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> It seems like all of the FAANGs have made severe strategic cockups I’m becoming more and more convinced that they’re preparing for a global recession. I pos

> It seems like all of the FAANGs have made severe strategic cockups I’m becoming more and more convinced that they’re preparing for a global recession. I posed such an Ask HN a while ago, before the Microsoft layoffs, where the general takeaway was that there’s no indication for a recession. However, after the 10+12K layoffs by the giants, and constant news about smaller layoffs by smaller companies (in the 100s per announcement), I think the situation becomes at once clearer and bleaker. We shall survive.

DrBazza 4y ago
> I’m becoming more and more convinced that they’re preparing for a global recession. The tech industry famously over inflated once before in the original dotcom boom. This just seems like another correction. I don't think the tech industry is big enough to trigger a global recession on its own, but then again, the financial industry have a herd and panic mentality, so perhaps it could trigger a sell-off for no real economic reason.
- SuoDuanDao 4y ago
  The recession would be triggered by the end of cheap money we've had since around 2010. The absurd spike in the tech industry's P/E ratios would just be one of the first indicators that situation was getting wonky.
csa 4y ago
> I’m becoming more and more convinced that they’re preparing for a global recession. I think it’s more like “we are trimming some of the aggressive hiring we did during COVID now that current revenues tell us that the online economy paradigm shift was not as large as we thought it may have been (but we were prepared for)”. Many/most of these tech giants cuts still leave staffing levels at 2019 numbers or higher.
- shapefrog 4y ago
  > Many/most of these tech giants cuts still leave staffing levels at 2019 numbers or higher Many/most of these tech giants cuts still leave staffing levels at 2021/2022 numbers or higher.
  - saiya-jin 4y ago
    I don't get the panic mode some folks here seem to fall into pretty quickly, probably young/junior ones. Numbers alone do seem scary, but then you 1) put it into global count perspective, we never so far go above few % which ie in banking is simply a no-story, usual yearly culls, every effin' year, sometimes more than once. And 2) all of these greedy companies over-hired massively during covid (and we talk about tens of thousands of hires per giant), so now are shockingly trimming that swing that ended up differently than they wrongly predicted (thank god for that). Once we will see trims going into 30% territory we can have a story. Now of course its pretty crappy if you are one of those affected, ie those 5%. If we are going to see serious employment issues in IT this is not yet it (and I see few reasons for that personally, but what do I know...)
- mk89 4y ago
  Agreed 100% with this. Plus many took advantage of this "chaos" to get rid of products they don't want to do anymore - my company did the same. It had very little to do with the global recession etc.
rsynnott 4y ago
> However, after the 10+12K layoffs by the giants, and constant news about smaller layoffs by smaller companies (in the 100s per announcement), I think the situation becomes at once clearer and bleaker. The major economies are posting record or near-record levels of employment; layoffs in one section of one sector are not a particularly good signal for recession one way or another.
- paganel 4y ago
  > he major economies are posting record or near-record levels of employment; When you're paid peanuts compared to the real cost of living those "near-record levels of employment" don't matter that much anymore.
  - UncleEntity 4y ago
    How many places that pay peanuts that you’ve been to in the last couple years don’t have “help wanted” on their front door? Or a sign on the street? Or a billboard?
- phpisthebest 4y ago
  >>The major economies are posting record or near-record levels of employment; Where? Every chart I have seen shows total number of positions below pre pandemic levels, work force participation is down Sure unemployment U3 numbers are still low on a national aggregate in the US, but regionally (including Silicon Valley) they are spiking heavily, and that is after they heavily manipulate the U3 to make unemployment look good by not counting HUGE numbers of people that are unemployed. So I disagree that employment end of the economy looks good unless you cherry pick data
  - rsynnott 4y ago
    US employment for 2019 was 158M (then a record high), falling sharply to 148M in 2020, and recovering to 158M in 2022; it's currently 160M: https://www.statista.com/statistics/269959/employment-in-the-united-states/ https://www.statista.com/statistics/269959/employment-in-the... (It is true that the _percentage employed_ hasn't recovered after covid; given the US's aging population it's possible that that figure will _never_ rise to where it was again. As they say, you can prove anything with statistics....)
lm28469 4y ago
What if most companies have no long term vision and just follow the trend, like when they all hired hundred/thousands of employees during covid for seemingly no reasons
- lukan 4y ago
  "during covid for seemingly no reasons" During covid the demand for online services went way up, media consumption, remote work and study. They had to try to increase their share of it and now they scale back.
  - stefan_ 4y ago
    You say that like they knew that. No, they were thinking it was going to be a recession. It's all just cargo culting nonsense.
  - netheril96 4y ago
    During the same time the Fed repeatedly suggested that the interest hike would come soon, yet none of these companies prepared for that at all.
    - creakingstairs 4y ago
      I do agree with you that those companies should have prepared for the hike but I also remember Powell saying “inflation is transitory” :p
      - nkozyra 4y ago
        Well, inflation is demonstrably transitory. But the impact to these companies is, in general, less about inflation and more about free money.
    - BurningFrog 4y ago
      If you can find a quote for that, I'd be surprised. As I remember it, the Fed kept saying things were fine until faced with at a hard, cold 8.5% inflation rate.
glenngillen 4y ago
I’m with you, though with a fraction less pessimism. I’m not buying into the collusion to compress wages or unchecked hiring that is becoming exposed theories. These a companies with globe spanning businesses the touch much of the world every single day (I’d put Stripe in this bucket too). They’ve got much greater and earlier visibility into the state of the broader economy long before governments do. Why don’t we assume they’re a leading indicator of things to come? Why do these moves apparently only make sense when everyone else has finally come to the same conclusion? The silver linings for me so far has been that a) for many of the bigger companies the reduction is only bringing them back to their pre-pandemic levels of still very huge companies and b) the open lists of laid off people some of these companies have produced at first glance seem to skew very heavy towards recruiters/HR and marketing. Which makes sense if you’re not expecting much growth over the next year.
- hhlevnjak2 4y ago
  Even if you don't know the economy will slow down, the uncertainty alone will still make companies extra careful. Where a lot of IT budgets were only guidelines, they are becoming rules now. Layoffs send a message internally and externally about it. Any reasonably sized company will have people who aren't really contributing anything, this is just an opportune moment to cut some of them and avoid the backlash since "everyone else is doing it".
- tryagainynot 4y ago
  > I’m not buying into the collusion to compress wages or unchecked hiring that is becoming exposed theories. Why not? Every FAANG company has been accused of colluding with each other to suppress (not compress) wages. https://www.cnet.com/tech/tech-industry/apple-google-others-settle-anti-poaching-lawsuit-for-415-million/ https://www.cnet.com/tech/tech-industry/apple-google-others-... They have literally been tried, and admitted guilt, for doing exactly this.
- md_ 4y ago
  > These a companies with globe spanning businesses the touch much of the world every single day (I’d put Stripe in this bucket too). They’ve got much greater and earlier visibility into the state of the broader economy long before governments do. If that were true, I'd expect them to have hugely profitable proprietary trading desks, which does not seem to be the case?
refurb 4y ago
I keep getting reminded of that scene from the movie Margin Call about the 2008 financial crisis (great movie by the way): There are three ways to make a living in this business: be first; be smarter; or cheat. Now, I don't cheat. And although I like to think we have some pretty smart people in this building, it sure is a hell of a lot easier to just be first. The recession might not be here yet, but it’s a lot easier to reduce costs before it hits.
quonn 4y ago
Okay, but why would these companies secretly know something that the rest of us doesn‘t? Maybe they are preparing, but it doesn’t tell us more about whether that‘s justified or not.
- Consultant32452 4y ago
  The fed chairman explicitly said he's going to raise interest rates until workers lose power in the market.
  - larsrc 4y ago
    [reference needed]
    - Consultant32452 4y ago
      https://mronline.org/2022/05/26/u-s-federal-reserve-says-its-goal-is-to-get-wages-down/ https://mronline.org/2022/05/26/u-s-federal-reserve-says-its... He's going to do whatever it takes to stop regular people from getting higher wages.
      - propogandist 4y ago
        he’s setting up conditions for FEDcoin (CBDC), which will be how new economic stimulus will be delivered. Spending free fedcoin will require recipient to signup for FedCoin also. Then, the real fun begins.
      - cpsns 4y ago
        Which shouldn’t come as a surprise. These people hate you, and they hate you getting any leverage. If it were up to them they’d own you.
- abm53 4y ago
  Agreed, I don’t think it is productive to have conspiratorial mindset where there is a group of insiders who have access to a key piece of information and then engage in Kremlinology to decipher their macroeconomic views. To be sure, Google will have some interesting and proprietary data, but the signal to noise ratio will still be tiny.
rvz 4y ago
> I posed such an Ask HN a while ago, before the Microsoft layoffs, where the general takeaway was that there’s no indication for a recession. I don't how this 'indication of a recession' could not have been more clearer since November 2021 as predicted a year ago. [0] We were already in a recession [1] and it just took time for the indicators to take effect. I guess now the people denying about a looming recession are now 'preparing for a recession' which is a bit too late for that. Should have prepared as early in November 2021. [0] https://news.ycombinator.com/item?id=29508238 https://news.ycombinator.com/item?id=29508238 [1] https://news.ycombinator.com/item?id=31441710 https://news.ycombinator.com/item?id=31441710
criley2 4y ago
So, if the big companies hire 40-50k new employees each over the past 2 years, and then fire 10-20k, leaving a net 30-40k employee gain for the past 2 years... that means recession? People have no context for these layoffs. This is not a "recession layoff". This has nothing in common with 2009, which I suppose many of you are too young to remember. In 2009, we lost a million jobs to layoffs in one month. You'd turn on the news and see 200k jobs disappear in front of your face, so you'd turn it off. The big tech companies laying off 1/5 of the pandemic boom hires is not a recession to me. Alphabet staff: 2018 98771 2019 118899 2020 135301 2021 156500 2022 186779 2023 174000?*
the_duke 4y ago
Recessions often are self-fulfilling prophecies. Everyone expects a recession, companies and individuals starts saving and being more frugal, which leads to an actual recession.
rpastuszak 4y ago
>I’m becoming more and more convinced that they’re preparing for a global recession. Wait, are you telling me that I picked a wrong time to quick my job and work on side projects, again?
- timq 4y ago
  There is no wrong time for that. You did the right choice.
  - jumpkick 4y ago
    /s?
phpisthebest 4y ago
>>I’m becoming more and more convinced that they’re preparing for a global recession What if left to convince you, most of them have publically stated that is one of the reasons, and the economic indicators are all there.. I am not sure why people keep denying this reality, it is just faith in government that keeps denying it?
xtracto 4y ago
People over here say there's no recession. But believing HN's assertions on global economy makes as much sense as believing it's opinions on Medical or Science threads. For financial information about the world economic situation I tend to prefer reading WorldBank, who's Global Economic Prospects for 2023 is not that positive: https://openknowledge.worldbank.org/bitstream/handle/10986/38030/GEP-January-2023-Executive-Summary.pdf https://openknowledge.worldbank.org/bitstream/handle/10986/3... --- Global growth is projected to decelerate sharply this year, to its third weakest pace in nearly three decades, overshadowed only by the 2009 and 2020 global recessions. This reflects synchronous policy tightening aimed at containing very high inflation, worsening financial conditions, and continued disruptions from the Russian Federation’s invasion of Ukraine. Investment growth in emerging market and developing economies (EMDEs) is expected to remain below its average rate of the past two decades. Further adverse shocks could push the global economy into yet another recession. Small states are especially vulnerable to such shocks because of their reliance on external trade and financing, limited economic diversification, elevated debt, and susceptibility to natural disasters. Urgent global action is needed to mitigate the risks of global recession and debt distress in EMDEs. Given limited policy space, it is critical that national policy makers ensure that any fiscal support is focused on vulnerable groups, that inflation expectations remain well anchored, and that financial systems continue to be resilient
- CPLX 4y ago
  The difference between the average random asshole on the street and the World Bank is there’s at least a chance that the asshole on the street won’t have a 20+ year history of being wrong about literally everything. The World Bank is and has always been a tool of the power structure to protect the interests of multinational capital. It’s advice is always the same: don’t spend too much money helping people so we can make sure you can always pay back first world banks and governments and don’t seize any of our friends villas or mines. You realize that’s literally what the last sentence of the quote you posted says right? The World Bank has exactly one job.
  - ezconnect 4y ago
    They are the thief of the world. Their first advice is to privatize public services so their buddies can profit off a working system.
WastingMyTime89 4y ago
> I’m becoming more and more convinced that they’re preparing for a global recession. Large publicly traded companies don't really prepare for large recessions. They are fickle beasts. They mostly react to the market feelings and are in a lot of way quaterly focused. What we are seeing now is the combination of WallStreet feeling gloomy after the rate hikes and tech companies 2022 results being under target. They are taking actions to try to protect their stock price. From my point of view, the issue tech companies are facing right now is not so much the possibility of an upcoming recession than them having finally reached the point where their impressive growth is slowing down with little chance of ever coming back to the insane rate of the 2000s and 2010s. It means their P/E ratio which has always been extremely high might slowly come back down to the economy average. That would be a very significant share price drop. If you look at the economy as a whole, signs of a major recession are not there yet. SMEs are still the heart of the economy and the bankruptcies rate remains historically low. Unemployement is also really low. Manufacturing is doing great. Energy prices are far from bad in the USA. Inflation is high but rate hikes seem to be working. I'm not an oracle. I can't predict the future. I won't tell you there won't be a recession especially in a particularly volatile international context. What I can tell you is that currently the signs don't point to us being doomed.
- propogandist 4y ago
  Manipulated numbers are keeping the illusion of healthy economy going. SPR reserve draining was key to manipulating gas prices to have taking points for US midterms and inflation calculations, for starters. Manufacturing numbers are also down https://www.zerohedge.com/economics/ism-manufacturing-contracts-2nd-month-prices-paid-new-orders-plunge https://www.zerohedge.com/economics/ism-manufacturing-contra...
  - WastingMyTime89 4y ago
    The PMI is not a manufacturing indicator. It’s a diffusion index on the value of stocks. What you are saying is that the stock market is contracting after seeing a rise at the beginning of the year (also zerohedge, come on, I thought we were having a serious discussion here).
deleted 4y ago
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bayindirh 4y ago
The biggest companies have some very strong analysis departments which warn them about these kinds of possible scenarios (recession, etc.), and the companies act with this information. There were already signs of a global economic recession elsewhere (Asia, Europe to a lesser extent), with different signs (food and energy prices, even before the war). So the companies started to take defensive action before the downturn became visible on their side of the pond. Now it's looming at the horizon, not like the dotcom bubble or the previous recession(s). I guess it'll be slower, hence it'll be longer and will cut slow and deep.
- deleted 4y ago
  [deleted]
twistedpair 4y ago
"recession" talk provides cloud cover for many a company to pare back and prune products, processes, and people in a way that would normally cause more out cry. It's not that such changes aren't needed, but they can pile up until a forcing function triggers a hard look and it's acceptable to do them.
thrwawy74 4y ago
I'm convinced industry captains are given stronger indicators from the government that a recession is happening. Yes, they have amazing advisors that could feel this out naturally. I also think senators and representatives tell them directly to prepare before the average consumer gives this forethought. It's in the government's best interest to support those with capital. All the rest of us be damned.
- SantalBlush 4y ago
  Maybe. But it's important to bear in mind that when a CEO tells the public something, their goal is to manipulate the public in a way that is beneficial to their company. They might happen to be telling the truth, but that's incidental. So when Jeff Bezos says, "Batten down the hatches," he's not actually saying it to prepare us for recession.
  - thrwawy74 4y ago
    Clearly he is selling us hatches :x
pissedgenes 4y ago
I'd still bet we avoid a recession in the US, even if certain industries (like tech) contract sharply. It's easy to forget tech is not the economy at large. What I think most people would classify as tech jobs — working in “internet publishing and broadcasting and web search portals” — are less than 0.3% of total payrolls employment. But tech makes up ~26% of the S&P 500 market cap, so tech gets a lot more media attention because the companies are so valuable. Layoffs are terrible for anyone involved. But even with the roughly 200K layoffs at public and startup tech firms in 2022 and 2023 so far, that's .001% of total US payroll employment.
BurningFrog 4y ago
The Fed has been raising interest rates at historically fast rates all year in order to fight inflation by cooling down the economy. Which is another way of saying "inducing a recession", as any educated person should know.
remote_phone 4y ago
I was in the “global recession” camp all last year but I’ve started to doubt that. I don’t see any real economic impact to companies except Meta but that was them losing market share. Otherwise all these layoffs feel like hangover recovery from over hiring the last 3 years. I think we will be fine. Hiring won’t be like the last 3 years but I also don’t think we are going to go through the Bust 2.0.
UncleMeat 4y ago
So like, lay people off when there is actually a global recession then. Jesus Christ. Revenues and profit are still up, especially at Google.

DrBazza 4y ago

> I’m becoming more and more convinced that they’re preparing for a global recession. The tech industry famously over inflated once before in the original dotcom boom. This just seems like another correction. I don't think the tech industry is big enough to trigger a global recession on its own, but then again, the financial industry have a herd and panic mentality, so perhaps it could trigger a sell-off for no real economic reason.

SuoDuanDao 4y ago
The recession would be triggered by the end of cheap money we've had since around 2010. The absurd spike in the tech industry's P/E ratios would just be one of the first indicators that situation was getting wonky.

csa 4y ago

> I’m becoming more and more convinced that they’re preparing for a global recession. I think it’s more like “we are trimming some of the aggressive hiring we did during COVID now that current revenues tell us that the online economy paradigm shift was not as large as we thought it may have been (but we were prepared for)”. Many/most of these tech giants cuts still leave staffing levels at 2019 numbers or higher.

shapefrog 4y ago
> Many/most of these tech giants cuts still leave staffing levels at 2019 numbers or higher Many/most of these tech giants cuts still leave staffing levels at 2021/2022 numbers or higher.
- saiya-jin 4y ago
  I don't get the panic mode some folks here seem to fall into pretty quickly, probably young/junior ones. Numbers alone do seem scary, but then you 1) put it into global count perspective, we never so far go above few % which ie in banking is simply a no-story, usual yearly culls, every effin' year, sometimes more than once. And 2) all of these greedy companies over-hired massively during covid (and we talk about tens of thousands of hires per giant), so now are shockingly trimming that swing that ended up differently than they wrongly predicted (thank god for that). Once we will see trims going into 30% territory we can have a story. Now of course its pretty crappy if you are one of those affected, ie those 5%. If we are going to see serious employment issues in IT this is not yet it (and I see few reasons for that personally, but what do I know...)
mk89 4y ago
Agreed 100% with this. Plus many took advantage of this "chaos" to get rid of products they don't want to do anymore - my company did the same. It had very little to do with the global recession etc.

rsynnott 4y ago

> However, after the 10+12K layoffs by the giants, and constant news about smaller layoffs by smaller companies (in the 100s per announcement), I think the situation becomes at once clearer and bleaker. The major economies are posting record or near-record levels of employment; layoffs in one section of one sector are not a particularly good signal for recession one way or another.

paganel 4y ago
> he major economies are posting record or near-record levels of employment; When you're paid peanuts compared to the real cost of living those "near-record levels of employment" don't matter that much anymore.
- UncleEntity 4y ago
  How many places that pay peanuts that you’ve been to in the last couple years don’t have “help wanted” on their front door? Or a sign on the street? Or a billboard?
phpisthebest 4y ago
>>The major economies are posting record or near-record levels of employment; Where? Every chart I have seen shows total number of positions below pre pandemic levels, work force participation is down Sure unemployment U3 numbers are still low on a national aggregate in the US, but regionally (including Silicon Valley) they are spiking heavily, and that is after they heavily manipulate the U3 to make unemployment look good by not counting HUGE numbers of people that are unemployed. So I disagree that employment end of the economy looks good unless you cherry pick data
- rsynnott 4y ago
  US employment for 2019 was 158M (then a record high), falling sharply to 148M in 2020, and recovering to 158M in 2022; it's currently 160M: https://www.statista.com/statistics/269959/employment-in-the-united-states/ https://www.statista.com/statistics/269959/employment-in-the... (It is true that the _percentage employed_ hasn't recovered after covid; given the US's aging population it's possible that that figure will _never_ rise to where it was again. As they say, you can prove anything with statistics....)

lm28469 4y ago

What if most companies have no long term vision and just follow the trend, like when they all hired hundred/thousands of employees during covid for seemingly no reasons

lukan 4y ago
"during covid for seemingly no reasons" During covid the demand for online services went way up, media consumption, remote work and study. They had to try to increase their share of it and now they scale back.
- stefan_ 4y ago
  You say that like they knew that. No, they were thinking it was going to be a recession. It's all just cargo culting nonsense.
- netheril96 4y ago
  During the same time the Fed repeatedly suggested that the interest hike would come soon, yet none of these companies prepared for that at all.
  - creakingstairs 4y ago
    I do agree with you that those companies should have prepared for the hike but I also remember Powell saying “inflation is transitory” :p
    - nkozyra 4y ago
      Well, inflation is demonstrably transitory. But the impact to these companies is, in general, less about inflation and more about free money.
  - BurningFrog 4y ago
    If you can find a quote for that, I'd be surprised. As I remember it, the Fed kept saying things were fine until faced with at a hard, cold 8.5% inflation rate.

glenngillen 4y ago

I’m with you, though with a fraction less pessimism. I’m not buying into the collusion to compress wages or unchecked hiring that is becoming exposed theories. These a companies with globe spanning businesses the touch much of the world every single day (I’d put Stripe in this bucket too). They’ve got much greater and earlier visibility into the state of the broader economy long before governments do. Why don’t we assume they’re a leading indicator of things to come? Why do these moves apparently only make sense when everyone else has finally come to the same conclusion? The silver linings for me so far has been that a) for many of the bigger companies the reduction is only bringing them back to their pre-pandemic levels of still very huge companies and b) the open lists of laid off people some of these companies have produced at first glance seem to skew very heavy towards recruiters/HR and marketing. Which makes sense if you’re not expecting much growth over the next year.

hhlevnjak2 4y ago
Even if you don't know the economy will slow down, the uncertainty alone will still make companies extra careful. Where a lot of IT budgets were only guidelines, they are becoming rules now. Layoffs send a message internally and externally about it. Any reasonably sized company will have people who aren't really contributing anything, this is just an opportune moment to cut some of them and avoid the backlash since "everyone else is doing it".
tryagainynot 4y ago
> I’m not buying into the collusion to compress wages or unchecked hiring that is becoming exposed theories. Why not? Every FAANG company has been accused of colluding with each other to suppress (not compress) wages. https://www.cnet.com/tech/tech-industry/apple-google-others-settle-anti-poaching-lawsuit-for-415-million/ https://www.cnet.com/tech/tech-industry/apple-google-others-... They have literally been tried, and admitted guilt, for doing exactly this.
md_ 4y ago
> These a companies with globe spanning businesses the touch much of the world every single day (I’d put Stripe in this bucket too). They’ve got much greater and earlier visibility into the state of the broader economy long before governments do. If that were true, I'd expect them to have hugely profitable proprietary trading desks, which does not seem to be the case?

refurb 4y ago

I keep getting reminded of that scene from the movie Margin Call about the 2008 financial crisis (great movie by the way): There are three ways to make a living in this business: be first; be smarter; or cheat. Now, I don't cheat. And although I like to think we have some pretty smart people in this building, it sure is a hell of a lot easier to just be first. The recession might not be here yet, but it’s a lot easier to reduce costs before it hits.

quonn 4y ago

Okay, but why would these companies secretly know something that the rest of us doesn‘t? Maybe they are preparing, but it doesn’t tell us more about whether that‘s justified or not.

Consultant32452 4y ago
The fed chairman explicitly said he's going to raise interest rates until workers lose power in the market.
- larsrc 4y ago
  [reference needed]
  - Consultant32452 4y ago
    https://mronline.org/2022/05/26/u-s-federal-reserve-says-its-goal-is-to-get-wages-down/ https://mronline.org/2022/05/26/u-s-federal-reserve-says-its... He's going to do whatever it takes to stop regular people from getting higher wages.
    - propogandist 4y ago
      he’s setting up conditions for FEDcoin (CBDC), which will be how new economic stimulus will be delivered. Spending free fedcoin will require recipient to signup for FedCoin also. Then, the real fun begins.
    - cpsns 4y ago
      Which shouldn’t come as a surprise. These people hate you, and they hate you getting any leverage. If it were up to them they’d own you.
abm53 4y ago
Agreed, I don’t think it is productive to have conspiratorial mindset where there is a group of insiders who have access to a key piece of information and then engage in Kremlinology to decipher their macroeconomic views. To be sure, Google will have some interesting and proprietary data, but the signal to noise ratio will still be tiny.

rvz 4y ago

> I posed such an Ask HN a while ago, before the Microsoft layoffs, where the general takeaway was that there’s no indication for a recession. I don't how this 'indication of a recession' could not have been more clearer since November 2021 as predicted a year ago. [0] We were already in a recession [1] and it just took time for the indicators to take effect. I guess now the people denying about a looming recession are now 'preparing for a recession' which is a bit too late for that. Should have prepared as early in November 2021. [0] https://news.ycombinator.com/item?id=29508238 https://news.ycombinator.com/item?id=29508238 [1] https://news.ycombinator.com/item?id=31441710 https://news.ycombinator.com/item?id=31441710

criley2 4y ago

So, if the big companies hire 40-50k new employees each over the past 2 years, and then fire 10-20k, leaving a net 30-40k employee gain for the past 2 years... that means recession? People have no context for these layoffs. This is not a "recession layoff". This has nothing in common with 2009, which I suppose many of you are too young to remember. In 2009, we lost a million jobs to layoffs in one month. You'd turn on the news and see 200k jobs disappear in front of your face, so you'd turn it off. The big tech companies laying off 1/5 of the pandemic boom hires is not a recession to me. Alphabet staff: 2018 98771 2019 118899 2020 135301 2021 156500 2022 186779 2023 174000?*

the_duke 4y ago

Recessions often are self-fulfilling prophecies. Everyone expects a recession, companies and individuals starts saving and being more frugal, which leads to an actual recession.

rpastuszak 4y ago

>I’m becoming more and more convinced that they’re preparing for a global recession. Wait, are you telling me that I picked a wrong time to quick my job and work on side projects, again?

timq 4y ago
There is no wrong time for that. You did the right choice.
- jumpkick 4y ago
  /s?

phpisthebest 4y ago

>>I’m becoming more and more convinced that they’re preparing for a global recession What if left to convince you, most of them have publically stated that is one of the reasons, and the economic indicators are all there.. I am not sure why people keep denying this reality, it is just faith in government that keeps denying it?

xtracto 4y ago

People over here say there's no recession. But believing HN's assertions on global economy makes as much sense as believing it's opinions on Medical or Science threads. For financial information about the world economic situation I tend to prefer reading WorldBank, who's Global Economic Prospects for 2023 is not that positive: https://openknowledge.worldbank.org/bitstream/handle/10986/38030/GEP-January-2023-Executive-Summary.pdf https://openknowledge.worldbank.org/bitstream/handle/10986/3... --- Global growth is projected to decelerate sharply this year, to its third weakest pace in nearly three decades, overshadowed only by the 2009 and 2020 global recessions. This reflects synchronous policy tightening aimed at containing very high inflation, worsening financial conditions, and continued disruptions from the Russian Federation’s invasion of Ukraine. Investment growth in emerging market and developing economies (EMDEs) is expected to remain below its average rate of the past two decades. Further adverse shocks could push the global economy into yet another recession. Small states are especially vulnerable to such shocks because of their reliance on external trade and financing, limited economic diversification, elevated debt, and susceptibility to natural disasters. Urgent global action is needed to mitigate the risks of global recession and debt distress in EMDEs. Given limited policy space, it is critical that national policy makers ensure that any fiscal support is focused on vulnerable groups, that inflation expectations remain well anchored, and that financial systems continue to be resilient

CPLX 4y ago
The difference between the average random asshole on the street and the World Bank is there’s at least a chance that the asshole on the street won’t have a 20+ year history of being wrong about literally everything. The World Bank is and has always been a tool of the power structure to protect the interests of multinational capital. It’s advice is always the same: don’t spend too much money helping people so we can make sure you can always pay back first world banks and governments and don’t seize any of our friends villas or mines. You realize that’s literally what the last sentence of the quote you posted says right? The World Bank has exactly one job.
- ezconnect 4y ago
  They are the thief of the world. Their first advice is to privatize public services so their buddies can profit off a working system.

WastingMyTime89 4y ago

> I’m becoming more and more convinced that they’re preparing for a global recession. Large publicly traded companies don't really prepare for large recessions. They are fickle beasts. They mostly react to the market feelings and are in a lot of way quaterly focused. What we are seeing now is the combination of WallStreet feeling gloomy after the rate hikes and tech companies 2022 results being under target. They are taking actions to try to protect their stock price. From my point of view, the issue tech companies are facing right now is not so much the possibility of an upcoming recession than them having finally reached the point where their impressive growth is slowing down with little chance of ever coming back to the insane rate of the 2000s and 2010s. It means their P/E ratio which has always been extremely high might slowly come back down to the economy average. That would be a very significant share price drop. If you look at the economy as a whole, signs of a major recession are not there yet. SMEs are still the heart of the economy and the bankruptcies rate remains historically low. Unemployement is also really low. Manufacturing is doing great. Energy prices are far from bad in the USA. Inflation is high but rate hikes seem to be working. I'm not an oracle. I can't predict the future. I won't tell you there won't be a recession especially in a particularly volatile international context. What I can tell you is that currently the signs don't point to us being doomed.

propogandist 4y ago
Manipulated numbers are keeping the illusion of healthy economy going. SPR reserve draining was key to manipulating gas prices to have taking points for US midterms and inflation calculations, for starters. Manufacturing numbers are also down https://www.zerohedge.com/economics/ism-manufacturing-contracts-2nd-month-prices-paid-new-orders-plunge https://www.zerohedge.com/economics/ism-manufacturing-contra...
- WastingMyTime89 4y ago
  The PMI is not a manufacturing indicator. It’s a diffusion index on the value of stocks. What you are saying is that the stock market is contracting after seeing a rise at the beginning of the year (also zerohedge, come on, I thought we were having a serious discussion here).

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bayindirh 4y ago

The biggest companies have some very strong analysis departments which warn them about these kinds of possible scenarios (recession, etc.), and the companies act with this information. There were already signs of a global economic recession elsewhere (Asia, Europe to a lesser extent), with different signs (food and energy prices, even before the war). So the companies started to take defensive action before the downturn became visible on their side of the pond. Now it's looming at the horizon, not like the dotcom bubble or the previous recession(s). I guess it'll be slower, hence it'll be longer and will cut slow and deep.

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twistedpair 4y ago

"recession" talk provides cloud cover for many a company to pare back and prune products, processes, and people in a way that would normally cause more out cry. It's not that such changes aren't needed, but they can pile up until a forcing function triggers a hard look and it's acceptable to do them.

thrwawy74 4y ago

I'm convinced industry captains are given stronger indicators from the government that a recession is happening. Yes, they have amazing advisors that could feel this out naturally. I also think senators and representatives tell them directly to prepare before the average consumer gives this forethought. It's in the government's best interest to support those with capital. All the rest of us be damned.

SantalBlush 4y ago
Maybe. But it's important to bear in mind that when a CEO tells the public something, their goal is to manipulate the public in a way that is beneficial to their company. They might happen to be telling the truth, but that's incidental. So when Jeff Bezos says, "Batten down the hatches," he's not actually saying it to prepare us for recession.
- thrwawy74 4y ago
  Clearly he is selling us hatches :x

pissedgenes 4y ago

I'd still bet we avoid a recession in the US, even if certain industries (like tech) contract sharply. It's easy to forget tech is not the economy at large. What I think most people would classify as tech jobs — working in “internet publishing and broadcasting and web search portals” — are less than 0.3% of total payrolls employment. But tech makes up ~26% of the S&P 500 market cap, so tech gets a lot more media attention because the companies are so valuable. Layoffs are terrible for anyone involved. But even with the roughly 200K layoffs at public and startup tech firms in 2022 and 2023 so far, that's .001% of total US payroll employment.

BurningFrog 4y ago

The Fed has been raising interest rates at historically fast rates all year in order to fight inflation by cooling down the economy. Which is another way of saying "inducing a recession", as any educated person should know.

remote_phone 4y ago

I was in the “global recession” camp all last year but I’ve started to doubt that. I don’t see any real economic impact to companies except Meta but that was them losing market share. Otherwise all these layoffs feel like hangover recovery from over hiring the last 3 years. I think we will be fine. Hiring won’t be like the last 3 years but I also don’t think we are going to go through the Bust 2.0.

UncleMeat 4y ago

So like, lay people off when there is actually a global recession then. Jesus Christ. Revenues and profit are still up, especially at Google.