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by lame-robot-hoax 984 days ago
Under what definition is the US economy in a recession?

People can keep clamoring for it, but the only recession the US is possibly in is a “vibes based” recession.

7 comments

My paycheck has not increased in size relative to increase of prices of necessities. Every dollar going to necessities is a dollar that can't go to discretionary spending.

Lower discretionary spending for a long enough time means growth slows. The prices traders are willing to buy stocks is a function of a company's future growth prospects. Slowing growth rates makes for a recession.

Too many politicos define "strong economy" in terms of unemployment rates because they're simple scalar values. Full employment with high prices doesn't make for an environment where anyone can eke out margins.

IMO People have gotten used to the steady growth of the last 15 years, so no growth feels like contraction.
https://en.m.wikipedia.org/wiki/Recession

https://ycharts.com/indicators/us_recession_probability

Maybe because the current state implies a higher than normal probability of the US being in a recession? Kinda accounts for the vibes.

This is simply a measure of the yield curve, nothing more.
We're only officially in a recession when NBER declares it. And they only do so by looking backwards, months after the fact at least.

The "two quarters of negative growth" was only ever a rule of thumb that mostly fit, never the official definition.

Appeal to authority is a weak argument. We are trying to use reason to figure out what's going on, not close the discussion by saying that we are not the entity that gets to decide such things.
They asked for the definition. That is the definition in the US. Everything else is speculation.
No they asked for a definition that would say the US is in a recession.
Everyone knows no country besides the US has ever experienced a recession, since the NBER didn't declare it. And even for the US, they've only happened since the establishment of the NBER, since they weren't around to declare recessions before they existed and thus there were by definition no recessions. We should just abolish the NBER and thus ensure there will never be another recession.
NBER has declared that the definition of a recession is when NBER has declared a recession. NBER has declared that disagreements with that definition are clearly invalid, since NBER is the source of the official NBER definition of recession.
COVID-19 killed a lot of careers and businesses. The rise in gas and diesel increases the costs of shipping which is passed on to the customers.

Going green will destroy our economy because there is no infrastructure to replace fossil fuels yet.

Perhaps there is a flaw in the measurement of nominal GDP, or in the measurement of the real GDP price deflator
The vibes are off though