Recession in 2022?

From reader JohnH in September 2022, who now states he “was not cheering a recession in mid-2022”.

…assuming, of course that we’re not already in a recession…following the major economic slowdown! Of course, the Recession Deniers try to not believe the GNP numbers–“Don’t worry; be happy!”

I don’t have a plot of GNP, but here’s GDP and other variables the NBER BCDC focuses on.

Figure 1: Nonfarm Payroll employment incorporating benchmark revision (bold dark blue), implied level using Bloomberg consensus as of 2/1 and December 2023 NFP (blue +), civilian employment (orange), industrial production (red), personal income excluding current transfers in Ch.2017$ (bold green), manufacturing and trade sales in Ch.2017$ (black), consumption in Ch.2017$ (light blue), and monthly GDP in Ch.2017$ (pink), GDP, 3rd release (blue bars), GDPNow for 2024Q1 as of 2/1 (lilac box), all log normalized to 2021M11=0. Source: BLS via FRED, BLS preliminary benchmark, Federal Reserve, BEA 2023Q3 2nd release incorporating comprehensive revisions, S&P Global Market Insights (nee Macroeconomic Advisers, IHS Markit) (2/1/2024 release), and author’s calculations.

Note aside from manufacturing and trade industry sales and personal income ex-transfers and GDP, other series rise throughout 2022H1.


38 thoughts on “Recession in 2022?

  1. Macroduck

    By the way, the response from which Johnny’s “was not cheering a recession in mid-2022” is drawn involved a great deal of other Johnny-mumbling. Readers of comments to will know what I mean. Johnny-mumbling is when Johnny pretends that there is no wider context, that he tells us in a spew of words how to think about things and that’s it.

    Some examples from the same comment:

    “Who knew that the word ‘recession’ was such a politically and emotionally charged word ?”

    Seriously? Johnny knew. Johnny’s political preferences are why he cheered for recession.

    “Instead of the most recent data, Tricky Ducky seems to advocate that we should rely on his preferred unreliable forecast.”

    My preferred unreliable forecasts? Wow! Ignoring the clumsy writing, allow me to remind little Johnny that it is the Fed’s own preference to rely on forecasts. It is the Fed’s own preference to make forward-looking policy. Johnny is apparently happy to “fight the last war” and “drive by looking in the rearview mirror .” Fed officials are not.

    Here’s Mary Daly from March of last year:

    “When things are hard and you’re right in the middle of it, it’s tempting to get caught up in the present—today’s data release, the newest projection. So much so that we can forget to look forward, take stock, and imagine what the future could hold.

    “But policymaking requires it.”

    Or Jay Powell from August of last year:

    “At upcoming meetings, we will assess our progress based on the totality of the data and the evolving outlook and risks.”

    Ben Bernanke:

    “Forecasts are an important tool for central banks to assess the economic outlook.”,light%20of%20major%20economic%20shocks.

    The Fed’s dependence on forecasts is not new, either. Here’s Greenspan:

    “Implicit in any monetary policy action or inaction is an expectation of how the future will unfold, that is, a forecast.”

    Greenspan, 1994, Commenting on a paper by Charles Goodhart

    And before Greenspan, Emile de Girardin, (French Chamber of Deputies at various times from 1834 to 1881):

    “Gouverner c’est prévoir .”

    So you see, Johnny is smply wrong, as usual. He is wrong in trying to claim that this is a clash between mere preferences, mine and his. That’s nonsense. Policy making requires forecasting. Policy makers know it. We know it. Only Johnny seems not to know it.

    See? Johnny-mumbling. It’s what he does because he doesn’t have a legitimate argument. He pretends that he would NEVER let politics bias his views, but that everyone who disagreeswith him is all polotics, all the time. And all the while, he cheers for recession and for Russia to win in Ukraine. He tries to pretend that disagreements are all he-said/she-said, with no room for facts, when the facts all say he’s lying. Johnny-mumbling is a kind of lying with word salad.

    1. pgl

      Mumbling is kind. Incoherent BS is more like it. My favorite part is how he accused you of rewriting what he wrote. One sometimes has to clean up Jonny boy’s incoherent trash as little Jonny boy never learned to write. Besides – Jonny boy routinely lies about what others have said. Heck – this troll lies about what even he has said.

    2. JohnH

      Truly hilarious. Tricky Ducky complains about my using last month’s numbers…but what are forecast numbers based on? A heavy dose of last months numbers projected forward.

      But Tricky Ducky still can’t answer the basic question: with the economy humming along now…repeatedly defying expectations…why should the Fed now assume that today’s predictions are better than yesterday’s? Why should the Fed lower interest rates just when people are finally receiving positive real yields on their secure savings? Why preference wealthy shareholders, who were the main beneficiaries of lowering of interest rates in the past?

      And here’s another question: given the poor performance of the Fed’s ZIRP program, which immediately boosted bankster profits and shareholder wealth, while reducing unemployment and increasing real wages at a glacial pace, why should we expect anything different this time around?

      It sounds to me like the Democratic partisan hacks here, desperate to rescue Biden from his abysmal poll numbers, are willing to pull out all the stops–risking more inflation and reducing real wages by pressuring Powell. Economics be damned…it’s rescuing Biden that is all that matters!

      1. pgl

        And I was accusing Bruce Hall of long winded gibberish. Dude – your ancient version of ChatGPT is almost as retarded as you are. Get an update.

  2. Moses Herzog

    You have to admit one thing, no matter how disingenuous we may view JohnH to be, or how bad an element JohnH is, the numbers were a little vertigo inducing, as you point out in the last sentence of your post. Those 4 you mentioned are pretty important barometers.

    But yes, this is why we have to get the tape measure out, or different tape measures as it were, and measure, and re-measure, and then re-measure the re-measure, and think and re-think and……..

  3. Moses Herzog

    I’m going to a smalltown library book sale tomorrow (Sat) morning., The books are about $1 to $1.50, and sometimes in great condition by great authors. Last year I only scored 1 book though, a Russell Banks book. I almost picked up a James Lee Burke book but it had a raunchy cover and I guess I’m a little shy or a little bit of a prude sometimes so I couldn’t quite take it to the staff for purchase. Uncle Moses is weird in the head sometimes. But you guyzez already knew that, right??

    I will push any 5 year olds to the ground who try to grab a book I want (joke), and then report my results late Saturday night.

  4. JohnH

    How exactly does Menzie get from my comment to the notion that I was “cheering” recession? I guess that’s what happens when somebody merely points out the reality of two quarters of negative growth when others choose to promote more positive numbers—you get labelled as being on the wrong side, espousing the wrong narrative. Horrors! Thou shalt NOT sift and winnow!!!

    Ambiguity shall not be tolerated, even if that’s the obvious conclusion of conflicting numbers!

    That is still true. Amidst all the cheering of great economic results, other numbers point to a barely positive result.

    . But let’s not talk about that!

    1. Baffling

      Actually the problem has been you take ambiguity and demand the conclusion of recession. You argue ambiguity should be accepted as bad performance. That is your flaw in reasoning johnny. Because you desire a negative outcome in order to continue your propaganda. You are not an innocent bystander here johnny. You intentionally promote misinformation on this topic.

    2. JohnH

      According to GDI, economic growth was perfectly flat in 2002. Talk about ambiguity!!! But the Democratic partisan hacks here didn’t notice that! No, the narrative had to be that, borderline recessionary as economic growth may have been, the economy was NOT in recession! Fortunately for them the 3Q results turned out in their favor, though the result was in doubt until GDPNow started predicting an upturn in late August, 2022.

      More objective reporting would have acknowledged the principal takeaway– that economic growth was extremely weak. The second takeaway was that It was ambiguous whether the economy was in recession or not–indicators such as GDP pointed down in H1, others pointed up. Instead, a tremendous amount of effort was put into proving that the economy was NOT in recession, even to the point of downplaying the most current data about the H1 decline in GDP, even to the point of declaring that the economy could not possibly be in recession, since it was only NBER that could declare the economy in recession (probably some time after the election!)

      This is why, for more unbiased economic analysis, I follow sites like WolfStreet.

      1. Baffling

        Gonna point out a fact here. There was no recession. “We” were right and you were WRONG! Fact. That is why you are being ridiculed today johnny.

      2. pgl

        “According to GDI, economic growth was perfectly flat in 2002.”

        That’s a lie. It rose for the first 2 quarters but did fall in Q3. It was higher in 2022Q4 than it was in 201Q4. And in 2023, it continued to rise.

        But I guess little Jonny boy is as competent at looking this up as he was about how BEA showed corporate profits during this period.

        Yea my stalker continues to exhibit his stupidity.

    3. Menzie Chinn Post author

      JohnH: Well, if you were not “cheering”, you were certainly arguing that a recession had started in 2022H1. All I am doing is pointing out that that argument is likely wrong.

      And, by the way, not many people will look at GDI in isolation.

      1. pgl

        “According to GDI, economic growth was perfectly flat in 2002.”

        Wait – has Jonny boy decided to move the goal posts back 20 years? Or does he think George W. Bush is still President and Saddam Hussein rules Iraq?

      2. JohnH

        No, Menzie, I was NOT arguing that a recession had started in 2022H1, I was pointing out that you for spending so much time trying to prove that we were NOT in a recession, when the outcome was still too close to call. The real takeaway were that economic growth was extremely weak, if not negative, and it was too close to call. Of course, opinions about the eventual resolution would have been fine IMO as long as they acknowledged the ambiguity of the situation.

        1. Menzie Chinn Post author

          JohnH: I think I put enough caveats and notes that all the data — but particularly GDP — would be revised. And I gave a case study (2001) of when GDP as originally reported or even revised did not conform to the 2 consecutive negative GDP rule for recession declaration. I don’t see how I could’ve been more nuanced in my assessment without being called milquetoast. The fact that neither NBER nor ECRI have declared a recession in 2022H1 suggests that I was not overly critical of your judgment. I would further note that the Sahm rule — the best high frequency low-lag time indicator we have — does not come anywhere near to suggesting a recession in 2022H1.

        2. baffling

          “No, Menzie, I was NOT arguing that a recession had started in 2022H1,”
          bullcrap. Johnny, your argument has been that unless we have dazzling growth, then things are bad. you have insisted that slow growth was terrible. let me AGAIN point out a fact, Johnny. you have been WRONG. the economy has been performing just fine, despite your reluctance to accept the truth. this economy should be the envy of anybody who examines it without bias. Johnny, you have been the one insisting on placing a “bad” tag on the economy, despite the “ambiguity” as you call it. but that is expected, because you need a poor economy for any chance to reelect trump and support putin. hack.

  5. pgl

    JohnH was declaring we were in a recession on 9/29/2022? Folks – remind me. When did Princeton Stupid Steve first declare we were in a 2022 recession? After all – JohnH has been competing with Princeton Stupid Steve for dumbest troll of the year for a long time.

    Of course the post was about monetary policy rules which is way over Jonny boy’s little brain. Worse yet Princeton Stupid Steve thinks the Taylor rule was how Irving Fisher defined expected real rates back in 1907.

    Yea the troll choir here does not even get the basics.

  6. Baffling

    Recently johnny tried to pull this fast one. All those deaths in Ukraine? Fault the usa because they did not endorse a peace plan in 2022. But dont fault Russia or putin for illegally invading Ukraine in the first place. Or committing an immoral and unjust attack on the innocent people of Ukraine, including deliberate rape and murder of women and children. Yeah, its not Russia and putins fault all those people suffered and died. Jonny you are an immoral human for your choices. Any mother who raised you should be ashamed if she has any morals whatsoever. You are a fraud and a propagandist.

    1. Macroduck

      The logic of Johnny’s recession views, his Ukraine war views and his “Democrats are the ones who hurt poor people” views does all seem quite consistent. Whatever the truth is, Johnny is against it.

  7. pgl
    Real Gross Domestic Product for Mexico

    JohnH recently found a single discussion that he took to suggest Mexico is having some sort of economic miracle thanks to supply side policies over the past 5 years. Of course Jonny boy could not be bothered to check how Mexican real GDP has fared over this period. Thankfully FRED has the data.

    Real GDP over this 5 year period has risen by only 4%. Some economic miracle. I guess Jonny boy does not realize that Mexico got hit hard in 2020.

    1. JohnH

      pgl’s just upset that AMLO is raising the minimum wage so fast as well as trying to take control of the economy away from the oligarchs. According to pgl, there are e no oligarchs in Mexico, they’re his friends! And then, of course, pgl blames AMLO for the COVID recession in Mexico in 2020, when no economy performed well. What an idiot!

      1. Macroduck

        “pgl’s just upset that AMLO…”

        “According to pgl, there are e no oligarchs in Mexico,…”

        “pgl blames AMLO for the COVID recession in Mexico in 2020…”

        This is not mere mumbling. This is lying in the guise of mind reading. Nowhere has pgl expressed any of these views.

        This is among the cheapest of debating tricks, along the lines of “when did you stop beating your wife?”, but without the question mark.

        Johnny got the economic facts wrong. pgl called him on his mistake. Johnny tries to distract us from his mistake by making up complete nonsense and attributing it to pgl. What a liar.

        1. JohnH

          What facts did pgl present to refute what Reuters reported? Tricky Ducky, pgl’s doppleganger shows up right on schedule!

          1. pgl

            I posted Mexican real GDP which a mere 4% higher as of 2023QIII than it was in 2018Q3. What facts did little Jonny boy provide – oh yea the fact that his mommy refuses to change his stinky diaper.

        2. pgl

          I guess the term supply-side ticked little Jonny off even though it was the center piece of his own damn link. Yea – Jonny boy once again cannot even read his own articles.

  8. joseph

    It’s seems that both Stephen Moore and Larry Kudlow have acknowledged on Fox News that the Biden economy is spectacular.

    Given their histories as counter-indicators, we are so screwed.

    1. Moses Herzog

      Funny. Hehehehehe!!!

      Joseph. I’m in a pretty good mood right now, but you still made me laugh and feel even better. My Mom’s Dad was named Joseph. He was kinda a weirdo with very bad family background. That may be part of where I got my weirdo genes from. Hard worker though…… with INCREDIBLY strong arms. Worked in a meat packing plant basically all his adult life. That closes today’s chapter of “Temporary Narcissism No One Cares to Hear About”

    2. Pgl

      Yea but Kudlow tried to tell his gullible audience that real wages are down by reaching deep into the JohnH playbook

    3. Baffling

      Saw kudlow, but missed moore. Gotta ask, what is their angle. Its not like they would come out and embrace a strong democratic economy out of respect for the truth. What are they up to? Sounds cynical, but that is the world we live in now.

  9. pgl

    Whew – little Jonny is ANGRY for being called out. His response? Ambiguity should not be tolerated?

    Excuse me but it has been little Jonny boy who is guilty of being ambiguous here. The NBER business cycle crew has been very consistent at how they define recessions and any troll who thinks it is a slam dunk that two quarters of a slight decline in measured real GDP must be a recession needs to start READING this blog. Yea I get little Jonny boy never READS. He just rants.

    But let’s roll the tape. Over the two quarters were real GDP showed a very modest decline real GDI was rising. One would think little Jonny boy would have noticed as he kept screaming about how profits was rising back then.

    But wait over the next 2 quarters real GDP rose quite a bit but real GDI growth was less. And here came little Jonny boy screaming real GDI was the right measure. Little did this MORON notice that real compensation was rising while it was real profits that were falling – a lot.

    So ANGRY little Jonny boy screams ambiguity, it is he that is the one guilty of that.

    1. Macroduck

      Johnny has lectured us on how “mainstream economists” are fixated on GDP (contrary to evidence), and has also insisted that we accept variation in GDP as evidence of recession, no matter what the rest of the data indicate. Mumble, mumble. MO

      1. JohnH

        Yeah, I know, Tricky Ducky. Every recession during a Democratic administration is just a “variance in GDP!” Spin, spin, spin…

        1. Macroduck

          Not what I wrote. You don’t have the chops to address what I actually wrote. Not this time. Not ever. There’s not much to you, boy.

        2. Baffling

          It is that you want to make the assumption that any variance has to be bad news. Johnny it would be ok to say things seem to be changing lets look closer. But you want to insist every little variation MUST be a recession. And time and again, you are shown to be wrong, johnny.

        3. pgl

          There was no recession under Biden. None under Clinton or Obama. Reagan, Bush41, Bush43 (2), and of course that 2020 collapse. I guess Trump, Reagan, and the two Bush’s were all Democrats.

          Damn – I know my stalker is retarded but it seems he is getting worse by the hour.

  10. Ivan

    Regarding that recession in 2022: its on the way
    Regarding that recession in 2023: its on the way
    Regarding that recession in 2024: …..

    1. pgl

      Exactly. But I’m betting the ranch that we will have a recession before the first intelligent comment from JohnH appears.

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