There's also a divide between tactics efficient at the individual level and that efficient at a national or global level. E.g. you can tell an individual they should be a doctor/lawyer/engineer/etc and that's good advice, but if everyone does it then who grows food and cleans floors and etc?
I'm sorry it was difficult to understand.
How many are really increasing productivity in the long run anyway?
When you think about it, their own employers must be satisfied with the lower productivity of a smaller staff or they wouldn't be kicking people out.
Edit: Not my downvote. Corrective upvote actually.
• Women entering the work force
• Immigration
• Globalization
(Ironically the one time I was one of the few hundred, our chosen candidate - who was excellent - got beaten by the Greens in an election upset)
Govt handouts during the pandemic added significant money without increased production to keep people afloat, which is good short term. The cost of that is inflation medium term. Long term wages rise to offset inflation. This has always been the pattern. Adding money for nothing to the system devalues each piece of money, so inflation is expected.
Long term wages for context https://www.visualizingeconomics.com/blog/2008/05/04/average...
https://theovershoot.co/p/americas-excess-household-savings
You’re likely referencing the savings rate, which is a different concept. This measures how much of newly earned income is saved, not how much excess savings somebody has in an absolute sense.
https://fred.stlouisfed.org/series/PSAVERT
Aside from savings, household credit is still below pre-pandemic trends in real terms, just touching the nominal trend recently.
Sounds like the problem is solving itself then?
History shows there’s likely going to be a severe recession at the end of this
Its almost always quite low, which is the reason inflation is high and the Fed has to throw the economy into recession.
Low unemployment is a recession precursor, not the other way around. Very clear from the data
Show me on this chart where unemployment goes low and stays low for an extended period? It has never happened.
Recession dynamics in relation to unemployment are well understood. Low unemployment as a driver of inflation is well understood. Fed reaction function in relation to inflation is well understood. The consequence of higher unemployment as a result of higher real rates is well understood
Only immaculate disinflation can prevent a recession at this point. If fed has to induce it, a recession is all but guaranteed
Show where on the chart it stays flat for long period of time.
You're just moving goalposts at this point.
The fact is, and is demonstrated by that chart, that unemployment tends downwards between recessions, then jumps during them. And each recession had an uptick before the recession. The down trend length is not at all indicative of impending recession from that chart. And, as I pointed out to begin with, the current unemployment is not having that uptick. Many of the upticks took over a year from uptick start to recession. And there's ample upticks more than 5 years before the next recession. So uptick does not imply recession, but lack of uptick implies no recession soon. There is not a single example among the 12 recessions in that data (and, if you look at other country data, the same pattern appears).
My original point is correct: there is yet no sign in the unemployment data of impending recession, no matter how much you seem to want one, so much so you make incorrect claims about the data without actually checking the data.
>Recession dynamics in relation to unemployment are well understood. Low unemployment as a driver of inflation is well understood. Fed reaction function in relation to inflation is well understood. The consequence of higher unemployment as a result of higher real rates is well understood
Those are partially understood - if there were such a causal or even empirical link from one to the other we'd not need the NBER to analyze macro variables to decide on recessions. This is not physics - there is a lot more uncertainty, and some factors move over time as different factor weights change (and even political will to do things). That there is no simple way to look at all the variables you mention and claim "impending recession!" with any certainty is the most salient fact of all.
And, as I pointed out, unemployment is not at this moment pointing to immediate recession, unless you have a never before seen relation between them.
Where as soon as each official recession has been deemed to occur in retrospect according to today's terms, then unemployment shoots up since so many people are kicked out.
As we have seen.
Yes, that graph shows the "retrospect" recession start, and every one is after unemployment rises. But not every rise in unemployment yields a recession.
Currently there is not a rise in unemployment.
This isn't propaganda - it's econ 101. Read any intro econ textbook and all this is completely expected, historically backed up by many events for centuries in hundreds of countries. There's no propaganda.
M1 money (a common measure of the money supply) went from around 4 trillion to over 16 trillion in a matter of months during the pandemic [1] as a result of the govt adding trillions of dollars - a completely unprecedented amount.
Do you really think a govt can simply throw trillions into an economy at this rate and not have inflation?
This is how it's been done the world over, and it works pretty well, despite pop articles creating more panic than is warranted. Money has been added in the past to smooth out the 18th and 19th century boom and bust cycles, and it has worked extremely well compared to past pain.
Every country on the planet has chosen central banking since the evidence it's better than the alternatives has been overwhelming for almost a century.