VALIDITY OF THE RECESSION TALK

If a recession is suddenly announced in USA, and if the first quarter GDP really does come in as dramatically down, tariffs and therefore Trump will find itself targeted for blame.

-  Jeffrey A. Tucker

This should be a primary political concern for the Trump administration right now. Jeffrey A. Tucker says that there is strong reason to believe US has been in technical recession plus high inflation for years now. Admitting it now is simply a matter of political timing.

Just like clockwork, there is talk of recession in the air. The announcement will come soon and be confirmed by summer. The Atlanta Fed just revised its output forecast for the first quarter to expect a contraction at -2.8 percent. This is very sudden. Only a week earlier, the same tools (GDPNow) had forecast a 2 percent increase in output in the first quarter.

At this point, many people are probably dismissing all these forecasts and big numbers emanating from experts on the public payroll. They have been wrong about so much for so very long. And yet, Wall Street is moved by such data reports, even when the problems with them are so obvious. As they say, the numbers might be fake but they are all we have.

The basis on which this forecast is being made concerns construction spending, and it is truly hard to justify based on industry numbers showing no such thing.

My own thinking: this is a game of catch-up and blame placing. Analytics commissioned by Brownstone Institute—but which can also be intuited by any living adult over the last four years—documents a technical recession since 2022 based on a clearer reading of the best data. Even then, there was never a clear recovery from March 2020 when the global economy was deliberately plunged into a forced depression. Since those days, not much has made sense in macroeconomic data as conventionally collected and distributed.