In an earlier post from last December, I noted the correlation between growth in RV sales and recession. Extrapolating October YTD data for 2018 as a whole, I obtained 11% probability of recession. Extrapolating June YTD data for 2019 (thanks to reader AS for compiling the time series data), I obtain 70% probability of recession for 2020.
An Ad Hoc Term Premium Adjusted Term Spread Recession Model
One criticism of the use of the term spread model to forecast recession in current times is that this time is different. [1] [2] [3] In particular, due to quantitative easing, the term premium is lower than in past episodes. Hence, in this interpretation, an inverted yield curve no longer signals as much future depressed interest rates as in the past.
Intraday PredictIt Probability of Recession Hits 46%
Hit that value earlier today, before dropping to 42% (recession in Trump’s first term, that is)
Market Assessment of Prospects for Resolution of the US-China Trade Dispute by September 2020
Going from August 22rd to 23rd, front month futures dropped 12-6; the August 2020 futures price (which are an unbiased predictor of one year ahead spot prices) was down 8-4. Hence, farmers should prepare for a long, tough, period of self-inflicted (by the administration) damage.
Prediction Markets on Recession by January 2021
PredictIt, accessed 4pm Pacific today:
Who’s Forecasting a (Technical*) Recession?
I keep on hearing that economists are lousy at forecasting, citing the An, Jalles, and Loungani (2018) analysis. Recently, we heard Larry Kudlow claim that nobody was predicting a recession in December 2007, when he was dismissing the possibility. Without disputing the consensus is lousy at detecting turning points in real time, we can check if all economists are.
CES Preliminary Benchmark Revision: NFP
Down 501K in March. Private NFP down 514K.
Back-of-the-Envelope Calculation of Trump Induced Dollar Appreciation
If a Recession Occurs, Plenty of People Will Have Predicted It
NABE survey, WSJ survey, Bloomberg survey, PredictIt
Recession Probability If the Rest of August Is Like the First Half
…using plain vanilla 10yr-3mo probit regression, over 1986M01-2019M08 period, using data shown below in Figure 1