I have been looking at the long term chart of reverting to the market median. Or whatever you’d like to call it.
We have plenty of overhead room to go higher. But every high has a hangover.
I am loving this employment market. Has me all aglow.
Look beyond the chaos and see the logic. There is logic there. I am not talking nationalism or America first. Those are another layer.
Chinese deflation, interest rates in the US and China. Resource costs to China. Russian wars all of them. Israel is the bulwork we always sought it to be.
NPR had on an expert today stating the US now spends no money on Ukraine. That is not true. The same budgeted money from 2024 is not fully spent. The EU is finally not being cheapskates with Ukraine.
There is no pessimism for those of us who are employed.
LOL - Bulwork for war? Bulwork for military occupation and stealing Palestinian land? Will the Jewish God Yehowa punish Israel?
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GDPNow, updated today, says 3.7%, down from 5%, fwiw.
We are running annual Fed deficits over 6% since 2020 (+10% in 2020, 2021 from covid), we should certainly hope that GDP grows at least 2%.
If we reduced the deficit by cutting spending and/or raising taxes, GDP growth would slow.
If we were to cut the deficit in half, to 3%, we would almost certainly be at 0% GDP growth or less.
And I’ll note that in Q4 2025, GDP did slow to near zero growth at 0.5%, I believe because of fluctuations in trade “policy” (if what we had then could be described as a policy).
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I am definitely not an economist but deficits as a percent of gdp are close to 6% and rising, vs. a 50 year historical average of about 3.8 percent of gdp. And that doesn’t count what appears to me to be a rising wall of corporate and household debt.
Maybe our pessimism is warranted if you look under the hood and question our capacity to prop up the world’s economy with infinite debt.
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This board has been pessimistic since forever, including when Mish was here. Maybe even before that, dunno.
One thing I have noticed in my time in the market, it’s possible to get out clean even if you don’t get out at the very tippy top. The 2000 dot-com crash didn’t happen overnight, it was a series of rolling downhill steps which were pretty apparent to anyone who was looking.
I recall the 2008 fiasco, and don’t rmember whether it was days or weeks before the denouement that I said to Mrs. Goofy “I don’t like this, bad stuff is going to happen” and got out.
Even Covid came as s bolt out of the blue, yet the market took days and days to fully react, and you could have made steps to the doorway if you so chose.
I just looked up 1929, often heralded as the greatest crash ever, and it was on that first date, yet you could have gotten out a week later and still been 90% whole. You didn’t need to be Joe Kennedy and take the “shoeshine boy” tip as a premonition.
So, shorter version: don’t worry. Be happy. You don’t need to have your finger on the trigger at all times, maybe just somewhere near the safety would be good enough?
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Thanks for the confirmation. You can be assured that coming here to California is the worst mistake you will ever make in your life. Stay very, very far away from here in California; it’s a garbage strewn mess of a State as you said; incredibly horrific, disgusting and the bane of life. Don’t even think of coming here to California. There is nothing to find or see in California that is worth coming here for, California is expensive, ugly and very dangerous; you’re risking you life to come here to California, stay very far away. You’ll be so happy to not even acknowledge the existence of California.
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I’ll call the priest for the last rites.
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As Fareed Zakaria notes, the private sector in California has done well while the governmental sector hasn’t. I am reminded of the French team that came in to help on the planning of the high-speed rail project but left because of the political dysfunction.
DB2
Another Fed website, from the NY Fed, has a forecasting page.
It puts Q3 GDP at about 2.5% as the median forecast, but the forecast error is wide. The model estimates a 20%* chance that Q3 GDP exceeds 4%.
*edit: did my math wrong, should be 20% not 45%
California is a “case study in failed governance.”
Gallup Poll (April 2026):
10% of Americans approve of the current governance of the US Congress.
The current Federal Government begins another $2tril 15 year war. The third lost in the sands war in 25 years.
“dijo la comal a la olla”
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Which problem would you rather have?
Cost overruns in high speed rail
or
New war in the middle east?
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¿No sería olla?
The dude is trying to amp up his conservative street cred so they won’t deport him.
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Verdad lol
I mispell even more often in English, I know the spoken phrase.
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Not much.
Not as much as Ukraine and Russia. Or Syria, Yemen, Sudan…the list goes on. Put them on ignore sweetheart.
That word reminds me of a phrase my teacher told me while I was taking Spanish classes in Salamanca, Spain. We were both adults and she was a smoke show. The reason why she couldn’t date a student…
“Donde tienes la olla, no te metas la p0!!@”
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These are romantic notions… I reacted as early as 1st week of Feb, I asked my wife to come back from seattle, even before break out in King county, (the first breakout in US), and I can tell you, it is not possible to get out. Also, the market rebounded viciously, it is not possible to get out in hurry or get back in hurry.
Even a very professional fund manager will have challenges with this, but an ordinary investor will be free of clutches of emotion and will be able to act precisely is a fantasy notion.
You can get out from a slow bleeding market, but a sharp decline is not something you can get out…
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The Spanish tend to be somewhat vulgar. But it would have been good advice for Bill C.
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No Kidding!
“Wiped out more than 16,000 construction jobs”
“Cost govt agencies $450million in lost revenue”
What few understood is the tax applied to commercial and vacant properties. As predicted, developers looking to exit a project after a few years, they could no longer justify the after tax numbers. As a result, there is declining appetite by builders with threadbare margins that have to pay an additional 4.5-5% in taxes at the time of the sale.
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