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We'll be stuck in this recession for years, economists say

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Re: We'll be stuck in this recession for years, economists say

#181

Post by Rury »

maerF0x0 wrote: post #131
danhak wrote: post #115

Earlier quoted context omitted.

> Is the market worth more now in Yen, Indian Rupees etc? Or are people just willing to part with more USD (that asset specifically) for the underlying asset (the stock)? Those are...pretty easy questions to answer. The dollar is down about 10% since its March high compared to a basket of other major currencies: https://www.marketwatch.com/investing/index/dxy

Can you help me figure out the maths on that. So how much of the stock gain is from currency devaluation (against other currencies) and how much is due to appreciation (of investors willing to pay more real value) ? Say .INX was 3250 in Jan and is 3500 now. -> 7.7% increase. But currency has lost about 10% of its underlying value. If something loses 1/10th of it's value we expect people to pay 11% (1/.9) more of that…

Currency devaluation doesn't just happen against other currencies. It also happens against particular goods/assets (another currency is just another good/asset). If I have $10 and 10 goods, and suddenly have $1000 and still 10 goods, each good should come to cost 100x more. Or to say it backwards, the $ becomes worth 100x less...

To bring CPI into this, the reason we don't see common inflation metrics such as food/gasoline spike, whereas assets suck as stocks do, is more a matter of supply/demand for the corresponding goods than anything else.

Said differently: if food was the only good there was, and we suddenly doubled the money supply, food would in time come to cost double.

However the market consists of many more things than what CPI looks at (which is why it's a bad measure of inflation). Stocks being one of such things. Real estate another. Right now, demand for stocks is higher than demand for food, and given the more money available, naturally we see stock prices rise, but food/gas prices staying relatively the same...

Re: We'll be stuck in this recession for years, economists say

#182

Post by nradov »

jamie_ca wrote: post #175
chrisco255 wrote: post #155

Earlier quoted context omitted.

Not at all. Sweden never wore masks and never shut down schools and yet they achieved comparable results to draconian lockdowns. They already have herd immunity. It's likely we would get 2 economists from the year 2100 both giving opposite reasons for the next 80 years of events.

Sweden's got 10m people, and 87k cases as of mid-Aug. That's less than 1%, so claiming "herd immunity" is BS. They also have almost 6k deaths. Analysis from a month ago projects Sweden's GDP falling 4.8% in 2020, and eyes a 3.6% growth in 2021 - overall down 1.4% across both years. Denmark's got a little over half the population, 1/5 the cases, 1/9 the deaths. Projected GDP is down 5.1% this year, up 4.0% next year,…

We don't know the real herd immunity threshold. It had been previously estimated at about 70%. However daily average deaths in Sweden are now down near zero even though there are minimal pandemic control measures, and seroprevalence studies have indicated an exposure rate probably below 20%. So what accounts for the current situation?

https://www.worldometers.info/coronavirus/country/sweden/

Re: We'll be stuck in this recession for years, economists say

#183

Post by nradov »

TheCowboy wrote: post #154
127 wrote: post #119

Earlier quoted context omitted.

Economists are a priest class that enables the ruling class to make stupid and short sighted decisions.

Many weren't on board with the tax cut bill that passed under the current administration. http://www.igmchicago.org/surveys/tax-reform-2/

Yes for any given tax policy proposal you can always find one economist who supports it and another who opposes it. Does that tell us anything useful?

Re: We'll be stuck in this recession for years, economists say

#184

Post by nradov »

nonford150 wrote: post #89
icedchai wrote: post #46

Earlier quoted context omitted.

They're pointing out the obvious. Do you think tons of people are going to start dining out again? Going to gyms? Going to the movies? Large parts of the economy will be soft for years. Much of it will never come back due to semi-permanent shifts in behavior.

And maybe we'll start to realize our 'robust' economy was based on so many frivolous activities instead of durable manufacturing and private home ownership.

It's the frivolous activities that make life worth living.

Re: We'll be stuck in this recession for years, economists say

#185

Post by rasz »

just-juan-post wrote: post #66
Guzba wrote: post #11

Economists are as effective as astrologists at predicting the future. For some reason otherwise smart people don't realize this? I think it's something about economists being associated with the university system. I see this assured economic doom repeated so much without being questioned as anything but guaranteed I wonder where this incredible confidence is coming from? We have literally no idea what 2021 holds for…

I would suggest you pay attention to the economic stories and not the human interest stories when it comes to this virus. Did you know that 50% of San Fransisco's stores have closed? Half. HALF. https://www.sfgate.com/business/article/Half-of-all-San-Fran... Did you know 250,000 evictions are looming in Las Vegas alone? https://www.ktnv.com/news/coronavirus/las-vegas-could-face-e... These are very real threats - not…

Sure, 'some' of the stores closed, but store rent didnt even budge. Then we have this https://www.cnbc.com/2020/08/21/july-home-sales-spike-a-reco... home prices _and_ sales up.

Re: We'll be stuck in this recession for years, economists say

#186

Post by joshuaheard »

tsimionescu wrote: post #118
joshuaheard wrote: post #70

We aren't "stuck" in a recession. It is entirely man-made. In the past, a recession was significant because it was a market indicator. Now, however, this recession is artificial, so it does not indicate any market defects. I believe we will have a V-shaped recovery and we will get back to normal soon. In a market-based recession, the fear is how to get back to normal. In this artificial recession, there is no fear, w…

If we get rid of all of the lockdowns, and force people to act as if everything is normal (they won't) how will we handle the millions of people dying?

I'm not arguing we should not lock down. I'm saying, we can lift the lockdowns anytime we choose, and we have removed the economic defect.

Re: We'll be stuck in this recession for years, economists say

#188

Post by juniper_strong »

TheCowboy wrote: post #92

The grandstanding against economists is disappointing. Let's say you were driving at night with someone in the country, and because they either knew the road or could see farther ahead they said, "There's a boulder in a road ahead, we're likely going to hit it if you don't slow down and turn to avoid it." And you do slow down and it allows you to turn to avoid a crash. How do you respond? Mock them for always being w…

I don't think your analogy is a correct one.

Here's something from 538:

"A 2018 study conducted by Loungani and others looked at 153 recessions in 63 countries between 1992 and 2014 and found that the vast majority were missed by economists in both the public and private sector. This was painfully true in the case of the global financial crisis in 2008, which wasn’t officially declared a recession until it had been going for almost a year."

Economists apparently can't predict the future. And they don't seem to be able to "predict" the present, or the recent past.

So I guess in your analogy, it would be something like, "We were driving at night with an economist in the country, and they said, 'There are no boulders ahead that I can see'", and then you hit a boulder, car was totalled, you were severely injured, spent months in recovery, and then 9 months later the economist gets back to you with, "Recent data confirms that we did, indeed, hit a boulder."

I think your argument is an argument from authority. If you can't "predict" the past, you are not an authority.

Re: We'll be stuck in this recession for years, economists say

#189

Post by lostmsu »

AnimalMuppet wrote: post #172
lostmsu wrote: post #143

Earlier quoted context omitted.

You need to look at per capita numbers.

Yes, and? thisisliff said what the per-capita numbers said; do you dispute them?

According to https://www.worldometers.info/coronavirus/ per-1M total cases in US: 18k; in Spain (highest of EU large countries): 9k. About 2x difference not in US favor.

Re: We'll be stuck in this recession for years, economists say

#190

Post by cipher_system »

jamie_ca wrote: post #175
chrisco255 wrote: post #155

Earlier quoted context omitted.

Not at all. Sweden never wore masks and never shut down schools and yet they achieved comparable results to draconian lockdowns. They already have herd immunity. It's likely we would get 2 economists from the year 2100 both giving opposite reasons for the next 80 years of events.

Sweden's got 10m people, and 87k cases as of mid-Aug. That's less than 1%, so claiming "herd immunity" is BS. They also have almost 6k deaths. Analysis from a month ago projects Sweden's GDP falling 4.8% in 2020, and eyes a 3.6% growth in 2021 - overall down 1.4% across both years. Denmark's got a little over half the population, 1/5 the cases, 1/9 the deaths. Projected GDP is down 5.1% this year, up 4.0% next year,…

The 87k are the verified cases, there are a magnitude more cases. So there is some herd immunity in some areas which may with the current or possibly a bit more lax precautions be enough to keep the new cases at a fairly low level in the fall and winter. Still of course no full herd immunity in all areas.

Some epidemiologist say that we'll live with this virus for 30 years and that pretty much everyone will get it sooner or later. If that is the case some countries have only postponed the inevitable.

Or vaccines or better treatments will soon be available and distributed to a couple of billion people, in that case the harder lockdowns saved some lives or months/years of living.

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