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Part of me wonders if we are talking ourselves into a recession, the market is definitely spooked about how China's growth slowdown affects the global economy b
by 40acres 8y ago
Part of me wonders if we are talking ourselves into a recession, the market is definitely spooked about how China's growth slowdown affects the global economy but in terms of wages and unemployment the US economy still has a long ways to go. For instance African American unemployment is at record lows but still around 6%. Many people are working gig economy jobs and part time and would love a full time opportunity. Growth (discounting tax cuts) is low but stable, so is wages.. so is inflation.
If anything is going to trigger a recession I would put my money on corporate debt, so many companies are loaded with debt that will rear it's ugly head the moment any slowdown in growth is on the horizon. That will trigger lower spending, job cuts, and other means that would bring us into recession.
- TheLuddite 8y agoRecessions are usually triggered by market sentiment...unless a volcano explodes and blocks off the Sun or something like that.
- mrep 8y agoMarket sentiment effects it but I don't think it is usually the trigger. Wikipedia doesn't have anything on triggers but I remember my econ textbooks taking about it and there is usually one thing that pushes it over the edge like oil shocks or the housing loan defaults.
- auiya 8y agoOr student loan defaults?
- lotsofpulp 8y agoExpectations not being met causing loan defaults causes economic contract. When expectations are not met, then loans begin to be defaulted on and revenue estimates are missed, and future expectations need to be tampered, hence contraction as they are pulled back into reality.