Decoding mixed signals on recession

Perception and reality rarely (never?) align perfectly and depending on where you stand, cutbacks in #consumerspending may seem like an overreaction while from a different angle, that behavior may feel rational if not prescient: "In some ways, the #recession debate is semantics. Recession or not,?Americans are clearly hurting right now?because the cost of living is too high. Real wages, adjusted for inflation,?are shrinking.?And although consumer sentiment as measured by the University of Michigan has climbed two months in a row,?it remains near record lows." #consumerbehavior https://lnkd.in/g3PpF56S

None of this means the economy is out of the woods. It isn't.

"This is not a recession. It's not even in the same universe as a recession. It's just patently wrong to say it is." -Mark Zandi, chief economist at Moody's Analytics. What do you think? Are we in a recession? Will we be? My 2c- I don't know. BUT The bond yield curve is still inverted. There have been two consecutive quarters of GDP shrinkage-( the two main ingredients for a recession) and 588,000 new jobs were added in July. (does not happen during a recession) SO Its confusing to say the least. This is a strange time micro and macroeconomically. No one has all of the answers. Maybe is a highly underrated answer. "Reality is nonsimultaneously apprehended." -Buckminster Fuller Source article in the comments...

No need to listen to me here, people, read what an expert had to say: "This is not a recession. It's not even in the same universe as a recession," Zandi told CNN. "It's just patently wrong to say it is." Two back to back quarters of shrinking GDP don't guarantee a recession. That's not to say we are home free, freight rates are still going up, and data from the International Monetary Fund suggests that inflation is directly tied to those rates (link in comments below). There are several other factors also, but what is most important is whether or not the public actually believes that a recession exists. No Recession. Not yet. Let's not think ourselves into one. #recession #jobs #economy2022 https://lnkd.in/gNYEm5_y

Let's get back to #business and stop talking about the (non) #recession. It's time to get back to the business of #customerledgrowth

Perception and reality rarely (never?) align perfectly and depending on where you stand, cutbacks in #consumerspending may seem like an overreaction while from a different angle, that behavior may feel rational if not prescient: "In some ways, the #recession debate is semantics. Recession or not,?Americans are clearly hurting right now?because the cost of living is too high. Real wages, adjusted for inflation,?are shrinking.?And although consumer sentiment as measured by the University of Michigan has climbed two months in a row,?it remains near record lows." #consumerbehavior https://lnkd.in/g3PpF56S

Talked to Mark Zandi about the state of the US consumer and economy last night on Fast Money. https://lnkd.in/etP8J6gW

Are we in a recession? Depends on who you ask. That's pretty confusing, right? Let's discuss. The most common definition of a recession is two consecutive quarters of negative growth. The economy met that bar after the most recent report on Gross Domestic Product, which showed that the economy shrank in the first half of 2022. If it looks like a duck and quacks like a duck...isn't it a recession? Not so fast. We won't know whether we're actually in a recession for several more months. Why? Well, the official arbiter of recessions is the National Bureau of Economic Research (NBER) and their recession criteria depend on a lot more data than just GDP. To formally declare a recession, the NBER looks for a significant and widespread decline in economic activity that goes on for a while. We may very well be in a recession. However, a mixed bag of positive and negative economic factors make it weird and hazy. >On the positive side: the labor market remains strong, still creating plenty of new jobs. Consumer and business investment is also still looking sturdy. >On the negative side: inflation is obviously on everyone's radar, as is the Fed's latest interest rate hike. So, does it ACTUALLY matter whether we’re “officially” in a recession or not? That also depends on who you ask. There’s definitely symbolic value in knowing that we’re in a recession. Policymaking economists are pretty wary of prematurely announcing one. The possible result of panicked markets, businesses, and consumers could make it a self-fulfilling prophecy. A number of Wall Street economists think that we may not be in a recession right now; however, many have sounded the alarm that a downturn may be on the horizon. Bottom line: The reality of what we’re experiencing is more important than official recession calls and it's definitely not looking rosy. What does all this mean for you? Whether we're officially in a recession or not, the economy is flashing some undeniable warning signs. Despite recent gains, we can probably expect more market volatility and selling pressure. The good news? This isn’t a surprise to anyone. Right now, the best we can do is stick to the strategy, take advantage of the opportunities we see, and mentally prepare for a rocky road ahead. #investment #economy #opportunities

It’s probably premature to claim that today’s U.S. jobs data pull a nail in the debate over recession fears — workers who were added to payrolls in July mostly reflect business budgeting, recruiting, and hiring decisions made over March, April, May and June. So as much as we like to think the BLS jobs data as a real-time pulse on the economy, there’s unavoidably some inertia baked in there.? But today’s data does raise questions about layoffs announced in recent weeks. It’s possible that those layoffs reflect the foresight of business leaders getting ahead of macroeconomic conditions that have yet to fully materialize, but it’s also possible that they reflect some degree of strategic instrumentalization of macroeconomic conditions as a scapegoat for a lack of foresight over the past year.

So maybe that "recession" talk was a tad premature. Still a blazing hot labor market!