4 ms·
No. Recession for me period, when gdp grow is less than measurement error. Usually macro-statistics measurement error considered ~3-5% (more probability of 3%
by simne 4y ago
No.
Recession for me period, when gdp grow is less than measurement error.
Usually macro-statistics measurement error considered ~3-5% (more probability of 3%, less of 5%), so if measured gdp grow 2.9% it could be really 0% or even minus 0.1%, this is definitely recession.
Sure if gdp grow measured as negative, like -20% in some countries in 2020, that is, undoubtedly.
Inflation is in reality, postponed alignment of offer and proposal.
Usually happen AFTER market changes, because, on really free market, impossible to increase prices immediately, as customers will avoid buy with new prices.
Second reason, that most commodities sell with long term agreements, which prohibited immediately price changes, (accepted for example once per year change price, but before must give some serious reasons), and typically exists long chain of such agreements (tens of), so real price grow always postponed.
Only in events of really big catastrophes, like war or pandemic, chain of supply become broken, and new prices appear immediately.
If you looking for reliable indirect signs, good are consumption of gas (or natural fuels) and electricity, usually they measured very accurate and for known technology level, exists constants for exact calculation.
- fuzzfactor 4y agoI agree, not synonymous. But left unchecked the 8% rate will lead to recession. Plus the 8% measurement is likely skewed optimistically downward in addition to having an ever-widening error band of its own. Double-digit inflation may not be recognized across-the-board right now but it is already here in some places. Which gives a worse recession than you get after mere single-digit devastation.
- simne 4y ago> the 8% rate will lead to recession No, absolutely. Japan for decades constantly cool hot economy by money emission, sure have extremely large inflation on some products, and no recession.
- simne 4y agoOne more example - in ~2017 Ukraine received about 20% grow of gdp, because spike of world prices of chemical industry. Even considering, ALL officials know Japan case, nobody cared, about make emission. Because of large grow of export (counted in money), at end of 2017 year, Ukrainian currency hryvnya grown against usd, and Ukrainian exporters suffered huge losses, because their clients don't want overpay, but they have economy tied to usd-hrn conversion rate (they pay compensations to workers in hrn). Then suffered losses all business working at internal market, because local money becomes very expensive, so their circulating money shrinked. So country have losses because have not made emission. Next year world prices dropped again, and country catch small recession.