University of Chicago economist and Nobel Laureate Richard Thaler says he doesn’t see anything that resembles a recession in the U.S.
It used to be that economists would see two consecutive quarters of negative Real GDP growth and say “recession.” But apparently not economists like Thaler. But at least the Atlanta Fed’s GDPNow real GDP tracker is pointing to weak growth for Q3 at 1.379%.
So, if 1.38% real GDP growth holds up, the US is technically no longer in a recession. So, Thaler would be correct. However, the US Treasury yield curve 10Y-2Y (blue line) remains inverted and the Conference Board’s Leading Indicators (yellow line) is growing at 0.0% YoY.
And for those expecting interesting news from The Fed’s Jackson Hole conference, I expect Powell to say that The Fed is going to have to jack-up rates to fight inflation (which is crushing the middle class and low wage workers).
Unlike Thaler, I don’t see a strong economy, just a weak economy except for employment (at negative wage growth). And declining savings.