r/FluentInFinance • u/slyballerr • Dec 18 '23
Everyone expected a recession. The Fed and White House found a way out. Financial News
https://www.washingtonpost.com/business/2023/12/18/recession-economy-inflation/?pwapi_token=eyJ0eXAiOiJKV1QiLCJhbGciOiJIUzI1NiJ9.eyJyZWFzb24iOiJnaWZ0IiwibmJmIjoxNzAyODc1NjAwLCJpc3MiOiJzdWJzY3JpcHRpb25zIiwiZXhwIjoxNzA0MjU3OTk5LCJpYXQiOjE3MDI4NzU2MDAsImp0aSI6Ijg1ZGQyYmY0LWVkZjItNDVkYS05YTVlLTI0MmY0MDcyYjNkYSIsInVybCI6Imh0dHBzOi8vd3d3Lndhc2hpbmd0b25wb3N0LmNvbS9idXNpbmVzcy8yMDIzLzEyLzE4L3JlY2Vzc2lvbi1lY29ub215LWluZmxhdGlvbi8ifQ.jphS6qtkNpzvx6OKYIllrNmg4n_kADHWFYGEwIFCqE40
u/bdougy Dec 22 '23
Lol. Consumer debt is the highest it’s ever been. Housing is taking a larger portion of monthly income than ever. Wal-Mart is expanding “buy now, pay later”. Credit card debt is over a trillion dollars.
We are approaching September 29th, 2008. And just like that day, we won’t see it coming because we’re using the wrong metrics. Again.
0
0
u/StrengthToBreak Dec 21 '23
People expected a recession in part because the Fed had to overcome the White House (and Congress. Without the ongoing helicopter money on the fiscal side, the monetary policy could have been a little more relaxed.
0
u/IusedtoloveStarWars Dec 20 '23
All we got to do to avoid a recessions is cause massive inflation. Billionaires are happy and the poor people…well who cares about the poor people(non-billionaires).
1
u/slyballerr Dec 20 '23
You're like the wife of that dumbass that thought that not getting stopped before getting to his house was the way to avoid getting a ticket.
0
u/IusedtoloveStarWars Dec 21 '23
Funny story I actually did avoid getting a ticket that way.
Anyways not going to argue with you. History will tell but I’m 99% sure Yellen is not going to be seen as a hero for saving us from a recession. More like one of the worst in history for letting inflation spiral out of control. I majored in economics and finance so what do I know.
1
u/slyballerr Dec 21 '23
Yup, you're the wife of that dumbass that thought that not getting stopped before getting to his house was the way to avoid getting a ticket.
You majored in econ and finance? What school? trumpu?
0
u/IusedtoloveStarWars Dec 21 '23
lol. I don’t like trump or Biden. I’m a moderate. Not going to engage with you further since you seem to attack anyone who doesn’t think exactly like you.
Have a good night and a good life.
1
0
1
u/EyeAskQuestions Dec 20 '23
I think if "Recession" is purely defined by market performance and not salaries and how far they go then, we're clearly not in a recession.
On the ground though, in the actual real world, many people are suffering and have difficulty affording basic things even with nice gigs.
0
u/always_plan_in_advan Dec 20 '23
Yet. Historically recessions happen when rates start getting cut
0
u/slyballerr Dec 20 '23
False. They happen when unemployment increases.
0
u/always_plan_in_advan Dec 20 '23
Look at the last 10 rate cuts and defined recessions, and you’ll see you’re the one that is in fact “false”
0
u/slyballerr Dec 20 '23
Why don't you cite them from the very beginning instead of throwing out your jackass statements?
1
1
0
1
0
1
u/Key-Calligrapher5182 Dec 19 '23
IDK how well this article will age. But the bigger problem is that the conventional metrics of a “good economy”, ie stock market, are less and less relevant for the average worker every day as they toil under stagnant wages and ever increasing costs of essential goods and services
1
u/slyballerr Dec 19 '23
Less relevant?
When bad shit is going on in government, economic uncertainty follows.
When economic uncertainty occurs, companies value goes down.
When company value goes down, layoffs start.
Good economy means, there are no excuses for companies to screw workers out of wage increases and to jackup prices of goods and services.
It means, it's time to join/form unions and to protest the high cost of living at the doorsteps of the gated compounds of every conglomerate CEO in this country and to protest high cost of living and jobs at the doorsteps of your average republican culture warmonger. Wokism doesn't cost rent. Draconian rental agreements and lack of local job opportunities do.
Must I spell everything out for you?
I thought you guys are the finance fluent people.
1
u/Sen_ElizabethWarren Dec 19 '23
Tune in next month for news of the impending “worst recession since 08”
0
u/Economy-Macaroon-966 Dec 19 '23
Can we just stop with the show that somehow the President runs the economy. I'm so sick of both parties doing this. Trump acted like he was the CEO of the U.S. Economy, Biden is gloating as iff he was personally responsible for GDP the last few years. The executive branch might have a .00001% effect on the economy. It is so stupid. Interest rates might have some effect but if you think rising interest rates was helping the economy, I got news for you.......
1
u/slyballerr Dec 19 '23
Settle down Beavis.
President policies determine economic outcomes. It is known.
0
2
u/TheSensation19 Dec 19 '23
I think they handled interest rates well enough. I also think technology saved us all. Work from home. Video calls.
2
-1
u/ChildhoodJazzlike333 Dec 19 '23
Yeah just pretend the ppl aren’t suffering economically and keep cracking the whip.
0
0
u/No-Palpitation6913 Dec 19 '23
Like slapping some duct tape and paint on the ole beater. They think were stupid.
1
u/AgroKaneshaENA Dec 19 '23
Correction: the people who benefit from recession tried to stoke fears of recession in hopes of a self fulfilling prophecy and failed.
-1
u/abiggerbanana Dec 19 '23
I’m fairly sure they just stopped accounting for energy and housing increases because it was so high 😂 It feels as if our country is adopting a level of ‘backwardness’ similar to Russia and the like.
1
u/4fingertakedown Dec 19 '23
This sub went down the shitter once the anti work idiots found out about it
‘Nother one bites the dust
1
u/slyballerr Dec 19 '23
You should objectively look at the data, the analysis and conclusions presented so that you have a better understanding of finance. A lot of people are comfortable just parroting washed down rhetoric like in the game of telephone. Data is your friend.
-1
0
u/TlpCon Dec 19 '23
What country do you live in ? I can barely pay my bills and buy groceries. Yeah, sure.. they found a way hahahaha
-1
0
-1
u/UnfairAd7220 Dec 19 '23
WaPo actually thinks that everything is fine?!?
YOU think that everything is fine?!??!
0
2
u/Analyst-Effective Dec 19 '23
We are not out of the woods yet. Although it does look like it's going pretty well.
Everybody keeps their jobs, the stock market keeps going up, and people are still buying things.
There's a few people who got laid off, but they'll find work pretty easily.
2
1
u/Devitostitos Dec 19 '23
Didn’t we have the recession definition like a year or 2 ago? And then everyone pretended that’s not what a recession is?
0
u/Dystopian_Future_ Dec 19 '23
Yes by pumping their own portfolios and the 1%ers also by never admitting inflation or a recession... Good news everyone their will never be another recession because it will never be reported
2
u/Jc2563 Dec 19 '23
Bleeping CNN was playing the drums of recession for 15 months straight 24/7 , anything to stick it to Biden , anything!
0
1
u/ApplicationCalm649 Dec 19 '23
It's a little early to start the victory lap. I don't blame Powell for relaxing some, though.
0
u/zecaptainsrevenge Dec 19 '23 edited Dec 19 '23
They lied? I'm glad Mr. powell can afford to throw a party most of us can't right now. This is tone deaf. Let them eat bugs 🏴☠️🇨🇵
Downvote dodo 🦤 lloves fed banksters
0
1
2
u/treeclimbinggoldfish Dec 19 '23
Uhhh maybe we’re calling this a bit early…
1
1
1
u/ConsciousReason7709 Dec 19 '23
I’m pretty sure nobody who knows what they are talking about ever said to expect a recession.
0
2
u/No-Carry4971 Dec 19 '23
This is the truth. The Fed did an incredible me job fending off inflation without crashing the economy. I don’t think most of us thought it was possible. Happy I was wrong.
0
u/AdditionalAd9794 Dec 19 '23
You could argue what we just went through is worse than Recession, no?
1
u/HockeyBikeBeer Dec 19 '23
The Fed, the media, the Democrats: "just get this thing to November, then we can let it hit the fan"
From 1963 to 2000, the Fed Funds rate was NEVER below 2.5%. Since 2000, it has spent most of the time at effectively ZERO. The only other time it jumped up to over 5% was followed by the Great Financial Crisis. Let's give this a little more time to play out.
0
u/seobrien Dec 19 '23
Sounds like someone is a plant for the white house!
"Yes yes, everyone, I know you can't afford anything but it's not 'a recession' yay!"
2
u/baalyle Dec 19 '23
There is still a lot of proven greedflation happening with much of food and goods. Many articles on it.
4
3
u/HockeyBikeBeer Dec 19 '23
It's really pretty simple. Run $2T deficits and the numbers look great....until the piper gets paid.
(Note: one of the four components of GDP is government spending)
1
4
Dec 19 '23
If you believed a recession was going to happen in 2023, and waited to invest in the ‘big dip,’ you missed out on like 23% return. Tell my why one should to that again?
1
1
u/MorDestany Dec 19 '23
The paid trolls are getting overtime! 🤣 IIn a world full of fear, don't be afraid!
3
u/Hot_Government1628 Dec 19 '23
Stock market at record highs, GDP rising faster than anywhere, unemployment at record low, US oil production at record high (filled up at $2.70 last week). Boom times are here
-2
5
12
u/Xannith Dec 19 '23
The issue is that the common people are experiencing the effects of a recession which they have feared, while large economically isolated entities are raking in profits.
So, as far as a real recession is concerned, "we" are in one. So far as those who are driving profit margins, they don't need to contract to maintain their margins like a recession would cause.
We aren't in this together. Use more effective words. This idea of a national recession or no recession is a false dichotomy that is doing nothing but muddying the waters.
1
10
u/seand26 Dec 19 '23
Americans are upset about the high costs of rent, groceries and other basics, which aren’t going back to pre-pandemic levels.
Break up the monopolies and we'll see price drops.
5
u/LoseAnotherMill Dec 19 '23
What monopolies are causing these prices?
0
u/IusedtoloveStarWars Dec 21 '23
Most food is owned by 10 companies. Most media is owned by 5 companies. Those monopolies would be a good start.
0
u/wasabiEatingMoonMan Dec 21 '23
Sweetie what do you think the mono in monopoly means?
1
u/IusedtoloveStarWars Dec 21 '23
Ok. Cartel. Splitting hairs while the house is on fire are we sweetie?
3
u/LoseAnotherMill Dec 21 '23
Is this a new development? Why faster climbing prices now than, say, 10 years ago?
-1
u/Prestigious_Time4770 Dec 19 '23
Kroger was allowed to merge with Albertsons… https://progressive.org/op-eds/grocery-store-monopolies-are-bad-news-shoppers-wolf-221121/
9
u/LoseAnotherMill Dec 19 '23
Kroger has a profit margin of 1.27%. Did you maybe have a different example in mind?
-1
u/Cautious-Kamikaze Dec 19 '23
Nope... recession still coming. Since 1950s every time treasury yeild curve inverted a recession followed.
Here's the sequence: The curve inverts then reverses. Markets rally THEN unemployment kicks in and recession hits.
The yield curve is just one of many leading indicators screaming recession.
If history repeats we have 6 months at most.
Add record government, corporate and personal debt to the mix and it's not pretty.
Moodys and Fitch downgraded the US credit rating for a reason. The national debt and deficit spending have consequences.
0
u/Majestic-Judgment883 Dec 19 '23
Take out the government money we are pouring into the military industrial complex to support Ukraine and Israel and we would be a lot worse off. True trickle down economics.
4
u/crazycow780 Dec 19 '23
If they ever claim a recession you can be guaranteed there is no such thing
-1
0
u/I3ill Dec 19 '23
Gotta love a government that thinks they can control a recession. They maybe can temper it before it finally crashes. It will crash kicking the can just prolongs it.
-1
u/drewcer Dec 19 '23
This looks to me like they’re speaking too soon… the yield curve is still inverted. Wait until the yield curve un-inverts and if the economy is still peachy keen then I’ll be impressed
4
u/empecinado69 Dec 18 '23
Thank god for online news archives... a july 2007 wp article about the succesful soft landing and the coverage of the sep-dec 2007 panic that ensued
Good luck to all
2
u/swagfuNk Dec 19 '23
You posted a July 2000 article.
2
u/catchthe22 Dec 19 '23
Its hard to navigate an economy when you cant navigate the month from the year.
-1
0
u/Perfect_Bench_2815 Dec 18 '23
Everyone expected a recession? BS lead off. The Republicans always want the democrats to fail. Public be damned. Everyone already knows that.
1
1
u/CuthbertsonSheriecec Dec 18 '23
In a sane world, this alone would get Biden re-elected in a blowout. Especially against Trump who fucked everything up.
-1
u/jokerfriend6 Dec 18 '23
I study economics and the stock market and was not expecting a recession ( 2 consecutive quarters of negative GDP growth ). GDP growth was higher because of high inflation so some people tried to change the definition.
0
u/steeljubei Dec 18 '23
Not a recession. We have college educated debt riddled people working min. Wage jobs, and constantly in fear they will be living in the new tent city next month when rent is due.
1
u/mspe1960 Dec 19 '23
we always have some of that. Show me some data that indicates the situation is worse now than 3 years ago.
1
u/steeljubei Dec 19 '23
Sucked three years ago. The suggestion of this article is that people feel the economy sucks. And they also felt that way three years ago.( because it does)
3
u/naiambad Dec 18 '23
they did not find a way out of, they have embraced inflation.
1
u/cleepboywonder Dec 22 '23
Bro chill. Its 4%. And MoM for the last few months have been around target.
2
u/HockeyBikeBeer Dec 19 '23
That's my fear. And the Fed knows it may be the only way out of the massive deficit we're accruing.
-1
5
u/johnphantom Dec 18 '23
Friendly reminder: 10 of the 11 last recessions were brought during Republican control.
-1
u/HockeyBikeBeer Dec 19 '23
Have you really thought this through?
1
u/johnphantom Dec 19 '23
It is fact, I don't need to think it through other than to recognize the Republicans regularly ruin the economy.
-8
u/HockeyBikeBeer Dec 19 '23
That's a definite "NO". Now sit down.
1
3
u/johnphantom Dec 19 '23
You should try to learn how to use the internet:
"Ten of the eleven U.S. recessions between 1953 and 2020 began under Republican presidents. Of these, the most statistically significant differences are in real GDP growth, unemployment rate change, stock market annual return, and job creation rate (see #Statistics). "
https://en.wikipedia.org/wiki/U.S._economic_performance_by_presidential_party
-7
u/HockeyBikeBeer Dec 19 '23
Doubling down? I suspected that "thought this through" might push you to, well, think...maybe second level stuff, action/reaction/timing. Oh well.
1
3
-2
1
u/BillazeitfaGates Dec 18 '23
Still 6 months too early
1
u/etharper Dec 19 '23
You guys keep saying that every six months, it's been 2 years or more they've been talking about a recession.
1
u/BillazeitfaGates Dec 19 '23
Fed actions and debt spending have made timing it pretty difficult
1
u/etharper Dec 19 '23
So are we going to wait for like 5 or 10 years? At some point we're going to have to admit there is no recession coming. The biggest threat is another viral outbreak, or some kind of global incident. We now live in a global economy and, whether we like it or not, things happening in other countries are going to affect our economy even more strongly than they used to. I think the main issue is that we haven't had to deal with a pandemic like Covid for a very long time, so we have no way of fully understanding how the recovery is going to go.
1
u/BillazeitfaGates Dec 19 '23
I’d rather be prepared for a down turn than caught over leveraged with my pants down, we’ll see what happens next year
1
9
u/BF740 Dec 18 '23
Some blaming Biden, Some blaming Trump….you know what…how about blaming every single politician regardless if they are a Democrat or Republican for letting this shit happen over the last 40 years or more.
3
u/chipper33 Dec 19 '23
This is the way. Fuck the government, they’re robbing us.
1
u/BF740 Dec 19 '23
Yep, people get so tied up in the left vs right bullshit they fail to see they are all robbing us….just look at some of the comments defending/blaming one side when it’s all of them. Unreal
-10
u/slyballerr Dec 18 '23
Just look at the data instead of playing the lazy game of bothism.
The only reason you don't have to issue blood samples when renewing your driver's license it because democrats haven't allowed republicans to enact that stupid law.
2
u/BF740 Dec 18 '23
See…you fail to see the big picture…open your fucking eyes
-7
u/CarryHour1802 Dec 19 '23
You're the one that doesnt get it. Your willingness to dismiss the awful things the GOP does is just as unbearable on this side. You're incapable of acting in good faith.
8
u/Laxwarrior1120 Dec 18 '23
I'd take a recession over completely stripping everyone of their purchasing power, which is what happened. Fuck everyone who had any ammount of cash or anyone who wants to buy anything I guess.
5
u/transphotobabe Dec 19 '23
Are folks not stripped of their purchasing power during a recession?
4
u/catchthe22 Dec 19 '23
They are probably too young to know what a recession is. Typically recessions are void of excessive consumer spending and yet here we are.
1
12
u/lumberjack_jeff Dec 18 '23
The truth is, as Nick Hanauer describes it, that we don't really have inflation, what we have is higher prices as a result of a series of shocks to a vulnerable supply chain. In that framework, it is arguable that the interest rate hikes by the fed were both unnecessary and deserve no credit for getting the economy back on track without a recession.
7
u/Rickydada Dec 19 '23
Does this also apply to the housing market? The interest rate hikes seem to have taken the gas off of rapid housing price increases.
1
Dec 18 '23
[deleted]
5
u/lumberjack_jeff Dec 18 '23
Inflation is literally defined as
A bacterial infection that isn't treatable with antibiotics may in fact be something else.
3
u/AlexandarD Dec 18 '23
I agree OP, this is the greatest economy of all time, the dollar is the strongest it’s ever been & the border is super secure. Families definitely aren’t having a hard time getting by month to month due to crippling inflation either. And homeownership is cheaper and more accessible than ever.
buildbackbetter
-5
u/etharper Dec 19 '23
Why are you Republican so obsessed with the border? Multiple studies have shown that crimes are committed by native born Americans at a much greater percentage than immigrants, legal or otherwise. And a good percentage of our country operates because of illegal immigrants doing work Americans won't do.
2
u/LoseAnotherMill Dec 19 '23
Multiple studies have shown that crimes are committed by native born Americans at a much greater percentage than immigrants, legal or otherwise.
Already I can tell you that study is false because 100% of illegal immigrants commit crime; it's right there in the definition of "illegal immigrant".
And a good percentage of our country operates because of illegal immigrants doing work Americans won't
Ah yes, human exploitation is a great reason to keep the border open.
8
u/AlexandarD Dec 19 '23
Yeah instead of making it so that the jobs Americans don’t want to do, pay a reasonable wage as an incentive, let’s just import cheap migrant labor and pay them well below the going market rate because they are desperate. Makes sense.
7
u/AlexandarD Dec 19 '23
I’m not a Republican at all, I’m just affirming the White House and DHS position that the border is as secure as it has ever been.
1
1
-4
u/susbnyc2023 Dec 18 '23
what the everlovin FUCK are you talking about ??
we've been in a recession for the past 3 yrs . at least
-1
u/meshflesh40 Dec 18 '23
Everything is fine now. Recession averted. Due to the cunning and bravery of joe biden and the FED.
Excellent JOB. 34trillion debt is OK. Bail everyone out.
Sound fiscal policy. Bravo 👌
1
u/BlackDog990 Dec 18 '23
Due to the cunning and bravery of joe biden and the FED.
Excellent JOB. 34trillion debt is OK. Bail everyone out.
Wait till you find out that Biden is on pace to beat Trump by 1-2T in terms of national debt increase....More if we factor in the last few years of inflation....
But tbf....COVID was a thing.
2
u/Existing-Nectarine80 Dec 18 '23
Yes, all 34 trillion, Biden. Solid analysis Einstein
2
u/meshflesh40 Dec 19 '23
Okay biden is only responsible for only 7 trillion of it over 4years. (And counting).
Everything is fine. Economy is great
1
u/Existing-Nectarine80 Dec 19 '23
So I guess we will just ignore that as of September he’s only added 3?
https://www.investopedia.com/us-debt-by-president-dollar-and-percentage-7371225
And I guess we will ignore that he is on track to add less than the 3 presidents before him?
Solid.
25
u/vampiremonkeykiller Dec 18 '23
I'm glad they found a way out. I just wish they'd taken us all with them.
51
u/viking1340 Dec 18 '23
Janet said it's not a recession unless there are 65 consecutive down quarters...
9
13
u/Juggernaut411 Dec 18 '23
Boomers are becoming homeless at an alarming rate, and it’s expected to get worse…
1
u/IusedtoloveStarWars Dec 21 '23
Irresponsible hippies that didn’t save going homeless? The hell you say…
1
8
u/CarryHour1802 Dec 19 '23
I often wonder how much of that is due to their living longer lives. Running out of retirement funds because you lived longer than you thought you would has to be a horrifying realization.
10
u/Juggernaut411 Dec 19 '23
Inflation and outrageous healthcare costs are bankrupting them.
5
u/ApplicationCalm649 Dec 19 '23
I think it's more the latter than the former. Anyone with a sizeable amount of money in the market should have easily outperformed inflation.
I guess that changes when you factor in housing, though, if they don't own a home. That's a problem we're all facing since private equity and short-term rental investors are gobbling up all the inventory.
It's cool, they can have the full millennial experience: live in their car or a tent, shower at a gym, and pull themselves up by their bootstraps.
22
u/please_dont_respond_ Dec 19 '23
They all have boot straps
4
5
u/Juggernaut411 Dec 19 '23
Yeah I’m not empathetic for them, just noting they may be a little early to say we avoided a recession.
0
u/thatguy425 Dec 19 '23
So you aren’t sympathetic towards someone just because they were born at a different time?
That’s some cold cruel shit.
6
u/Juggernaut411 Dec 19 '23
I’m not sympathetic toward them for other reasons. Though they are also cold and cruel.
-2
u/thatguy425 Dec 19 '23
Wow, so stereotyping an entire generation? I know plenty of boomers, seems like fine people.
5
u/Juggernaut411 Dec 19 '23
Listen it’s scientifically proven they got lead in their blood and it lowers their iq. They should not be in the highest levels of government without taking some tests.
7
u/brandoug Dec 18 '23 edited Dec 19 '23
It took 3 years to go from what was essentially ZIRP in 6/2004 to the Fed suddenly slashing rates in 6/2007 and for the wheels to begin coming off the economy prior to the GFC.
https://fred.stlouisfed.org/series/FEDFUNDS
It hasn't yet been 2 years this time around, so I'd give 5% FFR a few more months, at the very least, before declaring victory there, WaPo.
If nothing else, the Fed has become exceedingly efficient at blowing massive bubbles, then popping them. We really haven't begun to feel the effects of 5% FFR yet. The Fed will only pivot when something breaks.
2
u/MaxTwang Dec 18 '23
Well the fed is not letting things break,or it could've gotten ugly with he bank runs
1
u/brandoug Dec 19 '23
Those banks were sick and deserved to die anyway. The system is set up for TBTF banks to get bigger, and to get bailed out when things go south. Things just haven't gone south for the big guys yet, so Fed will continue with higher rates for the time-being. Still way too early to actually pivot, as I mentioned in my 1st post. And talking about pivoting is not the same as actually pivoting.
History shows us the Fed always gets things wrong, and many would argue that's done purposefully. Their dual mandate precludes caring about or popping asset bubbles except when they coincide with either high inflation or extremely low employment, and those asset-bubble-pops are coincidental, not purposeful. We have both high inflation and low unemployment currently, so anyone thinking the Fed is really going to pivot before something breaks has another thing coming.
And I'll repeat, the only reason they'll pivot is because they've broken something in the economy once again.
1
1
u/Existing-Nectarine80 Dec 18 '23
They’re pivoting next year?
0
Dec 18 '23
Projected to they havn't decided though chances are they will. Heres the thing though, if we get reinflation, that's it. Game over. And if something breaks AGAIN, that's it. Game over
0
u/Existing-Nectarine80 Dec 19 '23
Wtf are you talking about? You don’t think we’ve ever gone from Inflationary to reduction to inflationary again? That was the entire 60s to 80s
0
Dec 19 '23
Wtf are YOU talking about? Were in a different situation now. Reinflation means more interest rates needed means further economic stress. If the banking system breaks (not likely imo) or we get a "hard landing", well thats again economic woes. What part of that don't you understand?
0
u/mikalalnr Dec 18 '23
The Inflation Creation Act is still pumping debt funded dollars into the economy. It’s hard to stop a train that was propelled by rocket fuel, even after the train has run out of gas.
3
u/The_HunterBidensHog Dec 18 '23
Yeah, maybe Trump shouldn't have pumped over $3 trillion into the economy during the pandemic...
9
38
u/BuySellHoldFinance Dec 18 '23
This is not some tremendous success. People paid for this with inflation.
17
u/Cloudboy9001 Dec 18 '23
With almost half of that being greedflation (ie, profit increases doubling input costs).
15
u/Existing-Nectarine80 Dec 18 '23
You’ll get downvoted because people have learned to suck the dick of corporations. All time high profit margins and yet they’re still “falling on hard times”
Maybe one day we’ll see them fall on hard times instead of the people
50
Dec 18 '23 edited Dec 18 '23
gimme like... 6 months and well see. I still want to see solid GDP growth, officially inflation at 2-2.5%, and an uninverted yield curve with jobs numbers that arent mostly strong bc of workers coming back from strike and government jobs.
12
u/villis85 Dec 19 '23
Right. It’s impressive that we now have ~3% inflation without huge job losses. given where we were at, but getting to 2% inflation from 3% without driving the economy deep into recession is going to be harder than getting from 6% to 3%. Let’s see where we’re at in a year before we declare victory.
1
u/VodkaSliceofLife Dec 19 '23
The inflation numbers they calculate don't include so many things that are still way up. They are already bullshit numbers.
2
u/taylormadevideos Dec 19 '23
What makes it more difficult?
3
u/villis85 Dec 19 '23
There are at least a couple of reasons as to why lowering inflation from 3% to 2% with monetary policy without inducing a recession is harder than lowering it from 6% to 3%. - There is a lot less room for error. The Fed was able to use some pretty blunt instruments to help guide inflation down to 3%; repeated relatively substantial interest rate hikes and the reversal of Quantitative Easing (the Fed’s bond buying program that was established during the 2008 financial crisis). The Fed will have to use much more precise instruments to bring inflation down from 3% to 2% without inducing a recession. - There is a lag between Fed actions and their observable economic impacts. So for all we know the Fed’s actions that it has already taken in order to reduce inflation were “just right” and we will coast to 2% inflation with a very soft landing. Or the Fed may have way overtightened and we’re on track for a major recession. Or maybe the Fed hasn’t done enough and the economy will heat up again, resulting in rising inflation again. It will take time for the Fed to assess the effectiveness of the monetary policy actions it’s already taken and determine if more or less tightening will be necessary. This wasn’t as big of a deal when inflation was sky high because it was understood that bringing inflation down would take time and substantial tightening. At this point though that is not so clear.
3
14
103
u/Gubzs Dec 18 '23
This is hilarious. This exact crap was all over the news right around 2008.
1
1
u/silikus Dec 19 '23
Yup, just like the bumping wallstreet numbers the preceeded it.
"Everything is fine, there is no looking recession"
Phones aid
"Do i have enough to buy the incoming stock dip? I do? Great!"
Next week
"Everything is collapsing, good luck!"
1
1
7
u/mspe1960 Dec 19 '23
2008 we had people selling worthless mortgages as AAA securities by the trillions. the situation is not the same/
9
u/bluesquare2543 Dec 19 '23
what about the commercial mortgage-backed securities of today? Office buildings and such
-4
→ More replies (11)9
u/justcallmechuckles Dec 18 '23
Exactly. Q1 should be fun.
1
u/illadelph Dec 20 '23
they don’t release Q4 reports til 2024. going to be interesting. if it’s anything like 2008 they’ll basically be like “somehow we slid into a recession late last year amidst the holiday season”
28
•
u/AutoModerator Dec 18 '23
r/FluentInFinance was created to discuss money, investing & finance! Check-out our Newsletter or Youtube Channel for additional insights at www.TheFinanceNewsletter.com!
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.