Are you frustrated by the constant forecasts of an imminent recession? If so you aren’t alone. For months now experts have marched to the sound of a mantra that a recession is unavoidable and we should all hunker down while looking for pennies down the back of the sofa.
The problem is that the claims are at once, wholly wrong and largely irrefutable.
Lets start with the irrefutable.
There will always be recessions as long as we are human. The only question is when will these pullbacks in economic activity occur? Anyone predicting an unavoidable recession in 2002 would have been correct. They are always unavoidable. But in that case it took until 2007 for it to arrive. In other words, the U.S. enjoyed a boom time for another five years.
Now I don’t know if we have another five years of growth this time, but I do know how to read the economy. And in this case, it still doesn’t look like one.
For instance, online sales on Black Friday raked in a staggering $9.1 billion, up 2.3% from 2021, according to a report in CNBC.com. Electronics were a big contributor, the report states.
- “[H]ottest items included gaming consoles, drones, Apple MacBooks, Dyson products and toys like Fortnite, Roblox, Bluey, Funko Pop! and Disney Encanto.”
It seems clear that luxuries like MacBooks and Dyson gadgets don’t really fit with the lack of optimism we see during an economic pullback. If you really thought your job was in potential jeopardy, would you go splurge on big ticket items that were desires rather than needs? Probably not, I would suggest.
Other things look good for America.
Winter heating bills likely won’t be anywhere near as high as some people feared as a forecast shortened season will bring relief, especially when compared with last year.
The U.S. unemployment rate is a modest 3.7%, according to TradingEconomics.That’s lower than where it was in February and before much of the recession calls began in earnest.
It is true that the tech sector is undergoing some issues which have resulted in mass layoffs. But that’s one sector.
Do you think mass firings suddenly descend on the energy sector which is going gangbusters? Or the defense sector which is making armaments as fast as they possibly can, both to help arm Ukraine, and to bulk up capabilities for a possible conflict with an increasingly belligerent China? I think not.
No, this news from Black Friday strongly suggests that “the imminent recession” is still nowhere to be seem except in the minds of people who want one.
Source : Forbes