9 ms·

Parts of America may already be facing recession

69 points by joshuafkon 7y ago

proverbialbunny 7y ago
The economy was horrible for a handful of years, and when that was over, like a rubber band, the economy bounced up. This created a bubble / mini-bubble, but now that the bounce has possible finished what we're seeing is possibly more normal growth than anything. The mentality of a market slowing down being a depression or a recession is odd to me. The market slowing down leading to a depression, isn't as odd, because it can be at times a precursor. While that may be the case here, it is also entirely possible the market is simply normalizing from previous volatile times.
- maxerickson 7y ago
  The "recession" that economists use is just a technical term for a decline in activity.
  - proverbialbunny 7y ago
    Any decline in activity might be what news reporters are sensationalizing the word recession into, but that's not the proper economic definition of the word recession. >A recession is a macroeconomic term that refers to a significant decline in general economic activity in a designated region. It is typically recognized after two consecutive quarters of economic decline, as reflected by GDP in conjunction with monthly indicators like employment. Recessions are officially declared in the U.S. by a committee of experts at the National Bureau of Economic Research (NBER), who determines the peak and subsequent trough of the business cycle which demonstrates the recession. https://www.investopedia.com/terms/r/recession.asp https://www.investopedia.com/terms/r/recession.asp To dive in deeper: I don't have a proper definition of "economic decline" but as far as I am aware it means, not a slowing economy, but a dropping economy. eg, the market going down, or unemployment rising.
- legulere 7y ago
  The current economic downturn is pretty much global and hits even places that weren’t affected that much by the las economic crisis (Germany for instance)
  - xbmcuser 7y ago
    Yeah the world economy has started stagnating feels like it is tethering on the edge. After talking to our suppliers and customers in about 12-13 asian countries seems like all of them are holding their breath waiting for something to happen. Most have curtailed their current and future investments for now ironically if everyone does that it will bring about what they have started expecting.
    - proverbialbunny 7y ago
      That makes sense that people in Asia would feel that way. With the tariffs China is being hit the worst, and it's probably rippling to that general region. Also, it makes sense Germany is slowing. Germany's economy is strongly based on higher end exports, but with the drama with Brexit, and US tariffs, Germany is going to be mildly hit, but in the long run, asia has slowly been exporting higher end products. Anecdotal but, 5 years ago I'd buy German made speakers, but today the same companies are manufacturing them in China. Germany is trying to transition to white collar and has been for a few years now, trying to offer good incentives for software engineers to move to Germany.
torgian 7y ago
I feel like we never recovered from the 2008 depression. And I feel like we are due for another big one. That said, these are cycles as always.
- mieseratte 7y ago
  The economy recovered, people less so.
  - lotsofpulp 7y ago
    People’s sense of security has dropped. They are aware of automation reducing their competitiveness, aware that most of the gains are going to a few select regions of the country, and more and more business is in the hands of fewer and fewer larger entities. The numbers look good in an aggregate sense, but most individuals have less power than before.
    - ezzzzz 7y ago
      Absolutely. I've been trying to help my SO (with no College degree or trade) try to find work in the Midwest. There is definitely a surplus of jobs in our mid-tier city, but nothing with any growth potential, autonomy, dignity, benefits, etc. I find it so odd that the salary for something labor-intensive like a warehouse is on-par with a cashier. The US is becoming very dystopian.
      - non-entity 7y ago
        I've once or twice considered leaving tech altogether, but then I remember that without any sort of post secondary education, I'm condemned to barely livable jobs. Even making it in tech has been more difficult than I imagined, and I hope any 2008-type even doesn't cripple me.
      - lotsofpulp 7y ago
        The output of the US middle class can be accomplished for cheaper by others around the world (and thereby raising their wages). And with the scaling advantages that come with technology mean far fewer people can drive massive growth. I don’t need a person at a hotel front desk to check me in, I don’t need a taxi dispatcher to call me a car, and I don’t need secretaries to handle my scheduling. Automated reports remove the need for many middle management positions, and it all manifests itself as stagnant wages for warehouse type work which isn’t yet automated.
gerbilly 7y ago
When the news media starts saying "recession" it increases the chances of there being a recession.
- mieseratte 7y ago
  Fear sells, but who's buying?
  - whatshisface 7y ago
    Hedge funds and similar firms do almost all of the exchange volume. If the media talks people in to selling and nothing happens, we will see a humongous transfer of wealth to institutional investors.
- luckylion 7y ago
  The idea of free and independent media is too important to throw it out because it may make a recession hit a bit earlier. Trust in media is low as it is. Openly lying and manipulating, even with good intentions, will remove what's left.
  - whatshisface 7y ago
    Historically the media has been prone to hysterics, even to the point of cherry-picking stories just to build up the feeling of everything pointing in the same direction. The media sometimes also reports the news. The fact that it's a toss-up about whether or not the media is full of it this time is another contributing factor to the whole "the stock market is random" theory. A riskless return above inflation is infinitely valuable, because you can create unlimited amounts of new money by taking out loans in order to exploit it. So, unless someone is out there making infinite money, nobody is sure about the pending recession.
    - luckylion 7y ago
      Bad news is good news, there's no conspiracy there to push a narrative that everything is going to hell. It's what sells. If you want them to either not print those or even print "everything is fine and dandy", you need a conspiracy (because it won't work if you make it public), and you can only do that so many times before nobody believes anything you make them publish. At some point the people realize that, whatever you say, the chocolate rations have been reduced.
eschulz 7y ago
Isn't this generally the case? Even in good times certain "parts" can fall victim to poor leadership or bad luck, and therefore experience and contracting economy.
- brilliantmind 7y ago
  So you think that this is an article that could be written at any point in time but they choose the preelection opportunity to manipulate public opinion?
SamuelAdams 7y ago
I'm not sure why this article targets US Steel in particular. Plenty of companies in Michigan have been issuing WARN notices [1]. There's a handful related to manufacturing [US Steel, Venchurs Inc (which was completely shut down), Lear Corporation]. But there's plenty of other industries in this list: from white collar jobs to retail jobs. I'm curious to see if the number of WARN notices being issued by state, and the number of positions impacted in each notice, is different / higher than it has been in previous years. That's what is missing from this article: how do these layoffs compare against prior years? [1]: https://www.michigan.gov/wda/0,5303,7-304-64178_64179---,00.html https://www.michigan.gov/wda/0,5303,7-304-64178_64179---,00....
zaroth 7y ago
A few comments saying we never really recovered, or, we snapped back and now we’re slowing down back to average growth levels. I recommend taking a look at this jobs chart: https://fred.stlouisfed.org/series/USPRIV https://fred.stlouisfed.org/series/USPRIV Then set the time range to be 1997 to present. What’s remarkable is that the slope of the curve is essentially bimodal. Either the economy is hiring at 200k/month, or it is firing at 200k/month. The 2008 recession was remarkably bad. We set back jobs growth more than a decade, which had never happened before. Since then we’ve had the longest stretch of time where the economy is in “hiring mode” in history. But there was also no “snap back”, the curve has been going up, but it’s still shifted 10 years to the left. It’s not clear this stretch of up time has ended yet, but the market is flashing signals that it is more likely to end in the next 6 months than it was a year ago. With inflation so low, this to me implies there is still slack capacity and we have room to keep the “hiring” mode turned on for a while longer, but the Fed would have to lower rates for that to happen. Former Fed President Dudley’s comments in his op-ed last week were a shockingly bad look for the Fed. [1] Advocating for intentionally tanking the economy to make the current President look bad undermines the entire Fed governance model. [1] - https://www.cnbc.com/2019/08/28/the-feds-efforts-to-stay-out-of-politics-just-got-a-lot-tougher.html https://www.cnbc.com/2019/08/28/the-feds-efforts-to-stay-out...
- seanccox 7y ago
  Do you know whether the graph accounts for the recently reported error in the jobs figures? According to the Department of Labor, 500,000 fewer jobs were added in 2018-early 2019. [1] - https://www.nytimes.com/2019/08/21/business/economy/jobs-growth-revision.html https://www.nytimes.com/2019/08/21/business/economy/jobs-gro...
- hylaride 7y ago
  Most responses I've read to that op-ed were extremely negative. To blame the fed for not constantly cutting rates in response to the random and sudden actions of a mercurial (to put it nicely) president is not a bad look for the fed. It's the president who's going to be responsible for tanking the economy.
- Fjolsvith 7y ago
known 7y ago
https://archive.is/rEuML https://archive.is/rEuML
foolzcrow 7y ago
More like you want a recession. We see you regressives anti-trumpers.

69 points by joshuafkon 7y ago

The economy was horrible for a handful of years, and when that was over, like a rubber band, the economy bounced up. This created a bubble / mini-bubble, but now that the bounce has possible finished what we're seeing is possibly more normal growth than anything. The mentality of a market slowing down being a depression or a recession is odd to me. The market slowing down leading to a depression, isn't as odd, because it can be at times a precursor. While that may be the case here, it is also entirely possible the market is simply normalizing from previous volatile times.

maxerickson 7y ago
The "recession" that economists use is just a technical term for a decline in activity.
- proverbialbunny 7y ago
  Any decline in activity might be what news reporters are sensationalizing the word recession into, but that's not the proper economic definition of the word recession. >A recession is a macroeconomic term that refers to a significant decline in general economic activity in a designated region. It is typically recognized after two consecutive quarters of economic decline, as reflected by GDP in conjunction with monthly indicators like employment. Recessions are officially declared in the U.S. by a committee of experts at the National Bureau of Economic Research (NBER), who determines the peak and subsequent trough of the business cycle which demonstrates the recession. https://www.investopedia.com/terms/r/recession.asp https://www.investopedia.com/terms/r/recession.asp To dive in deeper: I don't have a proper definition of "economic decline" but as far as I am aware it means, not a slowing economy, but a dropping economy. eg, the market going down, or unemployment rising.
legulere 7y ago
The current economic downturn is pretty much global and hits even places that weren’t affected that much by the las economic crisis (Germany for instance)
- xbmcuser 7y ago
  Yeah the world economy has started stagnating feels like it is tethering on the edge. After talking to our suppliers and customers in about 12-13 asian countries seems like all of them are holding their breath waiting for something to happen. Most have curtailed their current and future investments for now ironically if everyone does that it will bring about what they have started expecting.
  - proverbialbunny 7y ago
    That makes sense that people in Asia would feel that way. With the tariffs China is being hit the worst, and it's probably rippling to that general region. Also, it makes sense Germany is slowing. Germany's economy is strongly based on higher end exports, but with the drama with Brexit, and US tariffs, Germany is going to be mildly hit, but in the long run, asia has slowly been exporting higher end products. Anecdotal but, 5 years ago I'd buy German made speakers, but today the same companies are manufacturing them in China. Germany is trying to transition to white collar and has been for a few years now, trying to offer good incentives for software engineers to move to Germany.

torgian 7y ago

I feel like we never recovered from the 2008 depression. And I feel like we are due for another big one. That said, these are cycles as always.

mieseratte 7y ago
The economy recovered, people less so.
- lotsofpulp 7y ago
  People’s sense of security has dropped. They are aware of automation reducing their competitiveness, aware that most of the gains are going to a few select regions of the country, and more and more business is in the hands of fewer and fewer larger entities. The numbers look good in an aggregate sense, but most individuals have less power than before.
  - ezzzzz 7y ago
    Absolutely. I've been trying to help my SO (with no College degree or trade) try to find work in the Midwest. There is definitely a surplus of jobs in our mid-tier city, but nothing with any growth potential, autonomy, dignity, benefits, etc. I find it so odd that the salary for something labor-intensive like a warehouse is on-par with a cashier. The US is becoming very dystopian.
    - non-entity 7y ago
      I've once or twice considered leaving tech altogether, but then I remember that without any sort of post secondary education, I'm condemned to barely livable jobs. Even making it in tech has been more difficult than I imagined, and I hope any 2008-type even doesn't cripple me.
    - lotsofpulp 7y ago
      The output of the US middle class can be accomplished for cheaper by others around the world (and thereby raising their wages). And with the scaling advantages that come with technology mean far fewer people can drive massive growth. I don’t need a person at a hotel front desk to check me in, I don’t need a taxi dispatcher to call me a car, and I don’t need secretaries to handle my scheduling. Automated reports remove the need for many middle management positions, and it all manifests itself as stagnant wages for warehouse type work which isn’t yet automated.

gerbilly 7y ago

When the news media starts saying "recession" it increases the chances of there being a recession.

mieseratte 7y ago
Fear sells, but who's buying?
- whatshisface 7y ago
  Hedge funds and similar firms do almost all of the exchange volume. If the media talks people in to selling and nothing happens, we will see a humongous transfer of wealth to institutional investors.
luckylion 7y ago
The idea of free and independent media is too important to throw it out because it may make a recession hit a bit earlier. Trust in media is low as it is. Openly lying and manipulating, even with good intentions, will remove what's left.
- whatshisface 7y ago
  Historically the media has been prone to hysterics, even to the point of cherry-picking stories just to build up the feeling of everything pointing in the same direction. The media sometimes also reports the news. The fact that it's a toss-up about whether or not the media is full of it this time is another contributing factor to the whole "the stock market is random" theory. A riskless return above inflation is infinitely valuable, because you can create unlimited amounts of new money by taking out loans in order to exploit it. So, unless someone is out there making infinite money, nobody is sure about the pending recession.
  - luckylion 7y ago
    Bad news is good news, there's no conspiracy there to push a narrative that everything is going to hell. It's what sells. If you want them to either not print those or even print "everything is fine and dandy", you need a conspiracy (because it won't work if you make it public), and you can only do that so many times before nobody believes anything you make them publish. At some point the people realize that, whatever you say, the chocolate rations have been reduced.

eschulz 7y ago

Isn't this generally the case? Even in good times certain "parts" can fall victim to poor leadership or bad luck, and therefore experience and contracting economy.

brilliantmind 7y ago
So you think that this is an article that could be written at any point in time but they choose the preelection opportunity to manipulate public opinion?

SamuelAdams 7y ago

I'm not sure why this article targets US Steel in particular. Plenty of companies in Michigan have been issuing WARN notices [1]. There's a handful related to manufacturing [US Steel, Venchurs Inc (which was completely shut down), Lear Corporation]. But there's plenty of other industries in this list: from white collar jobs to retail jobs. I'm curious to see if the number of WARN notices being issued by state, and the number of positions impacted in each notice, is different / higher than it has been in previous years. That's what is missing from this article: how do these layoffs compare against prior years? [1]: https://www.michigan.gov/wda/0,5303,7-304-64178_64179---,00.html https://www.michigan.gov/wda/0,5303,7-304-64178_64179---,00....

zaroth 7y ago

A few comments saying we never really recovered, or, we snapped back and now we’re slowing down back to average growth levels. I recommend taking a look at this jobs chart: https://fred.stlouisfed.org/series/USPRIV https://fred.stlouisfed.org/series/USPRIV Then set the time range to be 1997 to present. What’s remarkable is that the slope of the curve is essentially bimodal. Either the economy is hiring at 200k/month, or it is firing at 200k/month. The 2008 recession was remarkably bad. We set back jobs growth more than a decade, which had never happened before. Since then we’ve had the longest stretch of time where the economy is in “hiring mode” in history. But there was also no “snap back”, the curve has been going up, but it’s still shifted 10 years to the left. It’s not clear this stretch of up time has ended yet, but the market is flashing signals that it is more likely to end in the next 6 months than it was a year ago. With inflation so low, this to me implies there is still slack capacity and we have room to keep the “hiring” mode turned on for a while longer, but the Fed would have to lower rates for that to happen. Former Fed President Dudley’s comments in his op-ed last week were a shockingly bad look for the Fed. [1] Advocating for intentionally tanking the economy to make the current President look bad undermines the entire Fed governance model. [1] - https://www.cnbc.com/2019/08/28/the-feds-efforts-to-stay-out-of-politics-just-got-a-lot-tougher.html https://www.cnbc.com/2019/08/28/the-feds-efforts-to-stay-out...

seanccox 7y ago
Do you know whether the graph accounts for the recently reported error in the jobs figures? According to the Department of Labor, 500,000 fewer jobs were added in 2018-early 2019. [1] - https://www.nytimes.com/2019/08/21/business/economy/jobs-growth-revision.html https://www.nytimes.com/2019/08/21/business/economy/jobs-gro...
hylaride 7y ago
Most responses I've read to that op-ed were extremely negative. To blame the fed for not constantly cutting rates in response to the random and sudden actions of a mercurial (to put it nicely) president is not a bad look for the fed. It's the president who's going to be responsible for tanking the economy.
Fjolsvith 7y ago

known 7y ago

https://archive.is/rEuML https://archive.is/rEuML

foolzcrow 7y ago

More like you want a recession. We see you regressives anti-trumpers.