Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

bloomberg.com

Post reply on HN
Print view View original

511–520 of 877 posts

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

#511

Post by IkmoIkmo »

It's pretty insane that the S&P500 is higher than it was during October last year, hell even something like 7% higher than it was last year May. There was a post on reddit joking about a guy going into a coma last year after having purchased a share of an S&P500 ETF, waking up today and hearing the news of a global pandemic, people were told to quarantine at home for more than a month, a quarter million people died, more deaths in the US than 20 years in the Vietnam war, unemployment at 20%. But when he looks at his stock account, it's in the green.

It feels like this is trickle-down economics again. Bail-out large companies by issuing cheap money, stock markets stay pumped, big companies don't go bankrupt, and hope employees don't get fired, and give each individual about 1 week of average income in the US as a little boost.

Meanwhile, 20% of people have last their jobs, the $1200 hasn't arrived or was already spent.

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

#512

Post by _-david-_ »

Tistron wrote: post #157
cpursley wrote: post #121

Earlier quoted context omitted.

[flagged]

In Scandinavia we've had some sort of pragmatic market socialism, not much central planning but reasonable redistribution in various ways. Seems to work fairly well, although large parts of it has been (and is being) dismantled by the liberals (those are the right here, not the left).

To call it socialism is incorrect.

Carl Bildt (former Prime Minister of Sweeden) said "Bernie Sanders was lucky to be able to get to the Soviet Union in 1988 and praise all its stunning socialist achievements before the entire system and empire collapsed under the weight of its own spectacular failures." [0]

Lars Løkke Rasmussen (former Prime Minister of Denmark) said "I know that some people in the US associate the Nordic model with some sort of socialism. Therefore I would like to make one thing clear. Denmark is far from a socialist planned economy. Denmark is a market economy" [1]

Seems like they both reject the idea of them being socialist countries. They are both non-socialist countries that have market economies. They just happen to have a larger welfare state than a lot of countries. Having a large welfare state has nothing to do with socialism though.

[0] https://twitter.com/carlbildt/status/1100039769810235393 [1] https://www.thelocal.dk/20151101/danish-pm-in-us-denmark-is-...

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

#513

Post by misiti3780 »

RankingMember wrote: post #151
dudul wrote: post #112

Earlier quoted context omitted.

And this post is why I get so infuriated when I see all the blue-checkmarks on Twitter, calling people who want to go back to work "Selfish, stupid, idiot, etc". People don't want lockdown to stop because they need to go to their hairdresser, or because they need to go hangout at the pub, or whatever idiotic reason these privilege a-holes put in their tweets. People want to get back to work , because they need money…

The essential motivation for people to want to feed their families/pay bills is completely logical, but it's important to keep in perspective that the virus doesn't care about any of these things. We don't need to look too far back in history to see that ending isolation in a pandemic too early can have huge consequences (much bigger than an economic slowdown/unemployment).

One piece of anecdotal evidence:

I live in NYC but currently reside in rural upstate NY. We have very few cases up here and it's impossible to NOT socially distance because that the way of life up here.

As of last week, Cuomo is applying the same rules in NYC to all of NY state, which is ridiculous. My family friend has a furniture factory up here that employs 220 people with a backlog of $2M+ pieces worth of furniture. All of his employees were socially distancing before and everyone had an N95 because of what they were building. Cuomo shut down the state and this guys business is about to go under (competition is legally opening up in Ohio and other states) because he's weekly payroll is 125 and at some point he doesn't want to risk $500-1MM of his own money out of pocket to weather the storm. That is 220 jobs that do not need to disappear.

The same rules that apply to NYC should apply to other areas. Some of these problems were are seeing are policy problems.

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

#514

Post by snarf21 »

hn_throwaway_99 wrote: post #17
iambateman wrote: post #4

I understand that the economy and the market are different but I'm so confused. The S&P is up ~12% this month, despite massive unemployment, a shrinking economy, and serious long-term questions about the outlook. Is most of the 12% just market speculation that the virus issue will pass without a long-term earnings hit?

3 things: 1. People keep saying about the market being up recently, but skip the part about it still being down about 10% since the start of the year. 2. S&P is heavily weighted towards the strongest companies. Amazon, Apple, Facebook, Microsoft and Google account for 20% of S&P market cap. Most of those companies have been helped by the pandemic, or at least not hurt nearly as bad as smaller companies. 3. The market…

I agree and there is one other thing. Interest rates are 0 you can try to sit on cash but with the increase in money into the system, that is a loser long term. The Fed is buying things to keep prices up. There are trillions that have to go somewhere. Asset prices continue to propped up and people and funds are chasing returns.

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

#515

Post by lleolin »

at-fates-hands wrote: post #438
thescriptkiddie wrote: post #394

Earlier quoted context omitted.

Only 52% of americans own any stock whatsoever [0], and the richest 10% of americans own 84% of all stock. [0] https://news.gallup.com/poll/190883/half-americans-own-stock... [1] https://www.nber.org/papers/w24085

> and the richest 10% of americans own 84% of all stock. The top 20% of earners also handle close to 90% of the tax burden, while close to 50% of the population pay nothing in taxes.

In that case, I would love to be handling 90% of the tax burden right now.

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

#516

Post by cactus2093 »

_bxg1 wrote: post #381
mcphilip wrote: post #138

Earlier quoted context omitted.

> 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. Thanks for posting this comment. I know it sounds trite, but I’…

> My question is how much, if any, social unrest this will lead to. There is deep rot at the heart of the American system, and something is going to have to give. The economy has been broken for the lower 50% for a long time now. This course is unsustainable. I try not to get explicitly political on here, but Bernie Sanders was, as far as I can see, our last shot at reversing the trend from within the current system.…

I mostly agree with what you're saying, but disagree about Bernie. Many of his biggest policies are still just trying to cover the rot with a coat of paint. Healthcare too expensive? Just have the government cover the bill. College too expensive? Same thing. Workers not paid enough? Raise the minimum wage. All very blunt, simplistic reactions, that ignore the complexities of the real world. Getting rid of the rot requires looking at the roots of the problems. If something is 10x more expensive today than it was a few decades ago, just agreeing to pay the 10x price is not a good solution. You need to figure out and address the underlying causes.

I am still hopeful for our future, maybe foolishly, but I am. If there is a silver lining of Covid-19, maybe it will highlight some of the insane bureaucracy and regulatory capture that are strangling our institutions in the US and lead to improvements. Don't get me wrong, we also need some progressive policies targeted at helping those who are struggling most, but those policies will only be effective if we also recognize and address the underlying cost disease issues. Just look at progressive havens like San Francisco to see how much money can be burned on well-intentioned ideas without achieving any results, if you refuse to acknowledge the underlying causes.

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

#517

Post by karatestomp »

fennecfoxen wrote: post #258
ghaff wrote: post #175

Earlier quoted context omitted.

There was some discussion of aspects of this yesterday and there have been a few articles. The general consensus is that kids who have good home environments and have at least some interest in learning will mostly do fine. Some may even do better than normal. But kids in poor home situations who were already barely scraping by--if that--will basically lose the year and everything that implies. In some areas, double-d…

What does it imply? If any school district cares, all the kids will essentially end up repeating a grade. This is not the end of the world. If anything, it might improve student achievement. (Students who are born right after the cutoff for a particular elementary school class, in aggregate, outperform the ones born just before, the youngest in the class.) Outside of college-bound seniors — a special case — the main…

1) there's no way parents will be OK with this, and

2) the count of districts ready to have a 7.7% student headcount increase in one year (you're doing this for 13 grades at once, plus have another coming in) on top of whatever growth they already expected approaches zero. I mean, hell, think of what that would do to the teacher labor market alone if even 10% of districts all did that, putting aside things like building space and bussing.

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

#518

Post by coldpie »

lisper wrote: post #501
ironmagma wrote: post #395

Earlier quoted context omitted.

On top of that, an even greater fraction of people who believe that the administration is incompetent, believe the correct solution to that predicament is to vote the opposite party come election time. It’s as if change in the election system isn’t even an option.

You have to pick your battles. Changing the election system is really hard. There are legitimate policy disagreements one can have with the Democrats, but one thing you cannot say about them is that they are brazenly corrupt and hostile to facts. Donald Trump is both. He is proud of these things. He thinks they're features, not bugs, and about 40% of American voters seem to agree. As long as that remains the case, no…

This is true, but it's important to note that it applies to Republicans generally. Trump isn't special. He is the results of decades of Republican policy and is supported by Republicans even to this day.

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

#519

Post by jhallenworld »

basch wrote: post #372
jhallenworld wrote: post #142

Earlier quoted context omitted.

To add to this: even within the S&P-500, the better ones seem to do much better than the average ones, so the NASDAQ-100 outperforms the S&P-500. As an investor: Very happy with my "QQQ" (NASDAQ-100 ETF) investment, but my more diverse retirement portfolio is nowhere near as good. I have recently been buying hard hit stocks that I think will survive over the long term: Disney, Marriott.. As an employee: well, the tri…

QQQ was a good growth bet, but so is pure AMZN. 50% of QQQ is FAAAMIN (Facebook, Amazon, Apple, Alphabet, Microsoft, Intel, Netflix, with Cisco right below but they dont fit the acronym.) https://www.portfoliovisualizer.com/backtest-portfolio?s=y&t... Investing in Amazon is almost as profitable as a 3x leveraged parity risk bet on QQQ. I get what you are saying, "buy when people are fearful", but do you really think…

Yeah, this is purely fear- people overshoot on the way down, you can profit. I made some easy money in 2008 on certain banks that were obviously not going to fail. The bet is that things return to some sort of normal. I would not normally buy these stocks, they have nowhere near the growth potential as the tech stocks.

I guess I don't believe in the statistical basis of the risk calculations (bell curve is an invalid model for sure for stocks), so only one stock is way riskier than you would think and tech only is already exposing you to some kinds of systemic risk.

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

#520

Post by lallysingh »

rchaud wrote: post #354
gvhst wrote: post #215

Earlier quoted context omitted.

I missed pretty much the same amount of school during SARS in Hong Kong in 2003. This was before any sort of remote learning was possible, I didn’t do school work for pretty much a whole semester. I didn’t feel that this held me back at all, however there were a few key differences in my end: - I was in 4th grade where school was less rigorous - I went to a private international school - While my parents were busy wo…

If you went to a private intl school, I imagine the tuition wasn't cheap. That right there is the difference. When you're paying big bucks, your parents will want to do everything to make sure you don't fall behind. I assume with that kind of education you also went on to complete a university degree of some kind. Contrast that to the public high school system in the US, where resources are lacking, and students may…

Often times when parents are taking international positions for their firm, the employer will pay for private international school.
Post reply on HN