I think Sophie and I will be proved right

The most reliable indicator of a recession, the yield curve inverting was already a thing more than a few months ago. The stock market is just the icing on the cake and the signature and the date for the clear signal that we'll be going into a recession. It's only inevitable.

Unless you mean to suggest that the Fed yield curve didn't actually predict the last 60 years worth of recessions consistently? @sɪᴅɪsɴᴏᴛʜᴇʀᴇ

@Shockwave The yield curve isn’t a mechanism that predicts a recession, as in a recession will happen if it inverts - this isn’t true. It’s mainly a warning sign to act, if the FED lowers interest rates and takes action the impending “recession” will not come.

@Hollow Vagabond Back to normal

Okay, you're ripping a Ben Shapiro and stating to obvious expecting me to give you the dub for the argument over changing the entire narrative of what I was saying.

Note that historically, for 6 to 7 decades there was a recession on average 24 months after the yield curve inverted. Every time.

Is it cause and effect? No, but you must admit that this is consistent enough to spark confidence in the common coincidence following such a phenomenon.

@Shockwave In this case it’s different, the yield curve isn’t saying there will be a recession but signalling action must be taken.

It’s what the federal reserve did; hence a recession is not probable anytime soon.

Time will tell. Given the rapid loss of spending I expect we will see the mist rapid recession in US history. Our economy is built on spending and pretty much all spending except for a handful of specific items has essentially dried up.

It’s not so simple.

Its if Bloomberg becomes president we will have a better minimal wage but prices will go up only good for a short time we’ll only get dried up slower

@DrYuriMom The dow jumped 2k.

@Baphomet The business cycle doesn't mean "Capitalism" will collapse.

The trend of growth is upwards, i.e GDP is trending upwards despite the troughs.

Profitibality margins are down however

Not exactly.

You're referring to the 'falling rate of profit'? It's measurements are wrong.

And you forget that capitalism creates the tool of it’s own demise; by uniting workers in a common cause

What would that mean?

@sɪᴅɪsɴᴏᴛʜᴇʀᴇ Once profitibality reaches 0 what will happen

You have to admit society evolves

Society goes through stages

Do you think capitalism will last eternally?

The issue with the graph you sent is, it relies on fixed capital only. Over a long period this is a significant difference as technological progress usually increases the amount of fixed capital used in production. In the past the capital needed to create the output was much more simpler than now. This means that measuring fixed capital isn't an valid way to measure all capital; in the past circulating capital was a larger part of the total. So, by not counting it the profit rates attributed to the past become higher.

@Baphomet

Infact, the real rate of return has fallen by 0.5 to 1 points per year since ~1400 CE. So if there truly is a Marxian rate of profit decline, it's occurring *damn slowly*.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3485734

SINT, I never mentioned the DOW. The economy is much bigger than the stock markets. And equating daily fluctuations of the stock market to the overall health of the economy is to argue that weather is climate. They are associated but they are different, and the latter influences the former and not the other way around.

People are not spending money in an economy that is 70% consumer spending.

Travel, cruises, movies, restaurants, etc have all plummeted. People are already being laid off. People affected, and those worried they are next to be affected, will not spend.

And then there are the trillions of corporate bonds that stand ready to explode if this does not resolve in the extremely near term.

Oh, and the break down of trade. Nations proclaiming bans on exports. Nations who have lost the capacity to manufacture.

To argue that a recession is not in the offing is to deny the reality around us. Feb numbers in no way reflect March, and April will be even worse. This is happening faster than any previous recession in history.

Everything is a lagging indicator in a situation like this

And no one can see any end in sight. If we insist on freezing activity until a vaccine is out, that's at the very least next summer.

And that assumes the vaccines being tested actually are effective. I sure hope they are, but this bug has already proven itself to be unique in its hardiness. There are viruses that have proven difficult to vaccinate against. We have no idea how fast the vaccine search will be for this one.

It's not the virus that is the problem, per se. It is our response to it. I'm still rather shocked by it all.

https://www.npr.org/transcripts/815012877

Ok Simp

@DrYuriMom While that's true, it doesn't necessarily mean layoffs. The recent job/jobless numbers aren't indicative of any layoffs *yet* (including the recent numbers from March), but that does make sense as it's temporary. People are actually spending a lot on supplies, i.e toilet roll; food; hand gel and whatever.