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Saturday, September 17, 2022
The recession the media ignores
GDP by year.
We are in the 9th month of a recession that is unusual in that few in the media dare to call it a recession.
The media feigns ignorance. The only time the R word appears is when the business news media says we could fall into a recession.
CNBC said in July, “U.S. recession looks likely — and there are 3 ways the economy could get hit, analyst says.”
Forbes said in July, “U.S. Will Fall Into Recession This Year As ‘Worrisome’ Forces Grow, Bank Of America Warns.”
We already were in a recession, which is defined as six consecutive months of a contraction of the economy.
Now the media is redefining it as a contraction of nine months — or more.
CFO Dive said in August, “The U.S. economy probably will not grow this quarter and, after more weakening, may fall into a brief recession by early next year, the Conference Board said Thursday, citing its Leading Economic Index.”
So even after three quarters of contraction, the media will not call it a recession.
How different it was when President Trump was president. The National Bureau of Economic Research couldn’t wait to declare a recession after only five months.
Usually NBER — called by the press the official arbiter of recessions — waits a year before making such a pronouncement. The press claims it is nonpartisan and non-government, but it receives federal funding and is based in Cambridge, Massachusetts. It will wait until well after the midterm elections to state the obvious.
Bloomberg won’t state the obvious.
The sorta news agency said today, “It’s hard to categorize the US economy these days. Inflation remains quite high, retail sales are moderating but unemployment is at historic lows. The Federal Reserve is stuck navigating these crosscurrents as it attempts to squeeze demand while avoiding recession.
“Indeed, policymakers are poised for another aggressive hike next week, and where the tightening will end is anyone’s guess. Bridgewater’s Ray Dalio argues inflation may eventually force rates into the 4.5%-6% range, and with that trigger a 20% plunge in equity prices.
“The Fed’s moves have been reverberating the world over, with officials in Asia pushing back against a surging dollar in a bid to stem losses to their currencies. FedEx flagged weakness in Asia and challenges in Europe as it pulled its prior outlook on worsening business conditions—a dark sign for the global economy.”
Avoid a recession?
As Madge the Manicurist said 41 years ago, “You’re soaking in it.”
Equity prices already fell about 20% this year. It is a bull market and I am waiting it out. The last one in March 2020 cut prices in half but I trusted Trump and waited it out. Less than six months later, it rebounded — the quickest recovery ever.
I do not see a recovery this year. Likely stocks will dip another 10%. I am not going to point fingers because I don’t have to.
To find out what is going on, you have to go outside Corporate Media which serves the fascist Democrat Party.
Maurie Backman reported, “JPMorgan CEO Warns U.S. Is Headed Toward Something Worse Than a Recession.”
That would be Jaime Dimon. He still denies that we are in a recession but he says there is a 20% to 30% chance of something worse — after the election.
The something worse is double-digit inflation. We have too much money chasing too few goods. You can blame the recession on supply-chain problems caused by locking down the economy over covid.
But inflation? Biden owns that. He tried to buy prosperity by flooding the market with trillions of dollars. Now the Fed must shut off the spigot by raising interest rates.
Larry Summers, Clinton’s treasury secretary, said, raise rates high and quickly and we will return to normal sooner.
He said, “History records many, many instances when policy adjustments to inflation were excessively delayed and there were very substantial costs to that. I am aware of no major example in which the central bank reacted with excessive speed to inflation and a large cost was paid.”
He handled the dot.com bubble bursting with aplomb. Maybe we should listen to him.
Posted by Don Surber at 9/17/2022 03:00:00 PM