If it was truly 'inevitable' it would be priced in
Isn't the S&P 500 down like ~22% YTD?
Who cares? It's all funny money anyway.
Why a global recession is inevitable in 2023
101–110 of 281 posts
Re: Why a global recession is inevitable in 2023
#102Hasn't it been inevitable every years? It seems like the media writes this headline every year. Anyone can find reasons for recession if you look hard enough. Who knows. I am not selling stocks.
The exact timing is always tricky but I have seen the .COM bubble and the 2008 crash. In both it was pretty clear that the economy was in a huge speculative bubble that made no rational sense but the bubble was prolonged until there was no way forward anymore. The 2001 crash was bad, the 2008 crash worse and I think this one will be even bigger. We ran up huge deficits during good times, kept interest rates artificia…
"Business" or "money sink"?
Everything about this "boom" from 2012 on was, from a market perspective, about as artificial as you could get. At least the events leading up to the .COM and '08 crash there weren't central banks openly putting their thumbs on the scales by being an active market paticipant buying debt securities, the quality of that debt be damned, and making price discovery next to impossible.
The lesson investors took from '08 and certainly from 2020 was that the powers that be will gladly use moral hazard to protect asset prices. Profits are privatized and losses are socialized.
Re: Why a global recession is inevitable in 2023
#103I am still looking for aggressive growth. My strategy over the last ~9 months has been to buy (things I trust) on a continuous, daily basis. I intend to maintain this strategy all the way through next year as well. When I start to see lots of headlines like "recession is inevitable", I remind myself that the stock market is a time machine and/or palantir operating at some arbitrary offset in the future. Keeping my ca…
This works if what you’re buying is fair value. Plenty of dotcom names went to 0, or took 15+ years to break even.
As long as there’s a future for the company and valuation is fair, you should be fine though.
I’m doing the same. My threshold is roughly PE 15 or less with strong balance sheet and decent growth. Lots of REITs that are pretty sure bets at closer to 10x or lower multiples.
Still would not buy any 10x or more PS companies. By and large going to be stinkers over the next decade imo
Re: Why a global recession is inevitable in 2023
#104When I see predictions like this I think "awesome, no global recession coming in 2023". I have not done a study on this, but it seems like every prediction I come across is just wrong. Its like when I watch Artosis or Tasteless give a prediction during an SC2 tournament and immediately be wrong. "caster's curse" i think its called.
It depends on the definition "global recession" Who says it is not already here?
I'm sure we used to have one.
Something to do with 3 quarters of negative growth
Re: Why a global recession is inevitable in 2023
#105Disclaimer, I have no idea if this is even slightly logical, I'm not an economist. House prices have increased significantly above inflation for decades to the point of absurdity, many multiples of a households income. People in their 20s (and 30s) increasingly don't believe they will ever own a home. If we have a period of inflation, with increased wages (obviously with a painful lag), but house prices remain stagna…
You could as well single out the average cost of a new car in the U.S. At $47K I suspect that too has fast outpaced inflation. I am not aware of an automotive parallel to a "housing crash" (aside from the obvious joke that, though it begs, I will not stoop to giving voice to).
Re: Why a global recession is inevitable in 2023
#106Re: Why a global recession is inevitable in 2023
#107When I see predictions like this I think "awesome, no global recession coming in 2023". I have not done a study on this, but it seems like every prediction I come across is just wrong. Its like when I watch Artosis or Tasteless give a prediction during an SC2 tournament and immediately be wrong. "caster's curse" i think its called.
> I have not done a study on this, but it seems like every prediction I come across is just wrong .
Appealing to your sense of whether predictions are correct is a conversation starter at best. We can track forecasts and see how accurate they are.
Anyway, here are two IMF working papers:
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&c...
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&c...
Re: Why a global recession is inevitable in 2023
#108Earlier quoted context omitted.
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This is probably a comment worth ignoring, but I still feel inclined to say that journalism is a cornerstone of democracy on which, love it or hate it, we in the west have chosen to build our societies on. So yes, it is important and certainly requires skill.
Yes. The Fourth Estate is a prerequisite for a democracy.
However, what we have is a Politics Industrial Complex and the vast majority of the media is on the inside; as discussed during this episode:
https://freakonomics.com/podcast/im-your-biggest-fan/
You can't do true by-definition journalism from that position.
Speaking of the definition of journalism, using this filter most of what gets passed off as journalism, isn't.
https://kottke.org/20/01/jim-lehrers-rules-of-journalism-1
The most important skill in today's "journalism" is reading off a teleprompter and/or parroting an established narrative. That is what's rewarded. That is we get what someone else pays them for, and too often it's not actual journalism.
Re: Why a global recession is inevitable in 2023
#109Earlier quoted context omitted.
It turned out to be a stupid question indeed. People have not been able to afford rent and food in rich countries to the point of creating social unrests, let alone in poor ones. Unironically check your privilege, man.
Your response is unquestionally a bad one. If someone is desperate and on the edge during economic good times, then they're going to fall off the chart when the economy falls over. Don't blame the economy. It isn't the "economy's" job to keep a population fed and content, this is for socialized economic policies to backstop, not some delusion that good times will always be good times any any policy that adjusts again…
Look, I'm not advocating an attempt to keep the economy perpetually good.
The fact is that we have the world in a terrible economic situation. We have an editorial baffled at the state of the things. And we also have an user saying that in their understanding a depression on the top of the current situation would be "healthy part of a normal economic ebb and flow" and "not objectively bad".
I tried to tell the user in question that a recession right now might not be a problem for people in a good financial condition, but for sure it's an object of concern for the majority of the population who can't pay the bills and the people in charge who will have to deal with the revolt of such population.
Re: Why a global recession is inevitable in 2023
#110Hasn't it been inevitable every years? It seems like the media writes this headline every year. Anyone can find reasons for recession if you look hard enough. Who knows. I am not selling stocks.
Yes. And it’s actually correct. I’ve thought that US financial system and US dollar would fall since I was roughly 13. The problem is that at some point central banks and governments will be unable to avoid hyperinflation due to debt accumulation. They will be forced to print. Additionally, the debt is inevitable when politicians are bought and paid for and therefore incentivized to provide lucrative contracts to don…
"At some point" does a lot of heavy lifting. Without any information to quantify when this breaking point might occur, one might as well be talking about the heat death of the universe.
And what do you mean by "sacrifice the wealth of future generations for the sake of the current"? The government issues bonds to pay for stuff. Then at some point :) the bonds presumably become due, and future generations have to pay it back. Whom do they pay it back to? Isn't it back to themselves? Even assuming there's some proportion of foreign debt holders, they're getting paid back in the currency of the issuing state, which currency has generally deflated more than the bond rate over time, in other words effectively an interest free loan. If you could get a less than base inflation rate loan for 20, 30, 50, 100 years wouldn't you take it? Even assuming the 100 year horizon and thus the loan was to paid back by your estate, don't you think there's a good chance your estate would come out ahead after having paid back that low interest loan than if you had never taken the loan in the first place?
I'm just saying I'm not fully convinced that taking on national debt is universally bad, if it's payable in the sovereign currency.