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05-09-2024, 03:15 PM | #8295 | |
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Most of the world is already in recession, or will be very soon. The Swiss national bank just lowered their benchmark interest rate by 0.25%, in large part because their economy has been shrinking for 4(!) quarters; I remember when we called that a depression, not a recession. The rest of Europe/UK is right behind them and the only real question now is will the ECB of the BoE be the first to cut? China's problems are obvious. Assuming the West doesn't allow them to export their way out of them, it'll take the better part of a generation to get fully back on track. And the Rest of World (RoW) is suffering under the weight of their (too strong) dollar-denominated debt. Growth for them will be very difficult if not impossible. All of that federal money printing here is dragging things out, but business cycles are business cycles and we'll get there, eventually. The stagnation train is pulling into the station. Jobs in some industries are already hard to get, and people w/o jobs do not spend money unless they have to. If companies panic and start pulling the plug on all of those extra COVID hires, like the tech guys have been doing since last year, the jobs picture will deteriorate quite rapidly. That would tip us into recession - which, compared to an extended period of stagflation would actually, long run, be preferable - and then we'd get some interest rate relief from Powell. I've been saying this for quite some time and still believe it. Several million people need to lose their jobs before this cycle can end, we get a chance to clean out the deadwood, and a new cycle of properly-grounded growth can begin. Likely that'll be bad for everyone for a while, but it's necessary for a healthy economy. |
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05-09-2024, 06:18 PM | #8296 | |
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05-10-2024, 08:30 AM | #8297 | |
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05-10-2024, 12:03 PM | #8298 | |
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Even though the govt ended the covid disaster classification in 2023, states have the ability to modify/enforce the rules for 2yrs after it ended. Its at their discretion to allow exemptions and extensions to people as they please.
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05-14-2024, 07:43 AM | #8299 |
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is Chassis still around to argue? wholesale inflation still up over expectations
https://www.foxbusiness.com/economy/...ion-april-2024
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05-14-2024, 10:43 AM | #8300 |
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PPI up 0.1% yoy after 13 months deflating (prices going down). For the record keepers, that is a 1.001x increase in producer prices on a YOY basis. In other words zero inflation.
Manufacturing data muy bueno. Automotive manufacturing is at ATH. Reshoring is real. France is catching on to reshoring. Mexico is a hot market for new factory investment. It’s a de-globalization megatrend. All good in the neighborhood. Last edited by chassis; 05-14-2024 at 10:53 AM.. |
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05-14-2024, 12:18 PM | #8301 | |
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05-14-2024, 01:11 PM | #8302 | |||
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WRT PPI (Source - BLS PPI Home Page): Quote:
WRT Manufacturing (Source - Trading Economics Manufacturing PMI Page): Quote:
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05-15-2024, 08:28 AM | #8303 |
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CPI increase of 0.3 vs 0.4 expected... so below crazy expectations BUT still 3.4% annualized or in other words way above any 2% target... on top of that retail sales were significantly down-
https://www.cnbc.com/2024/05/15/cpi-...-in-april.html This sounds an awful lot like stagflation to me.
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05-15-2024, 09:17 AM | #8304 |
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Let’s align on the definition of stagflation.
Will the luminaries in this thread please describe stagflation in 25 words or less, using your own words, no interweb (Google etc) support. |
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05-15-2024, 10:15 AM | #8305 | |
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Generally, persistent high inflation at the same time economic growth is low or zero. More specifically, inflation well above target (I’d say over 6%) for a period of at least several quarters while GDP growth rate is well below target (I’d say 0%-1.2% real), with moderate unemployment (slightly above target or higher). By those definitions, we don’t have stagflation. We have inflation pretty close to target, slightly above but close, and growth slightly below target. Perhaps I’m mired in the stagflation of the late 1970s but that’s how I see it. |
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05-15-2024, 10:44 AM | #8306 | |
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Your definition of stagflation would break the country in like 3 months so that's a bit extreme to say the least. Reality is that inflation is still high, unemployment is consistently rising, retail sales are significantly down, housing market is in a standstill and most gdp growth is coming strictly from govt spending... hate to say it, thats what stagflation looks like in reality.
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05-15-2024, 10:44 AM | #8307 | |
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Food is flat / down and shelter is falling also. This is not stagflation but keep spouting those buzz words |
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05-15-2024, 10:47 AM | #8308 |
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absolutely wild to correlate the stock market which is pretty much a casino at this point to the health of the economy... yet some still do it... i am very interested in seeing where everyone's darling Tesla goes in the next 6 months...
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05-15-2024, 10:49 AM | #8309 | |
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05-15-2024, 10:51 AM | #8310 |
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it was always 2 quarters of negative GDP... then they said, it's more complex... like employment lol... well guess what, now we don't have that employment and employment from those days has been revised 5x now...
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05-15-2024, 10:57 AM | #8311 | |
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- food is flat - insurance is up - services are up - gas is up - shelter is going down (rent) If you’re a homeowner you’re being hit hard by insurance but that’s about it. I don’t disagree the poor people are getting hit the hardest especially with rent prices up 30% over the past 2 years but that is easing. So you’re talking about stagflation with 4% unemployment. If we had stagflation services wouldn’t be up the way they are… |
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05-15-2024, 10:59 AM | #8312 |
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That has always been the casual definition, but not what the NBER actually measures. I've said it before, but the single largest factor to the GDP drops in Q1/Q2 was the YoY decrease in government spending caused by the Covid budget.
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05-15-2024, 11:01 AM | #8313 | |
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we do know the following- inflation is above a 2% target job losses are mounting gdp growth is coming from excess govt spending almost no companies are reporting strong profits and retail sales are down so i suppose we could argue this for days but we will need "defined" metrics of this
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05-15-2024, 11:02 AM | #8314 |
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is the irony that most growth NOW is coming from massive govt spending lol?
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05-15-2024, 11:10 AM | #8315 | |
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There is no official definition of stagflation. It is a political and media term, not one economists use rigorously. Loosely it means a combination of stagnant economic growth and high inflation, and nothing more than that. Neither “stagnant” nor “high” are specified. I offered my view of those above. But that is just my view. |
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05-15-2024, 11:21 AM | #8316 |
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I mean, the data is out there if you are actually interested. The consumer (us buying things) equates to about 60% of the GDP calculation. Government spending was about flat quarter over quarter as in it didn't add that much to the Q1 GDP figure.
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