The stock market is down 560 points as of 3:30 pm on the news that we are definitely in a recession. T It will be difficult to make this into good news, but the media is making a gallant effort to try.
After pretending for months that there is no recession or serious inflation, the media has flipped the script. They now want to convince you a recession is a good thing. Washington Post published an article that tells you seven ways a recession is good for you financially (as stocks plummet today). You just can’t make this stuff up.
If you think Joe Biden is a good President, you haven’t seen your 401k lately, haven’t been to the grocery store recently, nor had any home repair needs, and don’t have eyes. Maybe you’re brain misfired. This is the worst administration in our lifetime. It’s even trying to start a world war.
The combined GDP and GDI data were released today. The GDP/GDI was down -0.4% in Q1 and -0.3% in Q2. This means the economy was in a recession during the year’s first half. Janet Yellen changed the definition of recession to fool distracted Americans, but this cements the fact that we are in a recession.
The Biden financial experts told us to ignore the GDP and watch the GDI. So here we are, and it is a recession.
3.) Growth definitely contracted in H1, no more wondering about whether GDP overstates weakness. Even the average of GDI and GDP shows 2 consecutive quarters of negative growth. pic.twitter.com/wZJZYKakrl
— Anna Wong (@AnnaEconomist) September 29, 2022
Beginning in mid-June, we saw a significant bear market rally in stocks. But the recent declines have wiped out those gains and more. For instance, the Dow jumped 14% during the 2-month rally. By the close on Friday, Sept. 23, it was once again down 20% from its all-time high. That same day, the NASDAQ closed just 2% off its June low after a 23% rally, Zero Hedge reported.
As WolfStreet points out, the collapse of this bear market rally was predicated on the fantasy of a Federal Reserve pivot.
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The bear-market rally happened because markets – meaning folks and algos playing in them – had this fabulous reaction to the Fed’s aggressive rate-hike scenario: They began fantasizing about a Fed “pivot” and about rate cuts and some even about QE all over again. Asset prices began to jump, and yields began to fall.”
WolfStreet points out that this bear market rally is reminiscent of the dot-com era. During a similar two-month rally from May 27 through July 17, 2000, the NASDAQ jumped by 33% without ever getting back to its old high. Ultimately, the NASDAQ collapsed by 78%.
That bear-market rally in the summer of 2000 suckered a lot of people back into the market, thinking that stocks would be going to the moon again, and they got crushed.”
The difference between then and now is we have a CPI over 8%.
Wolf Street believes the Feds will tank the economy to get inflation to 2%.
Everything is suffering, housing, food, and car sales. The auto companies are struggling.
Kentucky Ford is filling up parking lots and ammunition lots for Ford trucks that can’t be finished. It’s not just the shortage of semiconductor computer chip issues arising from the supply chain problem. It’s badges, emblems, and other parts.
Inflation is hitting them too.
It’s not only Ford but also Toyota and other car companies.
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