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US economy returned to growth last quarter, expanding 2.6%

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Re: US economy returned to growth last quarter, expanding 2.6%

#191

Post by twblalock »

alexb_ wrote: post #2

>Housing investment, though, plunged at a 26% annual pace, hammered by surging mortgage rates as the Federal Reserve aggressively raises borrowing costs to combat chronic inflation. It was the sixth straight quarterly drop in residential investment. Thank christ. Please bring on a housing crash ASAP.

It would be hard for housing to crash unless the current supply and demand situation changed dramatically.

An increase in supply so large that it would cause prices to crash would take years to build. In fact, inventory is lower than normal in some areas because people who might otherwise sell are holding out for better times, sometimes by renting out their properties and capturing today's unusually high rent prices instead.

A drastic decrease in demand is not going to happen because of mortgage rates. High mortgage rates have already taken a chunk out of demand yet housing has not crashed. The only way I can see demand dropping so much that prices crash is a major recession with mass unemployment, which knocks a large number of potential buyers out of the market entirely because they lost their incomes.

Re: US economy returned to growth last quarter, expanding 2.6%

#192

Post by nightski »

vikingerik wrote: post #136
importantbrian wrote: post #6

This is the weirdest "recession" I can remember. Business leaders are constantly talking about how challenging the economic environment is and the need for layoffs etc. Meanwhile most of the underlying indicators are actually positive. Growth is strong, employment is strong. Anecdotally we're still having trouble finding good candidates. It's almost like there is a class of business leaders who are just trying to wis…

There never was a real recession - it's an artifact of year-over-year numbers that were so skewed from pandemic effects. Pent-up consumer demand shifted much activity from 2020 into 2021. This is the source of all the apparent weirdness. Every yearly number in 2021 looked great thanks to comparing an artificially high number to an artificially low 2020 baseline. Then every yearly number from 2022 looks terrible, beca…

The data just does not seem to line up with your assessment. Labor force participation rate is down 1% since pre-pandemic. It's not earth shattering, but it is quite a drop.

Also inflation is hardly a few percentage points of catch up. Look at the chart below and tell me you still believe that.

https://www.bls.gov/charts/consumer-price-index/consumer-pri...

Not to mention food/gas is worse which is what hits people in low to mid income ranges the most.

Re: US economy returned to growth last quarter, expanding 2.6%

#193

Post by adam_arthur »

yardie wrote: post #124
jandrese wrote: post #66

Earlier quoted context omitted.

Supposedly the car market is about to crash as well. There was supposedly 2008 like shenanigans in the auto lending segment and the crows are coming home to root. Speculation is that people were buying cars they couldn't afford using the stimulus checks as the downpayment and then immediately asking for a halt on payments due to COVID. With both factors no longer in play people can't afford their cars and are default…

Stimulus checks were what $2000 total. That's less than 10% on a new car and most competent banks look at your monthly payment and DTI to determine how much to loan. > A recession is bad for the party in power and a lot of the economic catastrophe drumbeat started around the time early polls opened up. They've moved from economy to gas and the polls are now on crime. Really anything to stir up FUD.

There was over 6T in aid, not even fully counting mortgage or debt pauses/deferrals. Or eviction moratorium

Maybe look at the numbers. What’s obvious today will be even more obvious to historians. You can look it up in 5-10 years if you prefer

Re: US economy returned to growth last quarter, expanding 2.6%

#194

Post by nequo »

christkv wrote: post #179
vikingerik wrote: post #136

Earlier quoted context omitted.

There never was a real recession - it's an artifact of year-over-year numbers that were so skewed from pandemic effects. Pent-up consumer demand shifted much activity from 2020 into 2021. This is the source of all the apparent weirdness. Every yearly number in 2021 looked great thanks to comparing an artificially high number to an artificially low 2020 baseline. Then every yearly number from 2022 looks terrible, beca…

I really hope you are right but the massive debt taken on by all the western countries has me worried about their ability to actually respond to a hard recession if it hits this winter.

Public debt is a strange thing. The gross public debt of the US is 135% of its GDP[1] but Japan has it at 266%[2] and they've done okay so far, too.

[1] https://en.wikipedia.org/wiki/National_debt_of_the_United_St...

[2] https://en.wikipedia.org/wiki/National_debt_of_Japan

Re: US economy returned to growth last quarter, expanding 2.6%

#195

Post by bitcurious »

newfocogi wrote: post #128
rogerkirkness wrote: post #4

Earlier quoted context omitted.

Housing investment would be 'housing starts' as in new houses being built. I doubt that prices will be going down if there are more people and the same number of houses. Part of the market for existing houses is sensitive to mortgages. All this means is housing will actually cost more in the future on a total cost of ownership basis. If you're a renter with a ton of cash, this is good, but for literally all other sta…

Could you explain why this is good for the renter with a ton of cash?

Sticker price for houses will fall, so if you're a cash buyer you get a discount. Monthly prices won't, so if you're a mortgage buyer you're paying more to the bank and less to yourself.

Re: US economy returned to growth last quarter, expanding 2.6%

#196

Post by SkyPuncher »

importantbrian wrote: post #6

This is the weirdest "recession" I can remember. Business leaders are constantly talking about how challenging the economic environment is and the need for layoffs etc. Meanwhile most of the underlying indicators are actually positive. Growth is strong, employment is strong. Anecdotally we're still having trouble finding good candidates. It's almost like there is a class of business leaders who are just trying to wis…

IMO, business leaders knew they over-hired and that it was a wide spread industry trend.

"The Recession" was a convenient reason for them to trim ineffective or unnecessary staff.

Re: US economy returned to growth last quarter, expanding 2.6%

#197

Post by AntiRemoteWork »

rendang wrote: post #24
importantbrian wrote: post #6

This is the weirdest "recession" I can remember. Business leaders are constantly talking about how challenging the economic environment is and the need for layoffs etc. Meanwhile most of the underlying indicators are actually positive. Growth is strong, employment is strong. Anecdotally we're still having trouble finding good candidates. It's almost like there is a class of business leaders who are just trying to wis…

Another piece of the puzzle is the big drop in labor productivity lately - https://fred.stlouisfed.org/series/OPHNFB . Could the data you mention be explained by workers previously being in jobs where they were unproductive, being laid off but then quickly reabsorbed by the hot labor market into more efficient lines of work?

No post body was provided.

Re: US economy returned to growth last quarter, expanding 2.6%

#198

Post by piyh »

yardie wrote: post #124
jandrese wrote: post #66

Earlier quoted context omitted.

Supposedly the car market is about to crash as well. There was supposedly 2008 like shenanigans in the auto lending segment and the crows are coming home to root. Speculation is that people were buying cars they couldn't afford using the stimulus checks as the downpayment and then immediately asking for a halt on payments due to COVID. With both factors no longer in play people can't afford their cars and are default…

Stimulus checks were what $2000 total. That's less than 10% on a new car and most competent banks look at your monthly payment and DTI to determine how much to loan. > A recession is bad for the party in power and a lot of the economic catastrophe drumbeat started around the time early polls opened up. They've moved from economy to gas and the polls are now on crime. Really anything to stir up FUD.

> Stimulus checks were what $2000 total.

My family of 3 got something like 7k. Over that with child tax credit prepayments.

Re: US economy returned to growth last quarter, expanding 2.6%

#199

Post by vikingerik »

com2kid wrote: post #187
vikingerik wrote: post #136

Earlier quoted context omitted.

There never was a real recession - it's an artifact of year-over-year numbers that were so skewed from pandemic effects. Pent-up consumer demand shifted much activity from 2020 into 2021. This is the source of all the apparent weirdness. Every yearly number in 2021 looked great thanks to comparing an artificially high number to an artificially low 2020 baseline. Then every yearly number from 2022 looks terrible, beca…

> The inflation of 2022 is also largely an illusion - it's really just that a few percentage points of what should have been normal inflation in 2020 and first-half 2021 was time-shifted into 2022. Food prices are up 48% at the nations second largest grocery chain. Rent prices are now through the roof, 20-30% year over year increases are common in major cities. Things are more expensive, full stop, and it isn't just…

That's exactly what I'm talking about. Don't look at year-over-year numbers, you're falling for the illusion. A rent jump of 20% for 2022 is because rents were artificially suppressed in 2020 and 2021.

The right comparison is to look at 2022 compared to 2019 and see if it looks out of line for a three-year period. A few things are, but most aren't.

Also, citing one grocery chain is a cherry-picked outlier. Cite them all if you want a real number and not an artificial illusion.

Re: US economy returned to growth last quarter, expanding 2.6%

#200

Post by treeman79 »

themitigating wrote: post #95
treeman79 wrote: post #74

Earlier quoted context omitted.

Be real fun when the strategic oil reserve runs out / stop draining it after November Election. Nothing was done to increase domestic supply. And OPEC has decided to tighten the screws on us.

When will it run out?

https://www.forbes.com/sites/davidblackmon/2022/10/20/presid...

Oil reserve has a mix of different kinds of oils. We’ve been using up the better stuff. Not sure how much of that’s left.

US has a 25 day supply of diesel.

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