{"id":1475758,"date":"2024-07-07T13:20:00","date_gmt":"2024-07-07T17:20:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1475758"},"modified":"2024-07-07T13:20:00","modified_gmt":"2024-07-07T17:20:00","slug":"have-we-been-in-recession-for-years","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/have-we-been-in-recession-for-years\/1475758\/","title":{"rendered":"Have We Been In Recession For Years?"},"content":{"rendered":"

Have We Been In Recession For Years?<\/span><\/p>\n

\n

Via Money Metals<\/a>,<\/em><\/p>\n

Have we already entered recession? Worse, have we been in a recession for years now?<\/strong><\/p>\n

<\/a><\/p>\n

Recently I joined Jeff Tucker<\/a> of the Brownstone<\/a> Institute on an article<\/a> about the Herculean task of trying to figure out what’s actually happening in the economy.<\/p>\n

Which is a challenge given every official economic number out there is broken.<\/p>\n

<\/a><\/p>\n

I\u2019ve covered some of these in recent videos<\/a>, including failing to count homeless people as unemployed, calling welfare spending economic growth, and undercounting inflation \u2014 perhaps by a lot.<\/p>\n

Thing is, if the official numbers are wrong, it could mean we’re already in recession, masked by rising asset prices courtesy of the Fed.<\/strong><\/p>\n

Inflation: the Key to Recession<\/h2>\n

To give a flavor, the official inflation rate since Covid has been around 21%. But fast food menu prices \u2013 a go-to indicator for Foreign exchange investors \u2013 are up between 35% and 50%. People posting grocery receipts online say it’s actually more than 50%.<\/p>\n

The problem is if inflation was actually, say, 35% it means GDP hasn’t gone up at all since pre-Covid. It means it actually went down. Implying we’ve been in recession for nearly 5 years.<\/strong><\/p>\n

<\/a><\/p>\n

This is because official growth numbers are discounted by inflation. If growth was 3% but inflation was 2%, we grew. If inflation was actually 4%, we shrank.<\/p>\n

That means that if inflation was actually worse than 35% \u2014 if, say, it was the 50% that grocery receipts say \u2014 that would put us near Depression levels with a 13% drop in real GDP since pre-Covid.<\/strong><\/p>\n

Are We in a Hidden Depression?<\/h2>\n

The idea seems absurd \u2014 it shocked me. But, historically, inflationary depressions are hard to see for the simple reason that asset prices pump before consumer prices do. The affluent keep spending since their stocks soared and their house prices soared \u2013 sound familiar?<\/p>\n

In Germany’s Weimar hyperinflation, for example, early on people weren’t complaining about prices, they were popping champagne over how much money they were making on their stocks. The hunger came later.<\/p>\n

The 4 year depression theory explains a lot of otherwise mysterious data.<\/strong> My colleague EJ Antoni found that manufacturing orders have been flat for at least 3 years, while consumer spending has actually been negative for those 3 years. We get data points like Americans seeing McDonald’s as a luxury item, buying groceries on credit cards, selling off second cars, down-sizing to smaller homes \u2013 all hallmarks of a recession.<\/p>\n

<\/a><\/p>\n

<\/a><\/p>\n

Even that grandaddy of statistics, GDP, may be an illusion. Because GDP counts government spending as production.<\/p>\n

Which, of course, it is not: it\u2019s spending, not building. So our current $2 trillion deficit is, on paper, automagically boosting GDP by nearly 7%. But the spending isn’t making us richer \u2013 it’s making us poorer as physical resources get squandered.<\/p>\n

It’s the1970s All Over Again, but Worse<\/h2>\n

When the official numbers are lies, we\u2019re left with data points and anecdotes like record credit card debt, financial distress among the middle class, shrinking quality of life.<\/p>\n

<\/a><\/p>\n

My base case has been that we’re repeating the 1970’s disaster driven by out of control government spending and out of control Fed money printing. The official numbers are matching that almost to a tee.<\/p>\n

But if, in fact, the real numbers are much worse \u2013 perhaps even as bad as voters and consumer surveys report \u2013 then we could be headed towards a proper Depression.<\/strong><\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nSun, 07\/07\/2024 – 09:20<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/economics\/have-we-been-recession-years<\/a>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Have We Been In Recession For Years? Via Money Metals, Have we already entered recession? Worse, have we been in a recession for years now?…<\/p>\n","protected":false},"author":0,"featured_media":1475759,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[1],"tags":[],"class_list":["post-1475758","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","wpcat-1-id"],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pbimBl-6bUy","jetpack_featured_media_url":"https:\/\/bugaluu.com\/news\/wp-content\/uploads\/sites\/3\/2024\/07\/have-we-been-in-recession-for-years-social_80-q5WcZe.jpeg","_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1475758","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1475758"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1475758\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media\/1475759"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1475758"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1475758"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1475758"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}