Poll: What is our recession outlook for the US?

[mostlylong]

Using your preferred definition of recession (you know it when you feel/see it), what is your near term outlook for a US recession?

• US is in a recession now.
• A US recession will start in Q3 or Q4 this year.
• No US recession this year.

[PucksFool]

I do not think we will know. I think the data will be tampered with to spin the US economy in the best light possible.

[Leap1]

By September millions will have been laid off and thousands of bankruptcies will have happened. The housing market will have plunged. The bond market might crash depending on the tax cuts.

We are entering a global great depression.

[Hawkwin]

4th option: We will come very close to NBER declaring one six months after the fact, but it will likely feel like one to some starting in the third quarter of this year. I think we could be negative, positive, negative for GDP over the first three quarters.

That prediction (that people feel it) changes to the second (current) quarter if 1st qtr GDP indeed comes in negative especially if more than -2%.

The long backward nature of the NBER pronouncement makes this very prone to speculation and opinion.

[mostlylong]

@Hawkwin

4th option: We will come very close to NBER declaring one six months after the fact, but it will likely feel like one to some starting in the third quarter of this year. I think we could be negative, positive, negative for GDP over the first three quarters.

I’m going with we are in a recession now.

Some data points.

GDPNow forecast says -2.2% in Q1. Is it wrong by more than 2%?

From wall street journal:

In the past three months, economists have changed their outlook for the U.S. to slower growth, higher inflation and greater risk of recession.

…

Underlying the greater likelihood of a recession is a sharp drop in economists’ growth forecasts. On average, they now expect U.S. gross domestic product after inflation to increase in the first quarter of this year by 0.4% on an annualized basis.

On trade (and this is just 1 country):

The effects of President Trump’s new tariffs are starting to be felt across the world, preliminary South Korean trade data suggest, as Seoul prepares to begin negotiations with Washington.

Exports from Asia’s fourth-largest economy fell 5.2% from a year earlier in the first 20 days of April, according to data from South Korea’s customs office released Monday ahead of full monthly trade figures due next week. Imports plunged 12%, leading to a trade deficit, the preliminary numbers showed.

And another:

Chinese port activity slumped in early April, with data indicating that exports to the U.S. have been hammered by President Trump’s tariffs.

The cargo handled by ports across China over the April 7-13 period tumbled 9.7% from the week before to 244 million tons. That’s sharply weaker than the 0.88% loss registered during the previous week, when Trump first announced his plan for reciprocal tariffs.

[Hawkwin]

@mostlylong

GDPNow forecast says -2.2% in Q1. Is it wrong by more than 2%?

Two things: That is of course a forecast and it doesn’t include gold - which I don’t know if it should or not since it didn’t previously. And, recessions are not measured by a single quarter (or even two consecutive quarters) of negative GDP. NBER uses at least a dozen different metrics to come to their somewhat subjective conclusion.

If second quarter GDP is positive, would you still state that we had a recession in the first quarter? I certainly would not.

[mostlylong]

@Hawkwin

@mostlylong

GDPNow forecast says -2.2% in Q1. Is it wrong by more than 2%?

Two things: That is of course a forecast

Yes, and I did write the word forecast.

@Hawkwin

it doesn’t include gold

If the Fed modelers think these gold transactions should be included, that’s good enough for me. I would expect it to not matter much relative to total gdp in the long run.

@Hawkwin

recessions are not measured by a single quarter (or even two consecutive quarters) of negative GDP. NBER uses at least a dozen different metrics

This is why at the start of this thread, I wrote

@mostlylong

Using your preferred definition of recession (you know it when you feel/see it)

@Hawkwin

If second quarter GDP is positive, would you still state that we had a recession in the first quarter?

Sounds like you are asking for more specificity.

I’ll try.

I wrote

@mostlylong

I’m going with we are in a recession now.

We are in Q2 right now, so I guess I was making a statement about today, not using any particular recession definition.

I did reference some latest estimates of Q1 gdp growth (GDPNow), maybe because that’s the latest estimate of the current situation, by that measure.

So I would say I am using “real time” gdp as my measure of recession when I wrote we are in a recession now. But I recognize this is probably not measurable. And for it to be meaningful, it should last for awhile.

Funny how the NBER keeps their criteria fuzzy (they know a recession when they see it).

Overall, I would say our gdp slowdown started in Q1 after new executive policies started to roll out and the slowdown continues today.

And there are data to support that claim, posted above.

When actual GDP numbers come out for Q1, Q2, we can check.

But executive policies might change when we get “deals.”

No one knows.

What do you think?

[Hawkwin]

@mostlylong

What do you think?

Heh. I think as I already stated: negative, positive, negative with no declared recession (based on where we are at this moment with 10% tariffs) - but the market and consumers might react is if we are in one.

That changes if 20% tariffs come back. I think we will have moderate recession in that case. My base case is that those don’t come back.

[WendyBG]

I think in this case the critical issue will be initial unemployment claims, not GDP (whether or not adjusted for gold imports). The Fed will be watching unemployment like a hawk.

Initial Claims

Wendy

[Leap1]

Dear Wendy

Roughing out some numbers there will be more unemployed than the Covid spike.

Greater than 300 employees per small corporation
Possibly 30k closed small businesses
Or divisions of small corporations ended

9 m unemployed by summer 2026

[mostlylong]

Our crowdsourced recession forecast is here.

According to us, the most likely outcome is recession now or in 2nd half of 2025 with majority saying 2nd half.

@mostlylong

• 56% (22 votes) - A US recession will start in Q3 or Q4 this year.

• 36% (14 votes) - US is in a recession now.

• 8% (3 votes) - No US recession this year.

[PucksFool]

and one vote for we won’t have accurate data to know

[Leap1]

Nothing in the spotlight is going to age well.

Trump comments on Fed Chair Powell, trade war with China show he's starting...

[mostlylong]

@WendyBG

the critical issue will be initial unemployment claims, not GDP (whether or not adjusted for gold imports).

Continuing claims takes into account two aspects of unemployment: employed folks becoming unemployed (initial claims) and unemployed folks becoming employed.

When the former increases or the later decreases, indicating less economic activity, continuing claims increase.

The latest from today:

Continuing claims, a proxy for the number of people receiving benefits, rose to 1.92 million in the week ended April 19, the highest since 2021 and a sign that it is taking longer for out-of-work people to find a job. The figure exceeded all estimates.

[mostlylong]

So far, our crowd sourced recession forecast appears accurate.

@mostlylong

Overall, I would say our gdp slowdown started in Q1 after new executive policies started to roll out and the slowdown continues today.

And there are data to support that claim, posted above.

The data says the slowdown continues.

@mostlylong

Continuing claims, a proxy for the number of people receiving benefits, rose to 1.92 million in the week ended April 19, the highest since 2021…

And also:

@mostlylong

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2025 is 1.1 percent on May 1

@mostlylong

That +2.4% GDP growth forecast (yesterday) is all of a sudden +1.4% (today).

That +2.29% contribution from consumers is now +1.31%.

It seems the trend is lower GDP growth.

[Leap1]

Plenty of layoffs in this. A corporation like Apple makes it up somewhere.
We could just have raised corporate taxes to incentivize a factory buildout. We will still need to raise corporate taxes. Meanwhile we will waste a few years.

Apple stock sinks after company warns of $900 million tariff headwind

Apple (AAPL) stock sank late Thursday after the company said it expects to face a $900 million headwind as a result of tariffs in the current quarter. Pressed by analysts on potential tariff impacts beyond its June quarter, CEO Tim Cook declined to comment saying he didn’t want to “predict the future.”