I've been reading that the two consecutive quarters of negative GDP growth in Q1 and Q2 of 2022 do not necessarily indicate a recession. I understand that the labor market is tight, but I'm not sure how that relates to the definition of a recession. Could you please explain why two consecutive quarters of negative GDP growth do not always mean that we are in a recession?
You can’t have a recession when the consumer is this strong and this relentless.
The average U.S. consumer is healthy across a broad range of qualitative and quantitative metrics. Wage gains have been meaningful the last few years, while unemployment is at multi-decade lows. And the wealth effect is gaining momentum right now because people’s homes just appreciated a lot in value at the same time stocks in their retirement accounts went up a lot!
So… assigning a recession because of two sequential quarters of negative GDP growth feels very arbitrary to me. Growth at any given time in the can be choppy - even if the longer trend is up.
Which end of day Gold price are you using??
Gold futures - currently the December contracts and take the price at 4pm, or as close as possible.
Hi Blake,
I've been reading that the two consecutive quarters of negative GDP growth in Q1 and Q2 of 2022 do not necessarily indicate a recession. I understand that the labor market is tight, but I'm not sure how that relates to the definition of a recession. Could you please explain why two consecutive quarters of negative GDP growth do not always mean that we are in a recession?
Thanks,
Mike
You can’t have a recession when the consumer is this strong and this relentless.
The average U.S. consumer is healthy across a broad range of qualitative and quantitative metrics. Wage gains have been meaningful the last few years, while unemployment is at multi-decade lows. And the wealth effect is gaining momentum right now because people’s homes just appreciated a lot in value at the same time stocks in their retirement accounts went up a lot!
So… assigning a recession because of two sequential quarters of negative GDP growth feels very arbitrary to me. Growth at any given time in the can be choppy - even if the longer trend is up.
Appreciate the question.