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There never was a real recession - it's an artifact of year-over-year numbers that were so skewed from pandemic effects. Pent-up consumer demand shifted much a

There never was a real recession - it's an artifact of year-over-year numbers that were so skewed from pandemic effects. Pent-up consumer demand shifted much activity from 2020 into 2021. This is the source of all the apparent weirdness. Every yearly number in 2021 looked great thanks to comparing an artificially high number to an artificially low 2020 baseline. Then every yearly number from 2022 looks terrible, because it's comparing to 2021's number that was artificially high from time-shifted demand. Remember the "great resignation"? That was an illusion - it was just normal pent-up demand for job switching that didn't happen during the pandemic. The inflation of 2022 is also largely an illusion - it's really just that a few percentage points of what should have been normal inflation in 2020 and first-half 2021 was time-shifted into 2022. (The inflation is real, but the timing is an illusion - it's not really 8% per year, it's a fairly normal 12% over three years.) If you believe any year-over-year number from 2021 or 2022, you're falling for headline click-bait without considering the underlying irregularities.

landoftheice 4y ago
christkv 4y ago
I really hope you are right but the massive debt taken on by all the western countries has me worried about their ability to actually respond to a hard recession if it hits this winter.
- nequo 4y ago
  Public debt is a strange thing. The gross public debt of the US is 135% of its GDP[1] but Japan has it at 266%[2] and they've done okay so far, too. [1] https://en.wikipedia.org/wiki/National_debt_of_the_United_States https://en.wikipedia.org/wiki/National_debt_of_the_United_St... [2] https://en.wikipedia.org/wiki/National_debt_of_Japan https://en.wikipedia.org/wiki/National_debt_of_Japan
com2kid 4y ago
> The inflation of 2022 is also largely an illusion - it's really just that a few percentage points of what should have been normal inflation in 2020 and first-half 2021 was time-shifted into 2022. Food prices are up 48% at the nations second largest grocery chain. Rent prices are now through the roof, 20-30% year over year increases are common in major cities. Things are more expensive, full stop, and it isn't just "an extra year" more expensive.
- vikingerik 4y ago
  That's exactly what I'm talking about. Don't look at year-over-year numbers, you're falling for the illusion. A rent jump of 20% for 2022 is because rents were artificially suppressed in 2020 and 2021. The right comparison is to look at 2022 compared to 2019 and see if it looks out of line for a three-year period. A few things are, but most aren't. Also, citing one grocery chain is a cherry-picked outlier. Cite them all if you want a real number and not an artificial illusion.
  - keester 4y ago
    rent did not go down in 2020
    - LUmBULtERA 4y ago
      It went down significantly in 2021 for me. Though it popped back up a lot in 2022 if we signed a new lease (did not).
  - idiotsecant 4y ago
    This line of thought doesn't stand up to scrutiny when you look at real data. According to the USDA ERS food price outlook reports @ https://www.ers.usda.gov/data-products/food-price-outlook/ https://www.ers.usda.gov/data-products/food-price-outlook/ the 20 year average percent change year on year is something like 2.0% - 2.5%. The change from sept. 2021 to sept 2022 has been 11.2%. The forecasted change in 2022 is approximately 10%. The foretasted change in 2023 is approximately 3.5%. This is dramatically more than just delayed increases from a strange year.
nightski 4y ago
The data just does not seem to line up with your assessment. Labor force participation rate is down 1% since pre-pandemic. It's not earth shattering, but it is quite a drop. Also inflation is hardly a few percentage points of catch up. Look at the chart below and tell me you still believe that. https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm https://www.bls.gov/charts/consumer-price-index/consumer-pri... Not to mention food/gas is worse which is what hits people in low to mid income ranges the most.
- bryanlarsen 4y ago
  LFPR is up for people under 50. The drop in overall LFPR can be almost entirely attributed to the drop in immigration during the pandemic.
  - bumby 4y ago
    >overall LFPR can be almost entirely attributed to the drop in immigration during the pandemic. I just heard a report this morning that there was a very real labor participation rate drop among women, particularly with working mothers. How does your immigration hypothesis align with that? Is it that child care work is primarily driven by immigrant workers? Or is it that other groups more than make up for that in the general statistic?
    - bryanlarsen 4y ago
      Probably the latter. The LFPR for <25 saw a significant bump.
scythe 4y ago
>a fairly normal 12% over three years That's roughly double the Fed target rate — annualized 3.8%, which would be the highest any year save 2008, which was itself an anomaly due to the GFC. The last time inflation exceeded 3.5%, save 2008, was in 1991. So 12% in three years is in no sense normal (for the USA). The inflation is real, and it's serious. It's actually produced a reduction in real wages [1] despite much excitement about workers' bargaining power. Progressives complaining about the Fed (which is finally reacting reasonably) seem to be missing that preventing a wage–price spiral is not the same thing as union-busting. 1: https://www.bls.gov/news.release/realer.nr0.htm https://www.bls.gov/news.release/realer.nr0.htm
caycep 4y ago
The problem is that it is in the political interests of a lot of groups that many people believe it...
metacritic12 4y ago
12% inflation over 3 years is not normal. The previous time it was 12% over any 3 years was back in the raging inflation years of the early 1980s. Finally, it's not even 12% -- if you look at the 3 year chart here, it's 16% over 3 years, even less normal: https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL

landoftheice 4y ago

christkv 4y ago

I really hope you are right but the massive debt taken on by all the western countries has me worried about their ability to actually respond to a hard recession if it hits this winter.

nequo 4y ago
Public debt is a strange thing. The gross public debt of the US is 135% of its GDP[1] but Japan has it at 266%[2] and they've done okay so far, too. [1] https://en.wikipedia.org/wiki/National_debt_of_the_United_States https://en.wikipedia.org/wiki/National_debt_of_the_United_St... [2] https://en.wikipedia.org/wiki/National_debt_of_Japan https://en.wikipedia.org/wiki/National_debt_of_Japan

com2kid 4y ago

> The inflation of 2022 is also largely an illusion - it's really just that a few percentage points of what should have been normal inflation in 2020 and first-half 2021 was time-shifted into 2022. Food prices are up 48% at the nations second largest grocery chain. Rent prices are now through the roof, 20-30% year over year increases are common in major cities. Things are more expensive, full stop, and it isn't just "an extra year" more expensive.

vikingerik 4y ago
That's exactly what I'm talking about. Don't look at year-over-year numbers, you're falling for the illusion. A rent jump of 20% for 2022 is because rents were artificially suppressed in 2020 and 2021. The right comparison is to look at 2022 compared to 2019 and see if it looks out of line for a three-year period. A few things are, but most aren't. Also, citing one grocery chain is a cherry-picked outlier. Cite them all if you want a real number and not an artificial illusion.
- keester 4y ago
  rent did not go down in 2020
  - LUmBULtERA 4y ago
    It went down significantly in 2021 for me. Though it popped back up a lot in 2022 if we signed a new lease (did not).
- idiotsecant 4y ago
  This line of thought doesn't stand up to scrutiny when you look at real data. According to the USDA ERS food price outlook reports @ https://www.ers.usda.gov/data-products/food-price-outlook/ https://www.ers.usda.gov/data-products/food-price-outlook/ the 20 year average percent change year on year is something like 2.0% - 2.5%. The change from sept. 2021 to sept 2022 has been 11.2%. The forecasted change in 2022 is approximately 10%. The foretasted change in 2023 is approximately 3.5%. This is dramatically more than just delayed increases from a strange year.

nightski 4y ago

The data just does not seem to line up with your assessment. Labor force participation rate is down 1% since pre-pandemic. It's not earth shattering, but it is quite a drop. Also inflation is hardly a few percentage points of catch up. Look at the chart below and tell me you still believe that. https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm https://www.bls.gov/charts/consumer-price-index/consumer-pri... Not to mention food/gas is worse which is what hits people in low to mid income ranges the most.

bryanlarsen 4y ago
LFPR is up for people under 50. The drop in overall LFPR can be almost entirely attributed to the drop in immigration during the pandemic.
- bumby 4y ago
  >overall LFPR can be almost entirely attributed to the drop in immigration during the pandemic. I just heard a report this morning that there was a very real labor participation rate drop among women, particularly with working mothers. How does your immigration hypothesis align with that? Is it that child care work is primarily driven by immigrant workers? Or is it that other groups more than make up for that in the general statistic?
  - bryanlarsen 4y ago
    Probably the latter. The LFPR for <25 saw a significant bump.

scythe 4y ago

>a fairly normal 12% over three years That's roughly double the Fed target rate — annualized 3.8%, which would be the highest any year save 2008, which was itself an anomaly due to the GFC. The last time inflation exceeded 3.5%, save 2008, was in 1991. So 12% in three years is in no sense normal (for the USA). The inflation is real, and it's serious. It's actually produced a reduction in real wages [1] despite much excitement about workers' bargaining power. Progressives complaining about the Fed (which is finally reacting reasonably) seem to be missing that preventing a wage–price spiral is not the same thing as union-busting. 1: https://www.bls.gov/news.release/realer.nr0.htm https://www.bls.gov/news.release/realer.nr0.htm

caycep 4y ago

The problem is that it is in the political interests of a lot of groups that many people believe it...

metacritic12 4y ago

12% inflation over 3 years is not normal. The previous time it was 12% over any 3 years was back in the raging inflation years of the early 1980s. Finally, it's not even 12% -- if you look at the 3 year chart here, it's 16% over 3 years, even less normal: https://fred.stlouisfed.org/series/CPIAUCSL https://fred.stlouisfed.org/series/CPIAUCSL