The Most ‘Obvious’ Recession In History

The Most ‘Obvious’ Recession In History

"Obviously unsustainable." That's how one market participants described the dynamic whereby purported savings "buffers" and "excess" cash built over the pandemic support consumer spending and prevent the US economy from sliding into recession. Initially (where that means last year), I was sympathetic to that thesis, but it became harder and harder to countenance as inflation rose and consumption habits shifted to account for the soaring cost of necessities. As detailed in "The Sad, Sad Story O
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9 thoughts on “The Most ‘Obvious’ Recession In History

  1. I’m very intrigued to hear how the Fed and the administration spin the narrative if/when we find the US in a confirmed technical recession in the near future. I was out at a local restaurant last night, nothing fancy, frequented mostly by tourists and upper middle class locals, I overheard two separate conversations commenting on how shocked folks were after looking at their 401ks, recessions have a psychological element to them, it feels like we are already in one and things keep deteriorating, news cycles will exacerbate this feeling of despair and doom. Dems will get wiped out in November and the Fed will pivot, but they’ll probably be too late to act again.

  2. I drove up and down the entire west coast last week… lots of traffic, people pulling boats/campers, freight trucks everywhere, motels booked, restaurants busy with long lines.

    1. You should do this again in 6 months – say at Christmas time – and again next June. And we’ll see if you can discern any change in your impressions of the economy at large. If you can’t I’d say we survived the recession.

  3. H-Man, took the grand kids (15 and 17) on the annual pilgrimage to the Orlando parks. A hot dog ( boiled not roasted) cost $13, toss in water at $3.75 and your spending a fortune on pablum, This madness can’t last.

  4. This post reminds me of a series of posts that Ben Hunt at Epsilon Theory (h/t to The Heisenberg Report for turning me onto that a while back) has written about the importance of common knowledge — “common knowledge is something that we all believe everyone else believes.” It’s an essential concept in managing the expectations-driven game that seems to define Wall Street of late, and can often derail all but the best-laid and most-disciplined investment approaches.

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