US economy will continue to recover - Powell - page 2.

jaysabi

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Quote from: exstasie on September 17, 2020, 06:39:33 PM

This is what they said about the current recession, as of 7 weeks ago:

Quote

The committee's view is that while each of the three criteria—depth, diffusion, and duration—needs to be met individually to some degree, extreme conditions revealed by one criterion may partially offset weaker indications from another. For example, in the case of the February 2020 peak in economic activity, we concluded that the drop in activity had been so great and so widely diffused throughout the economy that the downturn should be classified as a recession even if it proved to be quite brief.

https://www.nber.org/cycles/recessions_faq.html

As such, I expect them to wait a while before they are willing to declare the recession over, even if Q3 shows a robust recovery.

Yeah, this is kind of my point. That if we are going by the technical definition of a recession, we will be showing the recession as having ended before (and possibly long before) we actually start to feel like the economy is getting back to firm ground. After having fallen so far, any modest recovery would be enough to classify it as "not technically a recession" any longer even though what has been recovered leaves you far behind were you would have been without the set back.

I'm not sure I like the subjective nature of deciding what a recession is though. The "you'll know it when you see it" argument is used for art and porn, sure. But I don't like it for qualifying a recession. That one is too technical.

Silberman

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Quote from: pixie85 on September 15, 2020, 04:15:49 PM

Quote from: tbterryboy on September 06, 2020, 09:13:51 AM

The thing about printing money is that it makes your money a lot less valuable, when it doesn't worth as much as it used to you have to pay more for stuff and when you pay more for stuff you end up having more debt for it and when you have more debt there is a crisis and when there is a crisis you print more money. You see how it goes around in circles?

This is exactly why I believe it should be noted that governments should not print money, no matter what the situation is, flushing down the economy time to time would teach people a lesson, some will be super poor, but people are poor already, but in return we will get hundreds of billions of dollars (even trillions) not going towards companies, those companies will bankrupt and this will give a lot bigger lesson to be careful to companies than people.

Printing makes money less valuable so it's bad for people with savings but it also has some positive sides. People who own property will see it retain its value and the newly printed money will save the economy from going into full recession shutdown mode.

If the US economy does recover the stock market will go back up and so will Bitcoin so let's hope this is more than a prediction.

There is no doubt there are some positive sides to printing money when it comes to a fast recovery of the economy but by doing so governments whether they like to admit or not are stealing money from their citizens, because as we know even if the amount of money in your savings account remains the same now what you can purchase with has gone down due to inflation, this is one of the many reasons I think there is future for bitcoin because it cannot be printed at will and once we go through hyperinflation as governments lose control of their printing machines people will try to look for ways to protect themselves and bitcoin will be there to help them.

exstasie

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Quote from: jaysabi on September 17, 2020, 10:31:14 AM

Well the definition of a technical recession is two or more consecutive quarters of negative GDP growth. We hit that in the first and second quarters of the year with approximately -1.3% and -9% respectively (on a non-annualized basis). Every major bank is expecting robust growth in third quarter around 7-9% (non-annualized) and a modest increase in the fourth quarter. So on in this vein, we will no longer be in a technical recession as of the end of the third quarter.

A recession more generally (and not technically) can compare year-over-year quarterly results. From this perspective, 3rd and 4th quarter of this year are very likely to be lower than 3rd and 4th quarter last year, which could qualify as a recession (even though the economy is technically growing quarter over quarter). Barring a setback, we would expect this "recession" to have ended by the end of the first quarter of 2021, since (again barring a setback) Q1 2021 GDP will be higher than Q1 2020.

However, even if that were the case where no way you look at it is the economy in "recession," I think it will be clear that the economy is likely to be pretty poor at that point given where we were before Covid happened, so the classification of recession or not is missing the forest for the trees.

I think the NBER's criteria (the basis by which the US is "officially" in recession or expansion) is relevant here. They don't use the commonly held definition about 2 consecutive quarters in contraction:

Quote

While the popular definition of a recession is “two consecutive quarters of negative real gross domestic product (GDP) growth,” the NBER does not strictly abide by this designation (note 2). Instead, the committee broadly defines a recession as a “significant decline in economic activity spreading across the economy, lasting more than a few months.”

This is what they said about the current recession, as of 7 weeks ago:

Quote

The committee's view is that while each of the three criteria—depth, diffusion, and duration—needs to be met individually to some degree, extreme conditions revealed by one criterion may partially offset weaker indications from another. For example, in the case of the February 2020 peak in economic activity, we concluded that the drop in activity had been so great and so widely diffused throughout the economy that the downturn should be classified as a recession even if it proved to be quite brief.

https://www.nber.org/cycles/recessions_faq.html

As such, I expect them to wait a while before they are willing to declare the recession over, even if Q3 shows a robust recovery.

panganib999

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Quote from: Juggy777 on August 27, 2020, 12:17:49 PM

Further there’s more bad news for the jobless people as he’s claimed that they’ll not be able to land jobs, and thus they will continue to remain jobless in the long run.

Then how come it would be claimed that the US economy will continue to recover when there is no existence of landing a job to those jobless people who specifically might have loss their jobs all due because of the existence of the pandemic. It was an awful surprise to know that the government cannot land any job for them and they would just remain on that current situation for the long run as stated. Is it contradicting to claim that they are into the phase of recovery when there is no availability of jobs for the people? Man power is one of the elements needed by the country to prosper and continuously grow, it would really be a sad thing to claim such if job availability won't come for a long run.

jacafbiz

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US has the best economic in the world and most country depend on it, as long as people still have trust in USD expect the economy to recover. A lot is going on here that is merely politics and when election is over all these noise we die down and focus will be on substance. FED will do everything in their capacity to let this work out fine

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Quote from: bryant.coleman on September 14, 2020, 11:34:18 PM

Quote from: jaysabi on September 14, 2020, 06:36:59 PM

Yeah, that's because it's not safe to go out and do things like there is no pandemic. We're technically in a "recession" because we've had two straight quarters of negative GDP growth, but again, not because the economy has faltered on its own, but because of a health crisis forcing everyone to reduce economic activity. The recession will be "over" in that GDP is going to surge in the third quarter, but we'll still be far far below where we would have been without the pandemic. Characterizing the economy as being in "recovery" hides how bad things still are.

Recession will be there for at least two more quarters. Those who have burned up all of their savings are not going to splash their money, even if the restrictions on social distancing are removed. I am not sure how the GDP growth is calculated, but if I am not wrong, then the GDP of a particular quarter is compared to the figure from the corresponding quarter of previous year (for example, Q1Y2020 vs Q1Y2019 and so on).

Well the definition of a technical recession is two or more consecutive quarters of negative GDP growth. We hit that in the first and second quarters of the year with approximately -1.3% and -9% respectively (on a non-annualized basis). Every major bank is expecting robust growth in third quarter around 7-9% (non-annualized) and a modest increase in the fourth quarter. So on in this vein, we will no longer be in a technical recession as of the end of the third quarter.

A recession more generally (and not technically) can compare year-over-year quarterly results. From this perspective, 3rd and 4th quarter of this year are very likely to be lower than 3rd and 4th quarter last year, which could qualify as a recession (even though the economy is technically growing quarter over quarter). Barring a setback, we would expect this "recession" to have ended by the end of the first quarter of 2021, since (again barring a setback) Q1 2021 GDP will be higher than Q1 2020.

However, even if that were the case where no way you look at it is the economy in "recession," I think it will be clear that the economy is likely to be pretty poor at that point given where we were before Covid happened, so the classification of recession or not is missing the forest for the trees.

pixie85

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Quote from: tbterryboy on September 06, 2020, 09:13:51 AM

The thing about printing money is that it makes your money a lot less valuable, when it doesn't worth as much as it used to you have to pay more for stuff and when you pay more for stuff you end up having more debt for it and when you have more debt there is a crisis and when there is a crisis you print more money. You see how it goes around in circles?

This is exactly why I believe it should be noted that governments should not print money, no matter what the situation is, flushing down the economy time to time would teach people a lesson, some will be super poor, but people are poor already, but in return we will get hundreds of billions of dollars (even trillions) not going towards companies, those companies will bankrupt and this will give a lot bigger lesson to be careful to companies than people.

Printing makes money less valuable so it's bad for people with savings but it also has some positive sides. People who own property will see it retain its value and the newly printed money will save the economy from going into full recession shutdown mode.

If the US economy does recover the stock market will go back up and so will Bitcoin so let's hope this is more than a prediction.

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Quote from: jaysabi on September 12, 2020, 03:37:02 PM

Quote from: kawetsriyanto on September 10, 2020, 06:31:05 PM

There are many desires that can lead the economy in the US to increase highly. However, is it the real data or not? As we know, the US also faces a difficult moment because of the recession and this pandemic like most countries in the world. But, how can they recover the economy so suddenly? they are a big country and it may not be so difficult to recover it. But, we can see the updates of how the development because it is also heading to the election??

The recession though isn't caused by any fundamental weakness in the economy, but by the need to reduce economic activity to combat the spread of the virus. Since the economy was artificially slowed and did not lose momentum on its own, this gives us reason to hope that the recovery will be similarly as swift. It's not a lack of demand harming the economy, it's health concerns causing demand to drop. Remove the health concern, remove the artificial recession.

This is wishful thinking and nothing more, a reduced economic activity will not be a problem if businesses were managed in a conservative way, but this is not the reality of our economy, the focus is on ever increasing profits and disregard everything else, this means that most companies were heavily indebted and they were not prepared to have their doors closed for months, many business have gone bankrupt and many more will probably do so during the next months as people either do not have money to spend and those that do keep it in case they need it for important stuff.

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Quote from: jaysabi on September 14, 2020, 06:36:59 PM

Yeah, that's because it's not safe to go out and do things like there is no pandemic. We're technically in a "recession" because we've had two straight quarters of negative GDP growth, but again, not because the economy has faltered on its own, but because of a health crisis forcing everyone to reduce economic activity. The recession will be "over" in that GDP is going to surge in the third quarter, but we'll still be far far below where we would have been without the pandemic. Characterizing the economy as being in "recovery" hides how bad things still are.

Recession will be there for at least two more quarters. Those who have burned up all of their savings are not going to splash their money, even if the restrictions on social distancing are removed. I am not sure how the GDP growth is calculated, but if I am not wrong, then the GDP of a particular quarter is compared to the figure from the corresponding quarter of previous year (for example, Q1Y2020 vs Q1Y2019 and so on).

TIDOVEE

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There is one thing I so much like and appreciate about the US government, and it is that every government competitively stands to bear all necessary pain no to have a lesser delivery and to make sure they get no condemnation over the economy, just that in this existing condition,it's like the government has very little to do to put the jobless back in place. This time around, it's a harder nut for the government to crack since obviously almost all nations economy is affected, yet this is an opportunity to approve the competent government.

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Quote from: Vishnu.Reang on September 13, 2020, 08:25:22 AM

Quote from: jaysabi on September 12, 2020, 03:37:02 PM

The recession though isn't caused by any fundamental weakness in the economy, but by the need to reduce economic activity to combat the spread of the virus. Since the economy was artificially slowed and did not lose momentum on its own, this gives us reason to hope that the recovery will be similarly as swift. It's not a lack of demand harming the economy, it's health concerns causing demand to drop. Remove the health concern, remove the artificial recession.

Even after the governments removed some of the restrictions a lot of the people were still staying at home, avoiding non-essential travel. If they stay at home, that means that by default the consumption will go down. And this can have a negative impact on the economy. There is no quick-fix solution to this as of now, as a vaccine is many months away. I am guessing that the economy will remain in a suppressed state for at least 6 more months.

Yeah, that's because it's not safe to go out and do things like there is no pandemic. We're technically in a "recession" because we've had two straight quarters of negative GDP growth, but again, not because the economy has faltered on its own, but because of a health crisis forcing everyone to reduce economic activity. The recession will be "over" in that GDP is going to surge in the third quarter, but we'll still be far far below where we would have been without the pandemic. Characterizing the economy as being in "recovery" hides how bad things still are.

Vishnu.Reang

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Quote from: jaysabi on September 12, 2020, 03:37:02 PM

The recession though isn't caused by any fundamental weakness in the economy, but by the need to reduce economic activity to combat the spread of the virus. Since the economy was artificially slowed and did not lose momentum on its own, this gives us reason to hope that the recovery will be similarly as swift. It's not a lack of demand harming the economy, it's health concerns causing demand to drop. Remove the health concern, remove the artificial recession.

Even after the governments removed some of the restrictions a lot of the people were still staying at home, avoiding non-essential travel. If they stay at home, that means that by default the consumption will go down. And this can have a negative impact on the economy. There is no quick-fix solution to this as of now, as a vaccine is many months away. I am guessing that the economy will remain in a suppressed state for at least 6 more months.

jaysabi

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Quote from: kawetsriyanto on September 10, 2020, 06:31:05 PM

There are many desires that can lead the economy in the US to increase highly. However, is it the real data or not? As we know, the US also faces a difficult moment because of the recession and this pandemic like most countries in the world. But, how can they recover the economy so suddenly? they are a big country and it may not be so difficult to recover it. But, we can see the updates of how the development because it is also heading to the election??

The recession though isn't caused by any fundamental weakness in the economy, but by the need to reduce economic activity to combat the spread of the virus. Since the economy was artificially slowed and did not lose momentum on its own, this gives us reason to hope that the recovery will be similarly as swift. It's not a lack of demand harming the economy, it's health concerns causing demand to drop. Remove the health concern, remove the artificial recession.

kawetsriyanto

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There are many desires that can lead the economy in the US to increase highly. However, is it the real data or not? As we know, the US also faces a difficult moment because of the recession and this pandemic like most countries in the world. But, how can they recover the economy so suddenly? they are a big country and it may not be so difficult to recover it. But, we can see the updates of how the development because it is also heading to the election??

Silberman

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Quote from: tbterryboy on September 06, 2020, 09:13:51 AM

The thing about printing money is that it makes your money a lot less valuable, when it doesn't worth as much as it used to you have to pay more for stuff and when you pay more for stuff you end up having more debt for it and when you have more debt there is a crisis and when there is a crisis you print more money. You see how it goes around in circles?

This is exactly why I believe it should be noted that governments should not print money, no matter what the situation is, flushing down the economy time to time would teach people a lesson, some will be super poor, but people are poor already, but in return we will get hundreds of billions of dollars (even trillions) not going towards companies, those companies will bankrupt and this will give a lot bigger lesson to be careful to companies than people.

It is obvious that most of us will have similar thoughts regarding this, in fact during a lot of time in the past even if governments minted their own coins the coins minted by private institutions and individuals were accepted as long as they were made of gold and silver but then governments outlawed this practice because they wanted to get control of the money supply.

As such governments know exactly what they are doing and for the most part they aren't going to give up that right willingly and even if they lose it in practice in the case of a currency crisis you can be sure they will try to regain it as soon as it is over, so in my opinion this is going to be a battle fought for a very long time but fortunately now we have bitcoin on our side to give us an edge.

seoincorporation

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It looks like it's on the recover way, but at the end is only a bubble filling up, when the bubble crash it will be worst than 2008. Remember what happens there... tons of people using their homes, their cars and just getting more debts with the Government. The economy will not recover by the printing money way, that is a big mistake that grows up the country debt.

barbara44

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How though? Like tens of millions of people are out of work right now, and nasdaq says everything is okay? US economy will not recover, it can't recover, the system is broken and as long as system is broken how could it ever recover. It is like saying a broken foot will heal when it is not even in a casket, it is just limping there, dude is walking with a broken foot, it hurts every time he steps, but he keeps walking with that broken foot like nothing happened because eventually it will heal.

Instead of letting it be, USA should instead put it to rest for few weeks, cast it and just make it heal a lot faster and a lot better, that way it could go back in a few weeks like nothing happened. But that would mean loss of money for the rich so they are not doing that at all, not even remotely close to it.

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I do not get how the economy is recovering in the statistical way. I mean think about it, while stocks are breaking new records and everything looks awesome in that way, there are over 20 million unemployed people, considering how much of the population is retired old people and people who are too young to work, the population left has over 20 million unemployed people, that is USA historical record and never has been done before.

So while stocks are super high, the unemployment is also breaking records, how could those two things exist together? How could it not contradict each other? How could you look at general stock market cap and say economy is great while you have people who can't afford to pay their rents? It doesn't make sense at all, I think that USA is not recovering at all and only will recover when they actually get better all together and not just stocks.

Salauddin1994

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The US economy will continue to recover but it will take some time in that case even in the most comfortable state of the US economy growth will be extremely unstable. Needless to say the worst case scenario the United States may see a long-term contraction and recession in the economy. The impact of the virus has diminished in many countries around the world and each country is trying to recover its economy trying to allocate more in the economic sector.

imstillthebest

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Quote from: Xembin on September 07, 2020, 09:52:05 AM

Obviously,US is really facing covid-19 cases,which US has the highest number of covid-19 in the world. US economy is going down because of the new number of covid-19 cases that is increasing everyday in their country.
If their government can do something fast to end covid-19 in their country like the way China is fighting their,to recover their economy fully.

no , what is written on the opening post isnt about the covid19 but if you try to read it carefully you will read the keyword such as trump , bank and election . so by that , i guess the post talks about politics but the fall of a countrys economy still have something to do with the covid19 .

we dont need or they dont need to rush things . the covid can be cure and the economy can always be revive if done slowly

Topic: US economy will continue to recover - Powell - page 2. (Read 920 times)