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I don't think we will face a bad recession, but I think things are going to change over the next few months. There was so much spending happening because of covid stimulus, people saving money because they stayed home, didn't vacation, didn't commute, etc and also people not paying student loans that it sounds like they will have to pay back.
The old joke is economists have correctly predicted 6 of the last 2 recession.
To be little more precise that joke usually goes something like this.........Nouriel Roubini, Peter Schiff, Marc Faber, Robert Gordon, Robert Schiller (insert your favorite gloom and doom economist or fake-economist) has successfully predicted 17 of the last 3 recessions.
Schiller really takes the cake and yes, I know you know this but others don't, he's the Schiller from the Case Schiller Home Price Index fame. Not to be too big of a jerk but here goes........I've made millions and acquired right at 30 sections of land since the last housing bust by doing exactly what Schiller recommends against most of the time.
The problem with pessimists is they are correct some of the time. People and the press latch onto that and never let go.........anyone who has followed Schiller over the last 10/12 years is either broke or way underwater.
I think the joke has a lot of merit for two reasons:
1. Economists, especially academic economists, tend to be a very pessimistic and unhappy crowd generally.
2. Economists who get a lot of camera and mic time and lots of column inches and hits are overwhelmingly gloom and doomers.
3. Bonus...........a guy in Dallas who is not an economist but absolutely sells himself as one has been calling for a DFW-wide housing bust since about 2015. It's really tough to be more wrong than this guy has been. I'm leaving his name out because he is notorious for suing people.
I don't think we will face a bad recession, but I think things are going to change over the next few months. There was so much spending happening because of covid stimulus, people saving money because they stayed home, didn't vacation, didn't commute, etc and also people not paying student loans that it sounds like they will have to pay back.
I was looking at layoff and bankruptcy on https://www.dailyjobcuts.com/,surprised layoffs are picking up.those who lost their jobs may not be able to find comparable jobs paying the same-Goldman Sachs managing directors,school district workers,teachers,newspaper staff,not a big demand for these people.
and that student loan payment in October and the cc debt they have not paid down.
Banks have tightened their credit,it is not as easy t o get an auto loan or asking for higher cc spending limit.
I was looking at layoff and bankruptcy on https://www.dailyjobcuts.com/,surprised layoffs are picking up.those who lost their jobs may not be able to find comparable jobs paying the same-Goldman Sachs managing directors,school district workers,teachers,newspaper staff,not a big demand for these people.
and that student loan payment in October and the cc debt they have not paid down.
Banks have tightened their credit,it is not as easy t o get an auto loan or asking for higher cc spending limit.
I can't believe how much some of those finance/goldman sachs people make. Who knew the title 'fixed income sales' or equity sales could pay so much. Old school boys club all the way in those positions.
I can't believe how much some of those finance/goldman sachs people make. Who knew the title 'fixed income sales' or equity sales could pay so much. Old school boys club all the way in those positions.
Totally wrong.
GS is a great example of old school hardcore results or get out Wall Street.
For talent jobs, that's just about all jobs outside admin., the mailroom, security and captive limo drivers everyone hired is an A++ type. For newbs top of the class at name schools only with a smattering of #1s from maybe Vandy, USC etc. . For mid-career types it's a great education and top performance elsewhere.
Outside covid every year GS literally fires its bottom 5-7% talent in terms of performance and others who don't fit.
If by boy's club you mean just about top of industry performers in just about every position sure. If you mean men get and keep jobs just because they are men and know someone - no.
Well, I'm glad the economists see the baseline case improving. That is good news, but it certainly doesn't mean we're out of the woods.
Economists are good about quantifying guesses with large amounts of imperfect data. The actual academic ones can do a pretty good job if they're not running with a different motive. However, using data like that they are always looking for continuation of trends and current expectations. It's the surprise that always gets us.
So it's understandable in looking out that....I don't see anyting that would necessitate putting us into recession....and I can't predict an anomoly. There may be 100 Black Swan Events that all have a 1% chance of happening...but I'd look foolish to include any one of them in my prediction.
However, what we have to guess at is that interest rates are much higher than they were. Inflation is much higher than it was. Loans are harder to get than they were before. Commercial properties are emptier than they were before. So maybe 40 of those Black Swan events now have a 1.5% chance of happening instead of 1%, but that still isn't enough for inclusion, but at a better economic baseline....things look better on the forecast, yes? Worse, those bad events have a much higher chance of happening if one of the other events does. For example, a store generally is not going to get robbed blind....but the chance of this happening goes up if law and order is lost, which is also an unlikely scenario.....but the chance of this happening goes up if Trump bum rushes the White House with MAGA soldiers and declares himself dictator.
So if we look at where there are domino setups ready to fall, that's where your risk is, right? Evergrande (remember them) finally announced some massive losses. Approximately 1/3 of San Francisco's super expensive offices are sitting vacant. Substantially all college graduates in the past 10 years are about to get hit with a headwind as student loans come back into play.
Economists are great at monitoring the baseline and where it's going.
GS is a great example of old school hardcore results or get out Wall Street.
For talent jobs, that's just about all jobs outside admin., the mailroom, security and captive limo drivers everyone hired is an A++ type. For newbs top of the class at name schools only with a smattering of #1s from maybe Vandy, USC etc. . For mid-career types it's a great education and top performance elsewhere.
Outside covid every year GS literally fires its bottom 5-7% talent in terms of performance and others who don't fit.
If by boy's club you mean just about top of industry performers in just about every position sure. If you mean men get and keep jobs just because they are men and know someone - no.
Maybe GS was a bad example then...but I know these men.
"If You Spend 13 Minutes A Year On Economics, You've Wasted 10 Minutes" - Peter Lynch
As someone that took enough classes in economics to qualify as a economist, that was some of the best education I ever got in my life. Made a huge difference in my life..... well in my retirement since that's when I needed the investments.
Now, reading in the popular press about economics and the "predictions"is a waste of time.
BTW...Peter Lynch was right...about retail stocks. It made him a fortune and he got to retire early.
I can't believe how much some of those finance/goldman sachs people make. Who knew the title 'fixed income sales' or equity sales could pay so much. Old school boys club all the way in those positions.
At every business in America, the top sales people are among the most highly compensated in the company.
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