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If Past Is Prologue: T Minus 5 Months Until The Next Recession

Tyler Durden's picture




 

Just under two months ago we noted, somewhat comedically, that the Fed's researchers were 'confused' that its models (the wonderful DSGE) pointed to 'explosive inflation' given its current ZIRP regime. Perhaps those same PhDs will also be surprised to note that, based on the 44 month average length 'out of recession', that the next recession (as proffered by the NBER) is due to begin March 2013 (though of course, the resolution of the fiscal cliff and a renaissance in Europe will hold off the next recession forever, right?)...

 

 

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Fri, 11/30/2012 - 14:12 | 3024234 aymankkhlifat
aymankkhlifat's picture

Boehner speaks now : What is the Fiscal Cliff ? http://stks.co/cF8x 

Fri, 11/30/2012 - 14:25 | 3024294 economics9698
economics9698's picture

We entered into the recession last July.  The only thing hiding it is the fiat inflation.

Fri, 11/30/2012 - 14:32 | 3024320 john39
john39's picture

apart from a series of fraud induced bubbles... the U.S. has probably been in recession for decades.

Fri, 11/30/2012 - 14:38 | 3024338 insanelysane
insanelysane's picture

Only from the 1970's on.

Fri, 11/30/2012 - 15:01 | 3024435 Sextus Empiricus
Sextus Empiricus's picture

Why last July?  Interested to know your rationale for that.

Seriously.  Just curious.  I'm curious about everything.

Fri, 11/30/2012 - 15:10 | 3024478 Essential Nexus
Essential Nexus's picture

Where did you come up with your name?  I'm just curious about that.

Fri, 11/30/2012 - 18:49 | 3025301 Sextus Empiricus
Sextus Empiricus's picture

Sextus Empiricus was a philosophical skeptic from the Pyrrhonian school of thought... late BCE

Questioned the ability to rationally prove anything, since every proof required a proof of the previous proof.  And so on.

Fri, 11/30/2012 - 15:12 | 3024484 economics9698
economics9698's picture

Industrial production actually peaked a few months ago, real sales have weakened, personal income has weakened, and despite some divergences among individual reports here and there, the new order, order backlog, and employment components of numerous regional and national Fed and Purchasing Managers surveys have also turned decidedly lower.

http://www.hussmanfunds.com/wmc/wmc121126.htm

http://www.hussmanfunds.com/wmc/wmc121022.htm

http://www.hussmanfunds.com/wmc/wmc121105.htm

http://research.stlouisfed.org/fred2/graph/?s[1][id]=NEWORDER

Fri, 11/30/2012 - 16:13 | 3024728 janchup
janchup's picture

Depending on the fund, if you wanted to lose money or merely have lousy returns for the past 3 years Hussman is the guy you should have turned to.

Fri, 11/30/2012 - 15:51 | 3024639 VirtuousTex
VirtuousTex's picture

There is a good video on Bloomberg with Lakshman Achuthan from ECRI which shows and explains all the big indicators rolling over in July apart from employment.  Lakshman has stated publicly that he thinks a new recession started in July.  A negative GDP print should follow if he's correct.  I think indicators are aggregate: production, sales, income, and emplyoment.

Fri, 11/30/2012 - 17:16 | 3025005 HarryHaller
Fri, 11/30/2012 - 15:06 | 3024458 BandGap
BandGap's picture

We went off the cliff months ago, we just have to watch the gravitation vector take over. As our momentum slows, just how far past the cliff's edge will be evident.

My brother oown a restaurant, inflation started hitting food hard last spring.....and now we'll start to see the bad yields in China show up, forget mentioning the US.

Fri, 11/30/2012 - 14:28 | 3024304 cifo
cifo's picture

Now to beginning of March is 3 months, not 5.

Fri, 11/30/2012 - 14:56 | 3024411 Silver Bug
Silver Bug's picture

We have never really truly left the new depression. They simply were able to make the stock market go up short term by inflating with fiat money. It's a depression if you lost your job and a recession if your neighbour lost his.

 

http://schiffblog.blogspot.ca/

Fri, 11/30/2012 - 14:13 | 3024237 Debtonation
Debtonation's picture

You mean Depression?

Fri, 11/30/2012 - 14:17 | 3024253 CPL
CPL's picture

Double plus ungood comrade, you should be with the proper lingo patter or you will find yourself re-educated.

Fri, 11/30/2012 - 15:36 | 3024571 A Nanny Moose
A Nanny Moose's picture

Requesting permission to be afraid

Fri, 11/30/2012 - 14:23 | 3024284 Sextus Empiricus
Sextus Empiricus's picture

You mean sh*t-storm clusterf*ck?

Fri, 11/30/2012 - 14:24 | 3024288 FL_Conservative
FL_Conservative's picture

What's a little stagflation amongst friends?

Fri, 11/30/2012 - 14:14 | 3024240 FLUSA.com
FLUSA.com's picture

Oooh nice..an Ordinary Recession to look forward to!

Fri, 11/30/2012 - 14:14 | 3024242 docj
docj's picture

Cool! My next salary review is at the end of February - so if this holds I might see a (nominal) increas in my (non-inflation adjusted) salary next year! WOO HOO!

Fri, 11/30/2012 - 14:25 | 3024296 azzhatter
azzhatter's picture

Repeat after me -There is no inflation

 

Cheers, Uncle Benny

Fri, 11/30/2012 - 14:14 | 3024247 Gubbmint Cheese
Gubbmint Cheese's picture

recession started in August imho

Fri, 11/30/2012 - 14:18 | 3024257 CPL
CPL's picture

August 2002?

 

Yes I agree.

Fri, 11/30/2012 - 18:50 | 3025298 TruthBeforeAll
TruthBeforeAll's picture

Can you spot when the recession began on this chart? http://gailtheactuary.files.wordpress.com/2012/03/us-natural-gas-price-i... Hint... it wasn't Sept 11th 2001. It was when people's gas bills doubled and tripled in the winter of 2000 and they had no clue how they were going to heat their homes if they got another bill like the last one. It was at exactly that point that consumer confidence crumbled. Add Sept 11th to the mix and people lost faith in TPTB to protect their general welfare.

Fri, 11/30/2012 - 14:23 | 3024289 Eally Ucked
Eally Ucked's picture

Recession started few years back but if you like fudged numbers mostly consisting of gov. spending and fake profits from financial side then maybe you're right.

Fri, 11/30/2012 - 14:33 | 3024322 ptoemmes
ptoemmes's picture

http://globaleconomicanalysis.blogspot.com/2012/11/ecri-sticks-with-rece...

 

 

Following our September 2011 recession call, we clarified its likely timing in December 2011. Based on the historical lead times of ECRI’s leading indexes, we concluded that, if it didn’t start in the first quarter of 2012, it was very likely to begin by mid-year.

But we also made it clear at the time that you wouldn’t know whether or not we were wrong until the end of 2012. And so it’s interesting to note the rush to judgment by a number of analysts, already asserting that we were wrong.

So, with about a month to go before year-end, what do the hard data tell us about where we are in the business cycle? Reviewing the indicators used to officially decide U.S. recession dates, it looks like the recession began around July 2012. This is because, in retrospect, three of those four coincident indicators – the broad measures of production, income, employment and sales – saw their high points in July (vertical red line in chart), with only employment still rising.
Read more at http://globaleconomicanalysis.blogspot.com/2012/11/ecri-sticks-with-rece...

Fri, 11/30/2012 - 14:16 | 3024252 RopeADope
RopeADope's picture

I see you are a comedian. The U.S. has been in a recession for the past 12 years straight.

Fri, 11/30/2012 - 14:41 | 3024311 chart_gazer
chart_gazer's picture

only the the middle and lower class 

http://www.ritholtz.com/blog/2012/11/real-median-household-income-in-the...

"...we know from Fed and IRS data that the past decade has seen a modest gains in the top 30% of all earners, bigger gains in the top 10%, very significant increases in the top 1.0%, and enormous gains in the top 0.1%".

and for corporations, do you call this a recession?

http://www.businessinsider.com/corporate-profits-hit-new-record-high-201...

wake up america.

Fri, 11/30/2012 - 14:46 | 3024362 RopeADope
RopeADope's picture

That is just hyperinflation hiding in the bank accounts of the top 1%.

Fri, 11/30/2012 - 14:50 | 3024383 MachoMan
MachoMan's picture

Actually, once set in motion, it's the punitive nature of the cantillon effect...  and all of the money never sits there forever...  it's trickling out as a few of the colluders break the pact in secrecy.

Fri, 11/30/2012 - 14:57 | 3024417 chart_gazer
chart_gazer's picture

and corporations.  what is the bullshit that obama was going to be hard on corporations?

http://www.moodys.com/research/Moodys-US-Corporate-Cash-Pile-At-124-Tril...

Fri, 11/30/2012 - 14:40 | 3024340 _ConanTheLibert...
_ConanTheLibertarian_'s picture

I didn't woke up until 2008 but I did always have a feeling that we never really recovered from the 2001 recession. Go figure.

Fri, 11/30/2012 - 14:17 | 3024254 The Gooch
The Gooch's picture

COMPOUND RECESSION?

Fri, 11/30/2012 - 15:18 | 3024512 RopeADope
RopeADope's picture

What do you call the performance difference between compounded obfuscations and compounded problem solving?

Fri, 11/30/2012 - 14:26 | 3024276 docmac324
docmac324's picture

I'm calling it the week of 2/11/13.

 

Fri, 11/30/2012 - 16:00 | 3024671 A Nanny Moose
A Nanny Moose's picture

Stupid Bowl weekend would be far more opportune timing.

Fri, 11/30/2012 - 14:27 | 3024279 docmac324
docmac324's picture

.

Fri, 11/30/2012 - 14:37 | 3024334 Dr. Engali
Dr. Engali's picture

That's an excellent point you made there!

Fri, 11/30/2012 - 15:08 | 3024470 Poetic injustice
Poetic injustice's picture

With recent inflation, every point now should look like ...

Fri, 11/30/2012 - 14:23 | 3024283 I am Jobe
I am Jobe's picture

Screw the term limits. Hanging Time is next.

Fri, 11/30/2012 - 14:24 | 3024292 azzhatter
azzhatter's picture

Never ending recession has already begun. 30 years of credit expansion with destruction of productive capability will do that to ya.

Fri, 11/30/2012 - 14:29 | 3024301 Dr. Engali
Dr. Engali's picture

Again we never left the depression that started in 2000.We had a dead cat bounce as we work or way downward ,but the collapse has continued it's downward trend again.

Fri, 11/30/2012 - 14:59 | 3024423 El Tuco
El Tuco's picture

Yes we are on course although I think it will be accelerated.

http://www.infowars.com/peak-civilization-mit-research-team-predicts-glo...

 

I tell folks if you want to invest in the future make sure you and your kids know how to plant a garden, butcher an animal, shoot a gun or crossbow.

The good times aren't here forever.

Fri, 11/30/2012 - 14:27 | 3024302 Iam Yue2
Iam Yue2's picture

Friday 15th March, Cheltenham Gold Cup Dày in the UK. History shows a strong correlation between traders attending race meetings and seismic ground breaking events.

Fri, 11/30/2012 - 14:33 | 3024318 Bastiat009
Bastiat009's picture

Very very few of the predictions on this site have come true, especially when timed. I will not believe this one even though I believe the economic situation in the US and in Europe and in Japan is dreadful.

Fri, 11/30/2012 - 14:35 | 3024329 Sextus Empiricus
Sextus Empiricus's picture

Spend a year or so at the university and you'll find that the Ph.Ds and those receiving them learn a very narrow interpretation of their craft, continue in that direcition, and then get a job out of school.  From that point on, many of them cease to learn anything and, like most people, just talk about what they already know for the rest of their lives.

They think themselves to be very intelligent, but too often they only know one side of the coin they claim to own.  Sometimes I find it UNBELIEVABLE that economists can be so dim-witted (I didn't even do economics in school, I just decided to do everything).  But then again, they make it up the rungs of the ladder by doing what they are told and being good at what they already know.  Too many know and are taught the wrong things.  It's just that once you're making a fat paycheck, why learn anything new? 

Just keep the system you know going as long as possible because if it collapses, you have no other skill.

Fri, 11/30/2012 - 14:38 | 3024336 Vashta Nerada
Vashta Nerada's picture

No, the recession will be declared next March, only because they are called retrospectively.  As was noted above, we entered in July.

Fri, 11/30/2012 - 14:43 | 3024349 NoDebt
NoDebt's picture

Recession and Inflation need to be renamed, is all.  Too old fashioned.

Recession will now be called "Unique Opportunities".

Inflation will now be called "Bigger is Better".

And monetizing debt will now be called "Increasing Liquidity".  (Oh, wait.... that one alread is)

It's all about messaging, people.  Messaging, I tell you!

 

Fri, 11/30/2012 - 15:06 | 3024461 imbrbing
imbrbing's picture

LOL! Sounds like one of the meetings I attended at work a couple years ago when they let go of 25% of the workforce. The word massaging was fantastic!

Fortunatly for the guys they let go they didn't have to sit through it and hear it. I don't know which is worse, not working, or working for those that can twist

and massage words making you feel like that poker in your a$$ is good for you, and you love it. I despise those people. I want them to look me in the eye, tell me things are bad

and then we can work together and I wont feel so bad for doing so. You fil my head with crock-a-shit and I will despise working for you.

Fri, 11/30/2012 - 14:43 | 3024351 stormsailor
stormsailor's picture

RECESSION 1.625 X 10 THIRTEENTH POWER

Fri, 11/30/2012 - 14:54 | 3024401 Caviar Emptor
Caviar Emptor's picture

Biflationary charts are popping up everywhere. Disposable income: down. Prices paid: up.

Fri, 11/30/2012 - 14:56 | 3024409 StoleYourMoney
StoleYourMoney's picture

Global recession in progress, US recession began July 2012 the negative GDP will make it obvious. 

Fri, 11/30/2012 - 14:59 | 3024428 StoleYourMoney
StoleYourMoney's picture

RBC slashes US Q4 GDP estimate to 0.2%, timberrrrrrrrrr...

Fri, 11/30/2012 - 16:15 | 3024741 janchup
janchup's picture

5 months? According to the old style investors the market should have started dropping a month ago.....soon to recover, recession discounted. Too bad that doesn't work anymore....

Fri, 11/30/2012 - 16:20 | 3024763 earleflorida
earleflorida's picture

juxtapose the timeline between the end of wwi [11/1918] and the beginning of the, 'the league of nations' [late 1919] followed shortly after by the creation of, 'the council on foreign relations' [8/1921], and the subsequent years 1922 up and until the great-great recession? of 1929-31.

now, if you notice we have a lucky 13* years... but what about the 11th? let's start the overlap beginning 2010 shall we. by all calculations the fed's admonition of gold as a hard currency was true back then, but was lost also back then? a paradox one might say, but perhaps a deviate designed, and labelled necessity-- of grand theft robbery magnitude by the great financial wizards of that time! the same masters [commercial and investment bankers... sound familiar?] still in charge today as i pen my thoughts. for the fed cannot print if held to a gold standard that keeps their 'inflation-grease' from seizing up their's and briton's reserve banks printing press!  oh, now that japan has gone totally retarded,... along with the us, and uk! we are in a wwiii axis-cycle that could manifest itself with just the noise of a cashiers check gravitational bounce where the algos interpret as war!?

just sayin my thoughts out loud!  

Fri, 11/30/2012 - 17:44 | 3025102 Lord Of Finance
Lord Of Finance's picture

Past IS prologue. What we have here is the 1970's all over again. We know what brought it to an end in that time. This time is no different. All talking heads on t.v. say that this recovery all depends on housing making a comeback, but we all know that the housing bubble the central planners are trying to reinflate is not really a bubble anymore, but more like a whoopi cushion. It will not make its final and long awaited bloated bellow of air until the bond market parks its fat ass on it.

 

Unlike the 70's though, we do not have real economic growth. We do not have huge trade surpluses, but opposite, and those dollar holdings are not just owed to ourselves. Gold will make its inflation adjusted adjustment, and then some. But those 3 differences I stated above is what we all know will be the difference this time around, from how it ended in 1980. 

Fri, 11/30/2012 - 18:35 | 3025269 dizzyfingers
dizzyfingers's picture

Is recession possible during depression?

Sat, 12/01/2012 - 02:10 | 3026024 nastaking
nastaking's picture

Sony is using its link with the latest James Bond flick to push its newest flagship Android phone, the Feiteng H7100 Android 4.1.

Do NOT follow this link or you will be banned from the site!