 I delivered pizza to a stripper locker room and it was one of the premium strip clubs.

 

Shocked Gif GIF

 

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36 minutes ago, Neonmoon said:

Let’s listen to the troll that thinks fiat currency is scam. 

I’m not sure why we have this thread.
 

If there’s a bad recession the Fed will just have to print money with the click of a button and give it to large financial institutions.
 

If the debt markets freeze up they might have to click the button again to print some more money and buy more of the debt of large corporations.

 

If the global financial system seems threatened they can click another button, print more money and give it to foreign banks. 
 

Who said anything about a scam?

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10 hours ago, F250 said:

Covid denier too.

 

 

11 hours ago, Neonmoon said:

Let’s listen to the troll that thinks fiat currency is scam. 

 

12 hours ago, Fudge Nuggets said:

Crypto, obviously. 

All of these.  The tariff war with China is an easy place to begin, along with the Covid induced supply chain issues and the PPP which served very limited purpose beyond injecting lots of cash to a few companies that needed it and a bunch that didn’t.  We didn’t take a penny of it, but have bought several companies that did and almost all of them were just as badly run as you’d expect.

 Government direct stimulus to companies is a terrible idea ; government projects are way better but obviously procurement rules make it a slower process.

 

I think when it’s all said and done QE and other forms of stimulus are going to be found to have been net negatives long term.

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Posted (edited)

Recession by the classic definition (2Q of negative growth) is extremely likely.  Market sentiment tied to that means a bear market is extremely likely.  The other hallmarks of dark economic times?  I don’t think they’re likely.  


There are 5M more job openings than people looking for work.  % of people on unemployment is lower than it’s been in 50 years.  Demographic trends point to a labor shortage in the short, medium, and long term.  So I just don’t see us getting into double digit unemployment, at least for many years, and possibly ever.

The dollar is very strong compared to other currencies.  So while we are seeing dramatic inflation, it’s a worldwide phenomenon.  That tells me it’s not an issue of money supply or access to capital, but an issue wholly related to the supply of goods and services.  Aside from the labor shortage, geopolitical issues are by far the largest cause.  
 

It is difficult to predict the outcome of the Russia-Ukraine conflict.  But I am hopeful it will largely resolve over the course of this year.

Certainly financial stimulus is a contributing factor to what we’re seeing, but I think it’s 3rd or 4th or 5th down the list of primary causes.

If a “soft landing” means avoiding recession, I think that ship has sailed.  I predict a deep but quick recession.  If soft landing means just getting inflation under control without sending unemployment to uncomfortable levels, I am very optimistic they’ll achieve that outcome.

Edited by Snake Diggity
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The timing of all these crashes is just exquisite.   I started college in 1984, crash in 1987, job market sucked when I graduated.   The 1990s were good (thanks a lot, Clinton), had kids in ‘96 and ‘98 and started my good earning years, crash in 2000.  Wiped out half of my retirement savings.  Repeat in 2008.   Now, I was magically close to the number I needed to retire and bam! I’m gonna have to work until I die, unless we get some quality nationalized healthcare.  

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Here’s the other rub. All the people that say big government is evil and can’t be trusted?   Well in 1929 that may have been the case, but I’ve lived through 3 “potential depressions” and come out OK.   I still have a job, and my kids are eating and doing ok, so all the “socialist” stuff you cry about that has been put in place seems to be working ok.  Can we do better?  Sure.  But not by tearing everything down.  

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32 minutes ago, Snake Diggity said:

Recession by the classic definition (2Q of negative growth) is extremely likely.  Market sentiment tied to that means a bear market is extremely likely.  The other hallmarks of dark economic times?  I don’t think they’re likely.  


There are 5M more job openings than people looking for work.  % of people on unemployment is lower than it’s been in 50 years.  Demographic trends point to a labor shortage in the short, medium, and long term.  So I just don’t see us getting into double digit unemployment, at least for many years, and possibly ever.

The dollar is very strong compared to other currencies.  So while we are seeing dramatic inflation, it’s a worldwide phenomenon.  That tells me it’s not an issue of money supply or access to capital, but an issue wholly related to the supply of goods and services.  Aside from the labor shortage, geopolitical issues are by far the largest cause.  
 

It is difficult to predict the outcome of the Russia-Ukraine conflict.  But I am hopeful it will largely resolve over the course of this year.

Certainly financial stimulus is a contributing factor to what we’re seeing, but I think it’s 3rd or 4th or 5th down the list of primary causes.

If a “soft landing” means avoiding recession, I think that ship has sailed.  I predict a deep but quick recession.  If soft landing means just getting inflation under control without sending unemployment to uncomfortable levels, I am very optimistic they’ll achieve that outcome.


7-F2-A41-A9-5-F0-F-4-B46-BC50-14-A076-B7

 

 

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2 minutes ago, Snake Diggity said:

Hahahahah they say 41% of all dollars were created in 2 years…then show that number as calculated with the 2020 dollars as the denominator.  That aside, they changed how they calculate M2: https://fred.stlouisfed.org/series/M2

 

You’re a fucking idiot.

U ok?

New series. Same result. 
 

F73401-F5-68-B8-4-F4-A-8070-631-FF2-CEDC

I may be a fucking idiot but you’re demonstrably wrong. 

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23 minutes ago, Judge Roybeanbag said:

Here’s the other rub. All the people that say big government is evil and can’t be trusted?   Well in 1929 that may have been the case, but I’ve lived through 3 “potential depressions” and come out OK.   I still have a job, and my kids are eating and doing ok, so all the “socialist” stuff you cry about that has been put in place seems to be working ok.  Can we do better?  Sure.  But not by tearing everything down.  

And what did big bad government do after 1929? They created FDIC to insure your money in banks. Why? Because there was a run on banks after 1929. People pulled all their money out of banks. Less money in banks meant less money banks had to lend out for small business loans and home loans. This means less goods and services were created, which means the economy declined. The government created the FDIC to ensure stability of the economy. 
 

You see kids, stability is good. Without stability, there is a greater chance of conflict, which can lead to violence. Violence is bad.
 

 

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It is amazing how fast all of the media and financial pundits have started spouting shock value headlines about a major recession and deep stock market corrections. 

Just keep in mind those pundits are probably trading on the opposite side of whatever they are saying publicly. And the Fed is trying to engineer an elevated inflation environment for the next ten years to inflate away the debt as a percentage of gdp. To do that they have to talk tough to scare everyone, slowing down runaway inflation, but then will have to lighten up once the data shows 4% inflation instead of 7-8%. 

We may have a deep stock market correction and negative gdp at some point, but the next ten years will be a 3-4% inflation environment.  

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27 minutes ago, Dbeasy said:

It is amazing how fast all of the media and financial pundits have started spouting shock value headlines about a major recession and deep stock market corrections. 

Just keep in mind those pundits are probably trading on the opposite side of whatever they are saying publicly. And the Fed is trying to engineer an elevated inflation environment for the next ten years to inflate away the debt as a percentage of gdp. To do that they have to talk tough to scare everyone, slowing down runaway inflation, but then will have to lighten up once the data shows 4% inflation instead of 7-8%. 

We may have a deep stock market correction and negative gdp at some point, but the next ten years will be a 3-4% inflation environment.  

It would be nice if captial would share a little bit of that growth, but we all know that's not going to happen. We have the last 50 years to prove it.

 

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1 hour ago, Judge Roybeanbag said:

The timing of all these crashes is just exquisite.   I started college in 1984, crash in 1987, job market sucked when I graduated.   The 1990s were good (thanks a lot, Clinton), had kids in ‘96 and ‘98 and started my good earning years, crash in 2000.  Wiped out half of my retirement savings.  Repeat in 2008.   Now, I was magically close to the number I needed to retire and bam! I’m gonna have to work until I die, unless we get some quality nationalized healthcare.  

Pretty much my story, too.  The fact that the roots of these catastrophes were by and large Republican desire to deregulate and create volatility they could profit from was one reason I became a Democrat.

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41 minutes ago, Captainant said:

Donald Trump GIF by CBS News

Who knew that constant economic stimulus during fat years (2017-2019) would leave us with little to no options when shit actually did hit the fan?? Don't act surprised, you cheered on the policy that got us here

Wasn't one of Trump's beefs that Obama's growth levels were anemic and he could supercharge the economy?  

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56 minutes ago, Neonmoon said:

And what did big bad government do after 1929? They created FDIC to insure your money in banks. Why? Because there was a run on banks after 1929. People pulled all their money out of banks. Less money in banks meant less money banks had to lend out for small business loans and home loans. This means less goods and services were created, which means the economy declined. The government created the FDIC to ensure stability of the economy. 
 

You see kids, stability is good. Without stability, there is a greater chance of conflict, which can lead to violence. Violence is bad.

Exactly.  You can plan and invest in stable times. 

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8 minutes ago, David Dennison said:

It would be nice if captial would share a little bit of that growth, but we all know that's not going to happen. We have the last 50 years to prove it.

 

Cantillon effect

WTF happened in 1971?

Totally not a scam 

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1 hour ago, Judge Roybeanbag said:

The timing of all these crashes is just exquisite.   I started college in 1984, crash in 1987, job market sucked when I graduated.   The 1990s were good (thanks a lot, Clinton), had kids in ‘96 and ‘98 and started my good earning years, crash in 2000.  Wiped out half of my retirement savings.  Repeat in 2008.   Now, I was magically close to the number I needed to retire and bam! I’m gonna have to work until I die, unless we get some quality nationalized healthcare.  

I feel your pain. I started college in '72 during the start of the Arab Oil embargo. Graduated and the best job I could find to pay for grad school was working on an offshore oil rig. Finally got a decent job, and then stagflation came along. The first mortgage I had was @ 12% (yeah, houses were cheaper..but still). Then came Black Monday in 1987 which wiped out my meager holdings. Then the rest of what you also experienced. Had I not stayed in the market in '08 ( against my better judgement) I would be in a world of shit right now. tl;dr Recessions are a normal part of the economic cycle, and they suck donkey dicks.

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1 minute ago, Bullneck said:

Pretty much my story, too.  The fact that the roots of these catastrophes were by and large Republican desire to deregulate and create volatility they could profit from was one reason I became a Democrat.

Exactly.  Create distrust in everything, sow discontent, profit.  Fucking carpetbaggers even 120 years later.  

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2 minutes ago, jimmyjazz said:

 

The percentage of $21.8B created since Jan 2020 ($15.4B) is 29.4%, not 41%.

 

Mea culpa. I misunderstood what he was getting at. Was distracted by the fact that the supply of money is clearly a large part of the problem. 

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1 hour ago, Immaculate Vibes said:

U ok?

New series. Same result. 
 

F73401-F5-68-B8-4-F4-A-8070-631-FF2-CEDC

I may be a fucking idiot but you’re demonstrably wrong. 

OK, so?  What do you think this proves?  We need to buy bitcoin?

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Posted (edited)
2 minutes ago, Immaculate Vibes said:

Mea culpa. I misunderstood what he was getting at. Was distracted by the fact that the supply of money is clearly a large part of the problem. 

What's the percentage of crypto created in the past three years?  Care to tell us that?

Also, the world is going to experience a wheat shortage pretty soon because of ya boy Putin.  You don't think that has anything to do with anything?

You should be arguing in favor of solar panels for everyone. Take some load off the grid, instead of wasting your time on this crypto shit.

Edited by Bullneck
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2 hours ago, Snake Diggity said:

Recession by the classic definition (2Q of negative growth) is extremely likely.  Market sentiment tied to that means a bear market is extremely likely.  The other hallmarks of dark economic times?  I don’t think they’re likely.  


There are 5M more job openings than people looking for work.  % of people on unemployment is lower than it’s been in 50 years.  Demographic trends point to a labor shortage in the short, medium, and long term.  So I just don’t see us getting into double digit unemployment, at least for many years, and possibly ever.

The dollar is very strong compared to other currencies.  So while we are seeing dramatic inflation, it’s a worldwide phenomenon.  That tells me it’s not an issue of money supply or access to capital, but an issue wholly related to the supply of goods and services.  Aside from the labor shortage, geopolitical issues are by far the largest cause.  
 

It is difficult to predict the outcome of the Russia-Ukraine conflict.  But I am hopeful it will largely resolve over the course of this year.

Certainly financial stimulus is a contributing factor to what we’re seeing, but I think it’s 3rd or 4th or 5th down the list of primary causes.

If a “soft landing” means avoiding recession, I think that ship has sailed.  I predict a deep but quick recession.  If soft landing means just getting inflation under control without sending unemployment to uncomfortable levels, I am very optimistic they’ll achieve that outcome.

This.

To your point about the labor shortage and demographic trends, this was always going to happen but covid sped things up.  Between retirements, low birth rates, and immigration declines the past six years, we simply don't have enough workers.  The baby bust really started in 2008 and when those kids start to turn 18 in a few years, the shortage in jobs teenagers occupy will get even worse.

Recessions are generally due to lack of demand and that's not the case here.  Big Retail is reporting last week and this week and almost all of them are reporting strong to quite strong sales.  United said there's basically no resistance to high fares.  Demand is strong and will be at least in the near future.

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1 hour ago, Dbeasy said:

It is amazing how fast all of the media and financial pundits have started spouting shock value headlines about a major recession and deep stock market corrections. 

Just keep in mind those pundits are probably trading on the opposite side of whatever they are saying publicly. And the Fed is trying to engineer an elevated inflation environment for the next ten years to inflate away the debt as a percentage of gdp. To do that they have to talk tough to scare everyone, slowing down runaway inflation, but then will have to lighten up once the data shows 4% inflation instead of 7-8%. 

We may have a deep stock market correction and negative gdp at some point, but the next ten years will be a 3-4% inflation environment.  

Elevated inflation is here to stay. We need it to reduce our debt load.
 

There’s also some key drivers behind it. In the same way that globalization is disinflationary, de-globalization will be inflationary. In addition, the energy transition will continue to contribute to higher energy prices. That has obvious knock on effects on prices, especially for fertilizer, then food. 
 

18 minutes ago, Bullneck said:

OK, so?  What do you think this proves?  We need to buy bitcoin?

There’s different threads for that discussion, but experience shows that rapidly inflating the money supply is destabilIzing. All the top currencies have historically had lower YoY money growth than the smaller currencies from more unstable countries. Do with that what you will. 

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Posted (edited)
8 minutes ago, Aqua Buddha said:

This.

To your point about the labor shortage and demographic trends, this was always going to happen but covid sped things up.  Between retirements, low birth rates, and immigration declines the past six years, we simply don't have enough workers.  The baby bust really started in 2008 and when those kids start to turn 18 in a few years, the shortage in jobs teenagers occupy will get even worse.

Recessions are generally due to lack of demand and that's not the case here.  Big Retail is reporting last week and this week and almost all of them are reporting strong to quite strong sales.  United said there's basically no resistance to high fares.  Demand is strong and will be at least in the near future.

One thing I think will happen is that in the future there will be a 2nd lever the government can pull to control unemployment/inflation in addition to interest rate manipulation: immigration rate.  In 10-15 years we will likely rely heavily on immigrants to grow/sustain the labor force and economy.  So when the economy overheats or unemployment skyrockets, they can turn down the immigrant spigot and not be completely reliant on interest rates.  Some really high upside scenarios with that factored in; of course, there’s risk there too, since we’d be reliant on conditions outside the US, and we’d be sacrificing our neighbors and other poorer countries to keep ourselves afloat.  But overall I think it’ll be a good thing.

 

Side note: I think it’s a good thing that the Fed’s mandate is related to inflation and unemployment, not GDP or the stock market.

Edited by Snake Diggity
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2 minutes ago, Snake Diggity said:

One thing I think will happen is that in the future there will be a 2nd lever the government can pull to control unemployment/inflation in addition to interest rate manipulation: immigration rate.  In 10-15 years we will likely rely heavily on immigrants to grow/sustain the labor force and economy.  So when the economy overheats or unemployment skyrockets, they can turn down the immigrant spigot and not be completely reliant on interest rates.  Some really high upside scenarios with that factored in; of course, there’s risk there too, since we’d be reliant on conditions outside the US, and we’d be sacrificing our neighbors and other poorer countries to keep ourselves afloat.  But overall I think it’ll be a good thing.

Other than being politically impossible, this is a great idea.

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Posted (edited)
1 minute ago, David Dennison said:

Other than being politically impossible, this is a great idea.

I think once most of the boomers have been buried, it’ll be more politically feasible.  Which will be good timing.

Edited by Snake Diggity
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8 minutes ago, Snake Diggity said:

One thing I think will happen is that in the future there will be a 2nd lever the government can pull to control unemployment/inflation in addition to interest rate manipulation: immigration rate.  In 10-15 years we will likely rely heavily on immigrants to grow/sustain the labor force and economy.  So when the economy overheats or unemployment skyrockets, they can turn down the immigrant spigot and not be completely reliant on interest rates.  Some really high upside scenarios with that factored in; of course, there’s risk there too, since we’d be reliant on conditions outside the US, and we’d be sacrificing our neighbors and other poorer countries to keep ourselves afloat.  But overall I think it’ll be a good thing.

 

Side note: I think it’s a good thing that the Fed’s mandate is related to inflation and unemployment, not GDP or the stock market.

Your immigration idea is interesting. I could get on board with that. 
 

The Fed has targeted asset prices. Bernanke specifically cited the wealth effect of high stock prices. 

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6 minutes ago, Snake Diggity said:

I think once most of the boomers have been buried, it’ll be more politically feasible.  Which will be good timing.

Lower the Medicare benefits to 55, increase the pay in to $1 million, see how many new jobs are created.  

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2 hours ago, Judge Roybeanbag said:

The timing of all these crashes is just exquisite.   I started college in 1984, crash in 1987, job market sucked when I graduated.   The 1990s were good (thanks a lot, Clinton), had kids in ‘96 and ‘98 and started my good earning years, crash in 2000.  Wiped out half of my retirement savings.  Repeat in 2008.   Now, I was magically close to the number I needed to retire and bam! I’m gonna have to work until I die, unless we get some quality nationalized healthcare.  

imo you should blame the boomers

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3 minutes ago, Immaculate Vibes said:

Your immigration idea is interesting. I could get on board with that. 
 

The Fed has targeted asset prices. Bernanke specifically cited the wealth effect of high stock prices. 

Bernanke has a lot to do with asset inflation.

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27 minutes ago, Judge Roybeanbag said:

I don’t blame anybody except the dickheads that trade our retirement accounts and reap capital gains at way less than regular income.  Thanks Reagan.   

Uhhh yeah, that's boomers that you're talking about lol

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This.
The baby bust really started in 2008 and when those kids start to turn 18 in a few years

I didn’t necessarily expect to feel ancient today, but thanks for that.
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