These US States Entered A Recession In 2016

Tyler Durden's picture

At the beginning of 2016, a minor war broke out between two intellectual camps: one said that as a result of the collapse in energy prices, the US economy would slide in a recession as the bulk of the states responsible for job gains under Obama were the same ones that would get crushed with oil plunging. The opposing camp - which boasted Janet Yellen at one point - vociferously claimed that sliding oil prices are great for consumers and with thanks to the extra purchasing power, the US would not only avoid a recession but prosper. One year later we look back to see which, if any, of the two camps was correct.

As it turns out, the truth was in the middle, because while the US in total may have avoided an economic contraction (at least according to the NBER), numerous states did in fact enter a recession.

Based on new research by Kansas Fed Economist Jason Brown, several states suffered severe downturns as of the third quarter of 2016 that hampered growth nationwide. According to the report, Kansas, New Mexico, Oklahoma and Wyoming experienced recessions last year, while others saw milder contractions, including Maine, Montana, North Dakota, Louisiana and West Virginia.

As noted first by Bloomberg, Brown said a ripple effect from the decline in commodity prices hit the oil- and coal-dependent states particularly hard, leading to economic contractions as local governments such as Oklahoma cut back on spending. 

The findings also underscore the growing sense of economic inequality in the nation, as data compiled by Bloomberg show states like Washington and Massachusetts grew well above the national average last year. They saw employment climb as joblessness expanded in Louisiana, Oklahoma, Wyoming, North Dakota and Alaska.

 

These "mini recessions" may have had far greater political implications than previous expected: of all the states mentioned that experienced some degree of economic downturn, only New Mexico and Maine supported his rival, Hillary Clinton.  Perhaps it was sheer luck, or an active analysis of which US states are in the more dire of economic straits, but Donald
Trump targeted his campaign to voters "left behind by the economic
recovery", pledging after his win to help Americans he called “the
forgotten men and women of our country," and which were found mostly in the contracting states. He won.

To be sure, as Bloomberg notes, identifying recessions at the state level isn't an exact science, as there’s no single authority that does so. Further complicating matters is the fact that data on GDP is published with a longer lag than at the national level.  So, to come up with his findings, Brown took monthly, state-level data on economic activity from the Philly Fed and ran two different statistical models, for two periods ending in September 2016. There's not enough information to say definitively whether states are out of recession just yet, he said.

Other researchers have found similar results. In January, S&P Global Ratings said that six of eight major oil-producing states fell into recession in 2015 and 2016, including New Mexico, Oklahoma and Wyoming. The report also shows Alaska, Louisiana and North Dakota entered recession and that North Dakota went from the fastest growing state in 2014 to the worst performer in 2015.

Finally, since the states that S&P and Brown said were in recession represent 4.4% of U.S. GDP, their downturns “certainly” affected national growth.

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Rusty Shorts's picture

Tennesse is on fire right now, haven't seen new construction like this since, well since 2008...

Rusty Shorts's picture

Trump just left Nasville, bound for new Orleans...

stizazz's picture

That endless recession that America enters every year is like HOTEL CALIFORNIA.

You get in but you can NEVER leave.

The CURSE won't let you.

http://biblicisminstitute.wordpress.com/2014/07/17/is-america-cursed/

lexxus's picture
lexxus (not verified) stizazz Mar 17, 2017 8:10 PM

Good analogy.

ceilidh_trail's picture

You're talking to yourself again...

hope_talk's picture
hope_talk (not verified) ceilidh_trail Mar 18, 2017 7:10 AM

I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do... http://bit.ly/2jdTzrM

Sanity Bear's picture

I'm making $8k a month hunting down spammers and selling their severed testicles to the highest bidder on eBay.

TriggerFinger's picture

Nashville and Middle TN booming for sure

August's picture

Same thing in Auckland and all the "high-end" resort areas of NZ.

Nothing like a sugar high to do a body good!

Bigly's picture

CT is shitting the bed, regardless of these numbers. Especially non-fairfield cty

JB Say's picture

Look at the stagnation in the upper midwest. Thats where the election turned.

Johnny Debt's picture

The folks who use racist derogatory terms on this site are paid agitators/trolls used to discredit valid points made here. Disassociate your self and don't fall for the liberal trolls on here. As if Libertarians and Republican-minded folks cannot be non-white. 

TRM's picture

I've thought the same myself. It is so obvious (the joke followup to your comment not withstanding). Trying to get the whole board labeled as racist so that they can lower the boom on ZH and other sites. I've seen it other places as well. Probably the same leftard paid trolls.

Bureau of compliance's picture

What do you get when you line up 4 Mexicans, a Chinaman and 4 African Americans?

 

                   A lawn sprinkler.                                              

 

spik spik spik spik chink nigga nigga nigga nigga

Ban KKiller's picture

Yes, in the eyes of the bansters we are all niggers. Division of the people works! 

Tiwin's picture

Perhaps it is more accurate  to say we are all Palestinians now.In the eyes of the banksters

Sledge-hammer's picture
Sledge-hammer (not verified) Mar 17, 2017 7:34 PM

We ain't seen nothing yet.  When Reagan took over Carter's et al disaster, it took two years before there was any tangible improvement in our economy.  Things will get much better, but it will take time.  And, do not forget that our Glorious Leader is fighting a many-headed (((Hydra))) that hates and despises him with all of their soul (if they had a soul)--a figure of speech.

tripletail's picture

Seriously? The US has been in a depression for the past decade or more. Get a clue, ZH!

Smedley's picture

They close their eyes every time they drive by all those dead shopping centers and strip malls!

See, it's recovery now!

:D

Cassandra.Hermes's picture

I enforced three days a week in my office and productivity went up 14%, millennials are amazing, you told them you need them just 3 days and they'll do 40hours hard work in three days :-) instead of 40 hours socializing in 5days.

froze25's picture

They do like that 3 day 36hr week

CJgipper's picture

I do too.  When you hit 5x12 or more, productivity goes in the shitter, at least for me.  "Why rush, you're stuck here anyway."

max2205's picture

34 years of terrible management 

DendroReality's picture

THIS ARTICLE IS ENTIRELY FALSE. THERE ARE NO VALID GOVERNMENT STATISTICS ANYMORE.

Haven't been for 35+ years.   FOR THE BEST AVAILABLE ECONOMIC DATA SEEE http://shadowstats.com

There has  been no economic recovery at all in the last 35+ years.  It's been all downhill.

 

undertow1141's picture

One 2016 dollar has the buying power of $0.18 in 1973 dollars. They can say the economy has been going up, but up in numbers, the value has shrank every year. This is what they don't want people to realize.

Ban KKiller's picture

Yes, I explain....things don't cost more, your money is worth less. OR what can you buy for just a penny? For just a nickel? Just a dime? Those coins are now mere fractions, worthless on their own. Most folks can understand this...

mary mary's picture

The Endless Recession began in 1913.

SillySalesmanQuestion's picture

This post was brought to you, courtesy of the BLS & the Atlanta FED.

S/

anticultist's picture

 

 

the wreck real estate short etf REK looks like a good buy to close that one breakaway 

 

gap at 17 soon.

 

 

I had one pilot position to add to now.

 

Will wait for some general market correction I hope for by late Apr to buy the ROBO.

 

 

the $15 min illegal to work wage that is $30 after tax and regulatory wastess

 

reduces payback on a $1M robot from 10 to 6 years and 

 

that will be self fulfilling as economies of scale bring the automation prices down with the 

 

growth. that is a karmic consequence of unemployable libtard gender confused 

 

snowflakes with obamacide unemployable socialist tuition debt.

 

 

Remember austrian economics, growth is deflationary, only capitalism creates more for 

 

less abundance.

 

opposite the federali socialist deep state corporations, housing, medical.

 

Funny the ignorant never tried the constitutional natural law even once.

 

 

Real estate to crash this year already is in the deep state corporation jurisdictions. Democrat tv prostitutes buy a 15M property, get a  55,000 property tax in satanist jurisdictions that are cutting public pension 50%,  then the property crashes to $5M. Politicized oberman ESPN to lay off 1/2 staff and "personalities" on leftist crash. should work good in the apartheid ghetto california What happened did the cannibal parasites run out of white trash labor to tax? Why wouldnt they just go to Venezuela and eat the zoo animals just for solidarity with socialists to the voidance of the perjury or appearances of hypocrites. Satanism equals Karmic Consequence, its providence.

 

 

 

Generally I am on board with Armstrong the collapse is terrorism/socialists and

 

not the productve assets so stocks are relatively safe relative to cannibal parasite debt collapse.

ajkreider's picture

ND?  Oil

LA?   Oil

OK?  Oil

WY?  Minerals

 

Notice the lack of non-extraction states.  Non story.