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U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

bloomberg.com

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Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#361

Post by noarchy »

qppo wrote: post #325
Server6 wrote: post #309

Earlier quoted context omitted.

It's because of the long term 72-84 month loans. People are trading in used cars for close to the loan payoff amounts - which is still pretty high.

GM had 0% interest for 84 month loans on their trucks for awhile there. something is very wrong with the lending market when it makes sense to give people free money.

The dealerships are making their money with various add-on packages now, to try to bump up the sale price. It isn't even in your favour to offer cash in most cases.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#362

Post by klmadfejno »

mrb wrote: post #247
klmadfejno wrote: post #169

Earlier quoted context omitted.

> I don't need to explain what a 10-20% death rate would do to society, however. Not much if 80% of them are very old and sick.

If 20% die but 8 out of 10 are very old and sick, then globally 4% die who are healthy or not very old. 4% of an (healthy not very old) population dying still means overall the economy would contract by 4% (because product/service demand is down 4%), which would still be the greatest recession in the last 8 decades. Your comment ("not much") is thus completely false.

Sure, but the idea that this virus kills 20% of all people is stupid. You just made that number up. We don't have much we can do to treat this disease. Nobody believes it would ever go that high. If somehow it does, even more than 80% will be old and sick.

4% of a population dying also does not mean the economy contracts by 4%. You just... made that up too.

Lastly, you've assumed that a 4% annualized economy contraction from one month in a quarter means that we'll see 4% by just keeping this going. That's... wrong. The negative impact of lockdowns will compound. I don't give a shit if the economy shrinks by 4%. It's absolutely fine if we have a bit of a shitty economic time. Prolonged wide scale poverty for millions of people is an entirely different beast.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#363

Post by MattGaiser »

grey-area wrote: post #213
MattGaiser wrote: post #148

Earlier quoted context omitted.

> Ive counted 2 furniture stores, a consignment shop, a few barber shops, and half the god damn bars Retail like that is very underrepresented in the stock market, so those losses wouldn't be reflected.

But many people invest in commercial real estate directly or indirectly, and all those travel/retail industry companies were advertising customers for google/fb, and their unemployed workers are customers for Apple and Amazon who now have no money. That the stock market doesn't reflect main street yet after the biggest stimulus in history is perhaps unsurprising but also a little worrying.

You also have to consider that the stock market will probably represent a larger portion of the economy after all this, so while there may be less overall pie, if the companies on the index increase their percent of the pie, it may balance out.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#364

Post by fullshark »

MattGaiser wrote: post #148
nimbius wrote: post #98

This is anecdotal and it might come across as bitter and tonedeaf as someone who is not in a STEM job and cant see the bigger picture very well. Im a diesel engine tech who repairs those big trucks carrying food and shit tickets to grocery stores. the fact that ANY market is completely detached from whats actually happening to Americans is frustrating. My job just cut benefits and hours but we're "essential." Remembe…

> Ive counted 2 furniture stores, a consignment shop, a few barber shops, and half the god damn bars Retail like that is very underrepresented in the stock market, so those losses wouldn't be reflected.

Also they are competing for market share with companies on the stock exchange. The sad truth is a shutdown like this is terrible for small businesses that are going to die, but great for large corporations that can weather the short term pain.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#365

Post by bjustin »

School-Cotton wrote: post #160
res0nat0r wrote: post #120

Earlier quoted context omitted.

I understand their thinking because not working is causing a massive amount of collateral damage, but the virus doesn't care about any of that. If everyone goes back to normal too early, this all just starts over, and folks are forced to be inside even longer, there's just no way around it.

This is wrong. We are not forced to be inside because of the virus. It would have been totally possible to have this pandemic going on with zero lockdowns, which would have probably led to worse health effects, and less-bad economic effects. It's a pet peeve of mine when people claim that we must lock down or that the virus is forcing us to do this or that, as opposed to it being a political choice based on tradeoffs…

Even if widespread shelter-in-place orders were not in effect, if the virus spread through a lot of the people in a town, you can bet that people wouldn't be going out as usual. Nobody* will be eating at restaurants if they hear dozens of people in town got sick while eating out and died because local hospitals are over capacity.

*there's always somebody

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#366

Post by drcode »

icelancer wrote: post #328
drcode wrote: post #254

Earlier quoted context omitted.

I felt like the biggest dolt that I didn't sell my stocks en masse a couple of weeks before the plunge, when it was already obvious C19 was going to be a big deal. I reasoned "The Fed will just inflate the currency to maintain stock prices anyway, so why would I want to go long on the dollar?" Now a month later, my initial instincts don't seem so wrong anymore: My portfolio is doing fine... All I missed out on was a…

There was also biflation in the market, as many people have somewhat alluded to - tech stocks and specific sectors have exploded while others have collapsed. There has been a significant redistribution of alpha even if the total losses came in under what they expected.

"biflation" now there's a term I need to add to my vocabulary.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#367

Post by cs702 »

SpicyLemonZest wrote: post #44
cs702 wrote: post #3

Given that that Jan and Feb seemed largely fine, the rate of decline in March was probably around 3x the quarter's headline figure -- call it -15%, give or take. April was much worse, without a doubt. Anything between a -25% and -50% GDP decline seems possible for April.

Annualized numbers can always be a bit misleading, but applying them to individual months starts to get silly. What's the annualized GDP decline of weekends?

Of course. My point is that the figure for the quarter understates the economic shock in March.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#368

Post by CodeMage »

s5300 wrote: post #311
CodeMage wrote: post #231

Earlier quoted context omitted.

>The bar (which is already dismally low) will have to be lowered further for them to graduate, and how/when will it ever be raised back again? You don't have to lower the bar. There are other options. There is no fundamental law of physics that says a generation has to graduate at age X, so we -- the society -- should be perfectly able to delay that process for a year, instead of lowering the bar. That said, there's…

Hahaha... delay that process for a year... Poster, you're so out of touch. So far. You have no idea of these kids home lives. Heads up: they give zero fucks about government mandated school education.

Please, let's not assume things we don't know about each other. Whether I've known kids like that is something you have no idea about, along with where I've lived, who I've gone to school with, etc.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#369

Post by eppp »

slfnflctd wrote: post #323
eppp wrote: post #268

Earlier quoted context omitted.

The used car market has been inflated for years. 100k+ mile vehicles selling for over half their new price makes no sense to me.

It makes sense if the car tends to last 350k+ miles and has only been gently used. There are at least a few models that have pretty consistently been getting up to that or higher before major repair is needed since 2010 or so. I will say I think quality hybrids (again, gently used) are worth more than a lot of their counterparts on this point.

Gently used at 100k seems like a strong ask. I commute two hours a day and get around ~20k miles a year. The car would be five years old at the point of 100k. Quicker than that and the person that owned it drove the crap out of it. Plastic and trim is squeaking, stains, scratches, etc. I dont personally care about any of that but I expect it to be reflected heavily in the price.

Then you look at the asking prices for larger SUVs with 200k+ miles and its even crazier.

Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession

#370

Post by abhiyerra »

amyjess wrote: post #296
aphextron wrote: post #145

Earlier quoted context omitted.

> No school means poor kids roam the street like packs of feral dogs asking for money for food around here. I think this is possibly the single biggest long term problem we're going to face as a result of all this. Economic recessions will come and go. But missing 5/8ths of a school year is going to be absolutely devastating for this generation of kids. They will be left permanently behind without a serious concerted…

When I was in third grade, we spent half the second semester learning about different kinds of whales. This is material I forgot pretty much as soon as it was over. When I graduated high school, my mom and I went through all my old elementary school material to see what we'd like to keep for sentimental value and what we're okay with throwing out to make room in the garage, and we were just overwhelmed by the sheer m…

I took a bunch of communication college classes while I was in high school. High school and K-12 are essentially glorifies day care and much less about the education. I was learning a lot faster with the condensed college classes than the high school classes which dragged on for the whole year.
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