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4 Years Until The Next Recession? Not Likely!

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Submitted by Lance Roberts of STA Wealth Management,

 

 

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Wed, 08/27/2014 - 17:36 | 5151313 Cattender
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We're DONE Having Recessions..

Wed, 08/27/2014 - 17:46 | 5151344 ilion
ilion's picture

Europe will fall into severe recession, again. Article here.

Wed, 08/27/2014 - 22:27 | 5152363 Spine01
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The article is wrong, it makes the unacceptable mistake of assuming that the economy is a stationary system, when making comparisons. The extraordinary liquidity injections by the FED have made that a HUGE mistake.

The only reason for the current stock prices is way too much money chasing after way too few valuable liquid, reliable assets. Henceforth the crowding even in the unreliable asset category.

Wed, 08/27/2014 - 18:19 | 5151491 Cattender
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yep.. No More RECESSIONS.... just a Continuing DEPRESSION. it should end sometime in the next.. ah, what 15 Years? (Maybe)

Wed, 08/27/2014 - 18:22 | 5151499 Uber Vandal
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That is a very astute observation.

Much like Panics later became Depressions, and Depressions later became Recessions.

I would presume the next buzz word will simply be "negative growth" or, it will simply not be talked about at all.

Wed, 08/27/2014 - 18:34 | 5151541 ShrNfr
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Yep, 'Ol Hopey Changey & the Fed fixed that one fer good. From now on, we will only have depressions.

Wed, 08/27/2014 - 18:40 | 5151561 Berspankme
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My sales aredown 20% YOY and last year was a 6% YOY drop. Sure hope we don't have a recession. I have strictly discretionary income product

Wed, 08/27/2014 - 17:45 | 5151339 Cognitive Dissonance
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If "they" accurately reported inflation (and unemployment) it would be obvious we are still in a depression.

Wed, 08/27/2014 - 18:01 | 5151409 JustObserving
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John Williams (www.shadowstats.com) provides inflation estimates based on previous official methodology when the Consumer Price Index still represented the cost of a constant standard of living. The 1.26% inflation measure used to deflate first quarter nominal GDP is unrealistic, as Americans who make purchases are aware.

A reasonable correction to the understated deflator gives a much higher first quarter contraction. The two main causes of inflation’s understatement are the substitution principle introduced during the Clinton regime and the hedonic adjustments ongoing since the 1980s that redefine price rises as quality improvements. Correcting for excessive hedonic adjustments gives a first quarter real GDP contraction of 5%. Correcting for hedonic and substitution adjustments gives a first quarter real GDP contraction of 8.5%.

Realistic economic analysis is a rarity. The financial press echoes Wall Street, and Wall Street economists are paid to help sell financial instruments. Gloomy analysis is frowned upon. Even negative quarters are given a positive spin.

Years of understatement of inflation has resulted in years of overstatement of GDP growth. Thinking about the many years of misstatement, we realized that the typical computation in nominal terms of the ratio of debt to GDP is seriously misleading.

http://www.paulcraigroberts.org/2014/07/08/deteriorating-economic-outloo...

Wed, 08/27/2014 - 18:03 | 5151417 saveUSsavers
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1.4% deflator, folks ! That should be criminal fraud

Wed, 08/27/2014 - 18:40 | 5151536 Cognitive Dissonance
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That is criminal fraud. Of course the criminals have no incentive to prosecute the criminals so...........

<No harm (to fellow criminals) no foul. And if there is a benefit? Well.......>

Wed, 08/27/2014 - 18:35 | 5151545 ShrNfr
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That is always the problem with those blow up sex dolls. After you use them you gotta deflate'er.

Wed, 08/27/2014 - 17:48 | 5151348 NoDebt
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Late 2016, near the end of Obama's presidency, is the next most likely time the wheels will fall off.  Then you'll see Obama is just another banker bitch-boy, and the bail-outs will begin anew.

Wed, 08/27/2014 - 17:58 | 5151398 Bossman1967
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dammit so I have to survive another 2 years of doldrums sales that sucks I want it now so we can rebuild this monster!! but I guess can wait untill they can tell the truth your normall middle class person is depressed and the free loaders are free loading how can they be unhappy and the crooks just keep on stealing and printing.

Wed, 08/27/2014 - 18:08 | 5151440 NoDebt
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Oh, no, you misunderstand.  It's not going to get better after that happens.  It's going to be a year of terror followed by something a lot like the last 5 years all over again, except with more graft, corruption, cronyism and money printing than we have now.

The one thing you WON'T get is anyone having a sudden moment of clarity and "telling the truth to the middle class."  If you live to be 100, you will never see that happen.  A giant asteroid could be hitting the planet tomorrow morning and they'd tell you everything is fine and things are looking up. 

Wed, 08/27/2014 - 19:01 | 5151644 LooseLee
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Ha, ha. Cute. MF's in charge (Washington & Wall St.) WILL be held accountable---going all the way back to August 1971. Think you can hide? Think again!

Wed, 08/27/2014 - 17:47 | 5151352 TheFourthStooge-ing
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So the depression we've been in for the last seven or so years should be ending before then?

Wed, 08/27/2014 - 17:49 | 5151359 NoDebt
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Recession within the larger depression.  Think 1937.

Wed, 08/27/2014 - 18:19 | 5151485 novictim
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Agreed.  Stooges point is that there never was a recovery in the real economy so all this predicting of a next recession overlooks the real depression we are already in.

What we have seen is the consolidation of wealth into the hands of a small elite who are then misusing the capital to bid up the stock market. 

The confusion is all about the decoupling of real business operations and consumer activity from perceived values by the investor-gambler class.  It seems that a lack of any business success fails to influence or connect to stock price while perceptions of stock price can immediately collapse a business.  It is all very dangerous and perverse.

Meanwhile...

Others here talk of a liquidity trap situation and I think that this is the key problem (lack of real confidence) along with the worsening of wealth inequality which is directly connected here.  The world needs a total reset.

Wed, 08/27/2014 - 18:29 | 5151531 centerline
centerline's picture

Marginal utility of debt has gone pppphhhhhhhhhttttttt.  Game over for this go-round of historical predatory human behavior.

The real kicker here is that the run-up, fueled by cheap energy and technology, was spectacular.  When the ugly lights come on, the hangover is going to be a bitch.

Wed, 08/27/2014 - 17:50 | 5151365 RadioactiveRant
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Its pointless looking at historical charts for guidance when policy interventions (ZIRP/QE) are unprecedented.Central Banks have created a Keynsian liquidity trap, they're out of ideas and running out of time.

Wed, 08/27/2014 - 18:11 | 5151453 NoDebt
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To be fair, they only ever had one idea to begin with:  Print money and hand it to the banks.  Plans B, C and D are just slightly tweaked versions of plan A.

Wed, 08/27/2014 - 17:55 | 5151384 Rompoculos
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I'll bet he's stacking gold and paying for it with his muppet juicer set on LIQUIDATE.

Wed, 08/27/2014 - 18:09 | 5151425 GooseShtepping Moron
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Man, there's a plethora of interesting threads up today and unfortunately I can't really take the time to read or comment much; there are too many other things I've got to get done; but here's a quick gloss on the subject matter above.

We should all keep in mind that the folks who are actually rigging the market (central bankers, TBTFers, prop desks, etc.) understand the historical econometric patterns just as well as anybody else, and are probably not to be outdone by asset managers with a writing bug (much as I prefer the latter). They studied all the same textbooks and attended the same classes with the same professors, and they look at the same data. It isn't that the riggers lack the proper market understanding; on the contrary, it is on the basis of this very understanding that the rigging proceeds. They receive and interpret the signals the market is sending, they know what "ought" to happen, then they intervene in just such a way so that what ought to happen doesn't, meanwhile arbitraging the spread between what causality dictates and what diktat causes. This is classic Nashian "fuck-your-buddy" game theory: whatever rules someone else is following, break them to your advantage if you have the power to do so.

Therefore, we should not be surprised that the market seems to hover forever in an unprecedented twilight zone of counterintuitive behavior. This is both the intended effect of the rigging and the evidence thereof. All this is quite destructive in the long run, but Keynes (who, like Nash, interned at the firm of Brokeback Capital Partners) has taught the current generation not to worry about that anymore. Fuck your buddy, indeed.

Wed, 08/27/2014 - 19:07 | 5151660 LooseLee
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They and their offspring will be held accountable. NO ONE who perpetrated this human denegration will escape the wrath of JUSTICE---NO ONE!

Wed, 08/27/2014 - 18:16 | 5151431 lester1
lester1's picture

Wow I dont even know where to begin how far off this article is..

First of all in the 1990s there was not job outsourcing on steroids like there is today. I recall in in 1998 opening up the newspaper and seeing dozens and dozens of good paying tech and manufacturing jobs. All of that is gone thanks to sellout politicians who cheerlead for free trade and globalization.

 

Second, there is no recovery currently going on. Its all fake. Its all QE and ZIRP driven. So you remove the stimulus and the stock market and the economy will crash. 

Third, its amazing how many so called expert economists fail to see that we still have 40+ million people on food stamps and huge trade deficits. There is no recovery!!!

Wed, 08/27/2014 - 18:25 | 5151510 novictim
novictim's picture

Well said.

Wed, 08/27/2014 - 18:24 | 5151515 centerline
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I think the Tylers are likely just parading these guys around on a daily basis with the intent of exposing them as nothing more than what they are... snake oil salesmen.  False prophets.  And outright liars just talking their book.

FIRE sector = LIAR sector.  Enabled by bought and paid for politicians, judges, etc.

The internet is truly dangerous and magical at the same time.  Isn't it?

Yeah, I also think the Tylers have an axe to grind - and an angle.  But, hey, bias is everywhere.  As long as we think for ourselves and conduct our own due diligence...  okay then.

But, I have to say that I am more cynical these days after the sudden slam on so many accounts a couple of years ago.  Censorship of any type is a real concern of mine... especially for a place called Fight Club which now feels more like Hug Club.

 

Wed, 08/27/2014 - 19:10 | 5151671 LooseLee
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No. ANYONE singing the Status Quo Song (There is a recovery) are AIDERS & ABETTORS. They WILL be held accountable for their WORDS & DEEDS...

Wed, 08/27/2014 - 23:35 | 5152530 daveO
daveO's picture

Amen. $1 Trillion of QE = 5.82% of outstanding national debt. Tapering it, in an already debt deprived economy, ought to be the shock of the century. Go directly to jail, do not pass go.

Wed, 08/27/2014 - 18:17 | 5151480 Duc888
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  Cog Diss: If "they" accurately reported inflation (and unemployment) it would be obvious we are still in a depression.

 

What did Yellen call it?  "Noise"?

 

Wed, 08/27/2014 - 18:37 | 5151551 Cattender
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LOUD FUCKING NOISE.. (around here)

Thu, 08/28/2014 - 09:45 | 5153405 moneybots
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"What did Yellen call it?  "Noise"?"

 

Noise is what comes out of Yellen's mouth.

Wed, 08/27/2014 - 18:56 | 5151620 himaroid
himaroid's picture

Right on time! This piece marks the date of rosie's annual 180 degree turn in opinion/outlook. A better show and more reliable than the Perseid Meteor Shower. 

Wed, 08/27/2014 - 19:00 | 5151634 starman
starman's picture

Ford has a recovery special sales on all models for

0% for 72 months! Let me repeat that 0% for 72 months!

Recovery!  

Wed, 08/27/2014 - 21:24 | 5152128 malek
malek's picture

Why do I always have to think of "a permanent high plateau" when I read such articles?

Thu, 08/28/2014 - 00:55 | 5152640 redc1c4
redc1c4's picture

as others have said previously, talking about the "next recession" is bullshit, because we've never gotten out of the last one.

welcome to Obamamerica.

Thu, 08/28/2014 - 09:44 | 5153384 moneybots
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" Deregulation was eventually a disappointment even to Greenspan, shocked at the bad behavior of financial leaders who, incomprehensibly to him, were not even attempting to maximize long-term risk-adjusted profits. Indeed, instead of the 'price discovery' so central to modern economic theory we had 'greed discovery."

 

Got a bridge in Brooklyn for you to buy.  Deregulation was no disappointment to Greenspan, nor was Greenspan shocked by bad behavior of financial leaders which mimicked his own bad behavior.

In 2005, Greenspan praised bankers for getting people who otherwise would not have been able to have afforded a home, into one. The previous September, the FBI had warned congress of massive mortgage fraud.  It was already obvious to Greenspan in 2005, how bankers were getting people whoo could not afford a home, into one. Massive banking fraud.

Greenspan pretended to lament that he thought bankers would have been more responsible, but Greenspan was warned within the FED in 2000,  that he needed to tighten lending standards. Greenspan refused to do so.  The bankers followed Greenspan's lead of recklessness and Greenspan praised their recklessness in 2005.

Greenspan lead the way.

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