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We Are Probably Already In A Recession
Indeed, a lot of people are always warning about recessions; however, that doesn’t mean we won’t ever have recessions. The most recent recession of early 2020 was papered over with massive stimulus. People had more money, which is not what we would call a “recession”. At the very least, we wouldn’t say that malinvestment was sufficiently cleared out.
The reason economists are predicting a recession soon is that inflation is out of control. Interest rates are going up in response to that. When interest rates go up, historically speaking, a recession is around the corner.
The recession is already here
But we could already be in an official recession. An official recession is defined as two consecutive quarters of negative GDP, and we just had a quarter of negative GDP. Thus, we won’t know for certain whether we are already in a recession for months — GDP numbers operate with a lag.
The reason some economists are confident we are already in a recession is multifaceted. For one, as mentioned previously, inflation and interest rates are flying high. For another thing, the official unemployment rate is already super low. A low unemployment…
