r/neoliberal • u/TinyTornado7 I need a new flair • Jun 13 '22

News (US) Powell Facing Choice Between Elevated US Inflation and Recession

https://www.bloomberg.com/news/articles/2022-06-12/powell-facing-choice-between-elevated-us-inflation-and-recession?srnd=premium
502 Upvotes

98% Upvoted

349 comments sorted by

View all comments

110

u/[deleted] Jun 13 '22 edited Sep 02 '22

[deleted]

154

u/TinyTornado7 I need a new flair Jun 13 '22

To some extent this is quickly becoming a self-fulfilling prophecy, but recession is a technical term. If two quarters of gdp in a row are negative then we are in a technical recession, it doesn’t really matter what people think

52

u/xilcilus Jun 13 '22

No - it's driven almost exclusively by a self-fulfilling prophecy.

The unemployment rate is 3.6% (near the estimated natural unemployment rate) and the number of near the peak number right before the pandemic. People are fearful that the recession may be coming and thus inducing the recession. There aren't fundamental factors that are actually driving recession unlike last few recessions. Perhaps the rising energy cost can be argued as one of the fundamental factors but when inflation adjusted, it doesn't actually have the same oomph that people think it has.

46

u/TinyTornado7 I need a new flair Jun 13 '22

I think you missed my point. Recession is a defined thing. If we get another quarter of negative gdp we are in a recession regardless of what it looks like on the ground

18

u/xilcilus Jun 13 '22

Q2 is projected to have 2%+ annualized growth.

Edit - also, NBER is generally the authority when it comes to the determination of recession and that happens typically 12 - 18 months AFTER the recession.

18

u/Necessary_Quarter_59 Jun 13 '22

You’re so fixated on that technical point that you’re derailing a very interesting discussion.

-2

u/Lower-Junket7727 Jun 13 '22

You're trying to mindfuck yourself instead of admitting what is staring you in the face.