Why a global recession is inevitable in 2023 • Hacker News Board

Re: Why a global recession is inevitable in 2023

#161

Post by Izkata » Sun, Jan 01, 2023, 6:59 PM UTC

opportune wrote: post #124

jmartrican wrote: post #29

When 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 am pretty into investing and for the past two years have been doing it almost solely on the basis of macro principles. Inflation in the last 6 months in the US, as measured by the Fed’s CPI, has been about 2%. All the higher inflation headlines are simply comparing the CPI 12 months ago to today, but the fact of the matter is ever since June/July CPI’s annualized inflation is already at roughly 4% or lower. The Fed…

> If they stop there, the recession risk is IMO minimal because employment metrics are still very strong.

Typically unemployment doesn't spike until months after recessions begin: https://fred.stlouisfed.org/series/UNRATE

Re: Why a global recession is inevitable in 2023

#162

Post by lyu07282 » Sun, Jan 01, 2023, 7:05 PM UTC

stocknoob wrote: post #11

paulpauper wrote: post #3

Hasn'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.

As the saying goes, economists have predicted 8 of the last 3 recessions.

Listening to economists predictions on the economy is like listening to theologians, the least likely to know anything truthful about religion.

Re: Why a global recession is inevitable in 2023

#163

Post by dragonwriter » Sun, Jan 01, 2023, 7:06 PM UTC

hdjjhhvvhga wrote: post #134

oliwarner wrote: post #116

Earlier quoted context omitted.

Major economies are already in deepening recessions. Major producers are starting the year with significant impairment from COVID and supply line pressures. The threat of Russia's aggression affecting other countries remains. Energy prices are still obscene in Europe. I hope things get better, but I think you'd be mad to plan for global growth this year.

> The threat of Russia's aggression affecting other countries remains. Like what countries exactly? They can't even hold the ground they conquered in the previous months in Ukraine. Armenia already asked Russia's help and they refused - it was effectively a fatal blow to CSTO and has far-reaching consequences to the way Russia is perceived among its current and former allies.

> They can’t even hold the ground they conquered in the previous months in Ukraine.

Because the West is throwing lots of resources at that. Should that resolve crumble, that could change.

> Armenia already asked Russia’s help and they refused - it was effectively a fatal blow to CSTO and has far-reaching consequences to the way Russia is perceived among its current and former allies.

Should the West shift to a more containment-oriented policy, the beyond-Ukraine danger is largely to CSTO countries. (Yes, they are nominal allies, but so was Afghanistan.)

Re: Why a global recession is inevitable in 2023

#164

Post by dcolkitt » Sun, Jan 01, 2023, 7:06 PM UTC

samwillis wrote: post #47

Disclaimer, 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…

No, the fundamental reason for lack of housing affordability is a lack of supply relative to demand. Since 2008 we've dramatically under built new housing units relative to household formation. Playing with inflation or interest rates may change who loses out, but it still doesn't change the fundamental problem that we don't have enough housing to go around.

Re: Why a global recession is inevitable in 2023

#165

Post by awinder » Sun, Jan 01, 2023, 7:08 PM UTC

ianai wrote: post #95

jjeaff wrote: post #76

Earlier quoted context omitted.

I'm not aware of them buying any individual stocks recently. They did, however buy several (like GM) during the 2008 recession.

Right, they bailed out corporations and threw people out of their homes. Never forgive, never forget. I’d still largely say this Fed is departing from history. The economy last saw a pandemic like covid in 1918. And that was during a world war.

Bailing out companies keeps people in jobs & backstops the assets that comprise retirement/pension systems, both of which keep people in their homes. You could find ways of keeping more people in their homes but they’d almost certainly include bailing out companies, it’s easy to implement and cost effective.

Re: Why a global recession is inevitable in 2023

#166

Post by 2devnull » Sun, Jan 01, 2023, 7:09 PM UTC

jmartrican wrote: post #29

When 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.

Cool. Go long heavily leveraged and repost this thread next year to really show off. :)

Re: Why a global recession is inevitable in 2023

#167

Post by Izkata » Sun, Jan 01, 2023, 7:11 PM UTC

jokethrowaway wrote: post #104

d0mine wrote: post #32

Earlier quoted context omitted.

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

Two quarters of negative growth has only ever been a rule-of-thumb that mostly matched, the official determination has been with the National Bureau of Economic Research for a long long time ( https://www.nber.org/ ).

You can see on this graph that the rule-of-thumb didn't hold right at the beginning of the graph in 1947 when no recession was declared, nor in 2008 when it started with a single quarter, or even 2001 when it started with a positive quarter: https://fred.stlouisfed.org/series/A191RL1Q225SBEA

Re: Why a global recession is inevitable in 2023

#168

Post by AnimalMuppet » Sun, Jan 01, 2023, 7:12 PM UTC

olonn wrote: post #158

hdjjhhvvhga wrote: post #134

Earlier quoted context omitted.

> The threat of Russia's aggression affecting other countries remains. Like what countries exactly? They can't even hold the ground they conquered in the previous months in Ukraine. Armenia already asked Russia's help and they refused - it was effectively a fatal blow to CSTO and has far-reaching consequences to the way Russia is perceived among its current and former allies.

probably finland and other countries near russia

Yeah, high-up Russian politicians have been talking about invading Finland or Poland or both.

And if the GP says that they don't have the military strength to pull that off, well, they don't. But they don't have the military strength to defeat Ukraine, and yet the fighting goes on, in complete defiance of sanity. No, Russia can't (successfully) invade either place. That doesn't mean he won't try. If I were Finland or Poland, I'd be preparing hard right now.

Re: Why a global recession is inevitable in 2023

#169

Post by Izkata » Sun, Jan 01, 2023, 7:15 PM UTC

SantalBlush wrote: post #111

boh wrote: post #99

Earlier quoted context omitted.

Most recessions are identified after they've occurred, particularly on a global scale, since the evidence is rarely obvious. Not all countries, industries, states will be affected equally. It's completely possible the recession has already occurred and we're currently in the midst of it.

While this is true, the statement "We don't know that we're not in a recession" is not evidence that we're in a recession. Looking at the evidence that we do currently have--GDP, unemployment, etc.--that evidence strongly suggests that we are not in one.

The low unemployment rate indicates we're likely either in or about to start a recession. It generally doesn't spike until months after recessions begin: https://fred.stlouisfed.org/series/UNRATE

Re: Why a global recession is inevitable in 2023

#170

Post by AnimalMuppet » Sun, Jan 01, 2023, 7:15 PM UTC

boh wrote: post #99

jmartrican wrote: post #29

When 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.

Most recessions are identified after they've occurred, particularly on a global scale, since the evidence is rarely obvious. Not all countries, industries, states will be affected equally. It's completely possible the recession has already occurred and we're currently in the midst of it.

This is kind of obvious if you take the amateur-level definition of a recession - two quarters of negative economic growth. A month after the end of the second quarter, when the statistics for that quarter become available, then you know that a recession started two quarters ago.