Comment by themafia
4 months ago
> And yet despite those warning signs, there has been nothing even remotely resembling an economic crash yet.
Well... define "economic crash."
The outputs no longer correlate with the inputs. Is it possible it's "crashed" already? And is now running in a faulty state?
This is how I'm starting to view many of these things. It's just that the metrics we use to evaluate the economy are getting out of sync. For instance, if "consumer sentiment is at Great Recession levels", why do we need some other indicator to accept that there's a problem? Isn't that a bad thing on its own?
"Bad" is a judgment call. Trump approval ratings haven't dipped that far, so Congressional Republicans won't dare abandon him and there's not much political will for change.
It might change if we get into millions of foreclosures like the great recession and the pain really hits home. From what I can tell right now they're in wartime mode where they just need to buckle down until Trump wins and makes other countries pay for tariffs or something.
Trump only started at 49% approval rating and is currently at 40%. If you consider this as not having "dipped that far", it can only be because it was never high to begin with, although I think an 18% difference is significant.
The economy is great for oligarchs, especially those close to Trump. Congressional politicians generally serve the same masters. Regular Americans do not feature into the equation. We will not as long as the same people are in power. Regular Americans are, of course, feeling it. One spot is at the supermarkets. Food prices are up month to month and particularly year over year (moreso than the historical average).
https://news.gallup.com/poll/203198/presidential-approval-ra...
https://www.ers.usda.gov/data-products/food-price-outlook/su...
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We're definitely not in a crash yet, but it does feel like we're the roller coaster just tipping over the peak: unemployment is rising for the first time in a couple years, there's basically no GDP growth apart from AI investment, and the yield curves look scary. The crash could be any second now, especially because tech earnings week is coming up and that could indicate how much revenue, or lack thereof, the AI investment is bringing in.
So the crash is only official once Wall Street's exuberance matches the economy as perceived by it's workforce? Is that a crash or just a latent arrival of the signal itself?
Yeah; in general it's very difficult to detect the economy going off the rails _in real time_; it tends to be clearly visible only afterwards. It's entirely possible we're already past the point of no return; this cycle's equiv of the Lehman Brothers collapse (if there even is such a clear signal, and there isn't always) could happen tomorrow.