NEW YORK (AP) — Most business economists think the U.S. economy could avoid a recession next year, even if the job market ends up weakening under the weight of high interest rates, according to a survey released Monday.
Only 24% of economists surveyed by the National Association for Business Economics said they see a recession in 2024 as more likely than not. The 38 surveyed economists come from such organizations as Morgan Stanley, the University of Arkansas and Nationwide.
Such predictions imply the belief that the Federal Reserve can pull off the delicate balancing act of slowing the economy just enough through high interest rates to get inflation under control, without snuffing out its growth completely.
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High rates work to slow inflation by making borrowing more expensive and hurting prices for stocks and other investments. The combination typically slows spending and starves inflation of its fuel. So far, the job market has remained remarkably solid despite high interest rates, and the unemployment rate sat at a low 3.9% in October.
Does this mean rent will get easier to pay, or am I still boned?
Well, according to the article:
Of course, economists are only expecting price increases to slow, not to reverse, which is what it would take for prices for groceries, haircuts and other things to return to where they were before inflation took off during 2021.
Well, fuck.
And of course wages aren’t going to take a leap forward either.
Wages are growing on average, and faster than inflation (5.2% wage growth vs 3.2% inflation year over year for the past year). Takes two seconds to Google.
https://www.statista.com/statistics/1351276/wage-growth-vs-inflation-us/
Somewhat remarkably considering the problems with income inequality in the US, wages are growing the fastest of all among people with lower incomes (though all the wage increases in the world aren’t gonna tackle the problem of the power of the 0.1% investor class of wealth hoarders).
https://www.epi.org/publication/swa-wages-2022/
https://www.marketplace.org/2023/03/08/lower-income-earners-wages-have-grown-faster-than-others/
It’s pretty expected to given the persistent low unemployment and a high labor demand.
Not saying there’s no concerns at all in the entire economy or anything crazy. But you don’t have to spread disinformation like wages aren’t growing.
Can’t wait to be told “actually sweetie Biden fixed inflation” even though nothing actually got better. It just stopped getting worse as fast.
How would you describe ‘fixed’ inflation?
Price decreases would be deflation, but fixing inflation is literally something like stopping/slowing the rate of increase.
Yes, that’s what fixing inflation means. I would like to know what you envision Biden doing. Decree that prices will go down? Not going to happen because there’s no mechanism for that kind of fiat.
Can you explain how/why you think either Biden or Trump is related to the cost of rent? Just trying to understand your comment
Rent and housing are under a supply crunch, unless the population stops growing, or construction speed doubles, nothing is going to drop prices.
The rich people already buying homes now would just buy the new homes. Even brand new homes in my area are selling for almost half a million when just before Covid they’d be like 280k or 320k. People not to stop pretending like housing a supply issue and not a corporations-and-rich-people-buying-everything-up issue. When new construction comes up with these ridiculous prices, the people who already own multiple properties just buy it up because they can already easily afford to. All you need is to be able to get a few properties and after that the money makes itself which is why all of the sudden everyone’s interested in real estate the last few years. Builders don’t care about it because there are still companies and people able to pay these obnoxious prices. Don’t even get me started on how everyone thinks they’re a genius for realizing how profitable buying homes to use as Airbnbs is.
Every economists was predicting recession a few months back. They have an accuracy rate less than horoscopes
Tbf, the act of predicting a recession can change the outcome, since the economy is just people reacting to things with money.
If everyone is expecting their houses to fall down from thin walls, so they start adding panels to their walls, suddenly the newly sturdy walls arent falling down anymore.
Right except people aren’t lemmings. Just because I hear some talking head say how he thinks there will be a recession in a month doesn’t mean I cut all spending.
An individual is not a lemming, no. But people? People are scared, stupid, lemmings who will follow the crowd, almost every time.
We’re social creatures, designed to work in groups. The downside (or upside I guess) is that people do follow the crowd.
Maybe because it is true and no one wants to hear government economists bullshit about how everything is fine when everything is not fucking fine.
So sick of economist lying crap. Telling us we can’t have universal healthcare and we can’t get rid of student loan debt but we have to give free money to banks and trade with countries that have slavery.
But it’s simply untrue.
Here is goldman sachs saying, over a year ago, that a path to a soft landing is hard but feasible. Here is an economist, from over a year ago, predicting that the chance of a soft landing was going up. Here are 3 economists writing for the Harvard business reviewing saying, back in Februrary, that the chances of a soft landing were good and calls for a recession were premature.
The whole point of the fed’s policy on the rates was to tamp down on inflation while at the same time avoiding a recession. They are, of course, economists. At this point we look like we have good odds to pull of what they were intending to pull off.
I don’t know where you get your information from, but if you thought no one thought was predicting a soft landing until a few months ago, well it’s safe to say you don’t really pay much attention to these things because plenty of economists have been predicting it likely, or going to happen, even for a long time. I’ve only heard a handful of economists even come close to virtually assuring a recession.
It should be clearly stated that recession is a technical term with a specific meaning, not a general term for a rough economy. Not all tough economic times are recessions. It is not at all a contradiction for lots of people to be struggling and for a recession to not be happening. This is not economists saying that everything is hunky dory and that people have no reason to complain, only that the specific phenomenon that is a recession is not occurring right now.
Edit: Just to put it explicitly, a recession is generally defined as two or more successive quarters in which GDP contracts rather than growing.
I am unemployed and have been for many months. I have never had issues finding a job, but finding one lately has been impossible. I know of 3 others in the same boat as I. I think that a recession is inevitable at this point. Lucky for me, I have other sources of income. I did have to drastically cut back spending, however.
There is definitely something going on lately. I’m always looking for better jobs on indeed, professional recruiting services etc, trying to improve my situation.
In the last 4 months its been seemingly impossible to even get a response, and I know I’m more than qualified for these positions I’m applying to, and I’ve never had an issue before, even during severe economic downturns.
This is a nightmare scenario for me. What are the other sources of income, if you don’t mind me asking?
Here’s my gripe with economists. Even if this wasn’t true, wouldn’t be in the best interest of the economy to lie about it so the market doesn’t get spooked and end up doing things that would make inflation worse?
What other ‘science’ has that nifty feature in it?
Regular medical science, it is called the placebo effect. It only works a bit. Not like you are going to regrow a limb, more like if you had a 40% of getting better on your own you now have a 50%.
Truth is economists can’t predict shit and recessions happen based on numbers not based on feelings. We can’t click our heels together and wish our way to a better world.
