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Before I start, can we avoid linking this story to politics? National politics has only the smallest bearing on the business cycle in the aggregate. And no, nobody should cheer for a recession - real people suffer.


The yield curve is blaring a recession warning.

The spread between the U.S. 2-year and 10-year yields on Wednesday turned negative for the first time since 2007. Such a development has occurred ahead of each and every U.S. recession of the last 50 years, sometimes leading by as much as 24 months.

“Historically, the 2-10 has had better predictive ability of recession than equities,” Sri Kumar, president of the Santa Monica, California-based Sri-Kumar Global Strategies, told Fox Business.

“If you depended on equities to tell you whether you are entering into a recession you did not do well. For example, October, November of 2006, exactly one year before the Great Recession began, the 2-10- inverted. Equities did well in the first half of 2008 when we were in a recession and oil prices hit a peak in May of 2008 when we were very much in a recession.
And while a flattening yield curve is typically something investors fear, President Trump earlier this month called on the Federal Reserve to cut rates in order to flatten the yield curve further and spark inflation – something needed to jumpstart a slowing economy.

“They must Cut Rates bigger and faster, and stop their ridiculous quantitative tightening NOW,” Trump tweeted. “Yield curve is at too wide a margin, and no inflation!”

Trump’s call for more Fed rate cuts comes at a time when the economy is slowing as the more than yearlong U.S.-China trade war presses on. The U.S. economy grew at an annualized rate of 2.1 percent in the April to June period, down from 3.1 percent in the first quarter.

But that’s not the only evidence of a slowing economy. A team of Bank of America Merrill Lynch economists led by Ethan Harris say three of the top five economic indicators of the business cycle are “flashing yellow” and are near levels consistent at the start of previous recessions.

Specifically, the team points to weakness in auto sales, industrial production and aggregate hours worked. However, they say arguably the “most reliable early indicator,” initial jobless claims, remains at a low level.
The bank’s official model suggests a 20 percent chance a U.S. recession will occur in the next 12 months, but the economists say the data and events lead them to believe it’s more like a one-in-three chance. They think the Fed will cut rates two more times this year after in July lowering its benchmark interest rate for the first time since the financial crisis.

“We expect two more rate cuts this year (Sept and Oct), but see the risks clearly for more if the US-China trade tensions continue to escalate,” Bank of America Merrill Lynch US Economist Joseph Song wrote.

While rate cuts at the next two meetings may appease Trump, they probably won’t make much of a difference.

“The Fed has become hereafter irrelevant,” Kumar said.

“They are probably going to cut two more times, three more times, take your pick. Or they may cut by 50 basis points and cut again. I think it is too late. You may temporarily boost equities, but it is going to signify panic on the part of the Fed. I wouldn’t be surprised if after that they resume a quantitative easing four as Trump has asked them to do as well.”
Pull out of the stock market, get some secure markets.

It probably won't be a crash, but stocks certainly dont go UP during a recession.
>National politics has only the smallest bearing on the business cycle in the aggregate.
You might be able to get a away with saying something like that during a normal administration, but not when the leader of the country has made so many drastic economic political moves during a single term in office. We have the trade wars and tariffs which are definitely affecting the the economy. Tax cuts to the wealthiest Americans (they have to make up that difference somehow). Even if you just look at those two things, that's a lot of bearing for national politics to have and its not even mentioning the budget changes themselves.
>National politics has only the smallest bearing on the business cycle in the aggregate.

No, you can't use this excuse when Trump's reckless fiscal and monetary policy of massive deficits and boosting spending when the economic cycle didn't require it, and forcing the Federal Reserve to cut rates to boost the economy in the short run, while making it harder to handle a downturn when it inevitably happens, will be directly responsible of profoundly damaging the economy.

Trump shat on the cardinal principles of fiscal responsibility and central bank independence just for short term political gain, and when the chickens come home to roost, he will be rightly blamed for what will be known as the Trump Recession.
You can say the timing of the end of a business cycle is impacted or some margin or another of its severity. The overall trend is still a trend.
No wonder Trump is screaming at the Fed to slash interest rates, he doesn't give a shit if it causes a depression, he just want the economy to be decent for 2002.
Hopefully, the crash does come when the UK sets it off with Brexit.

This is why having businessmen in charge of the government is a fucking terrible idea.
>And no, nobody should cheer for a recession
I'm cheering for a recession.
People will suffer, but the alternative is much worse.
>and when the chickens come home to roost, he will be rightly blamed for what will be known as the Trump Recession.
With how things are shaping up, this will be the Trump Depression and we'll be lucky if we don't got French Revolution. Because I'm sure leaving the poor to die after you gut all their social programs, and making sure they're armed is a brilliant idea.
2002 was a nice year.
The alternative could be kicking out trump without a recession.
>The alternative could be kicking out trump without a recession.
Won't happen because of voter suppression and Russian attacks.
Moscow Mitch is keeping America defenseless for a reason.
Imagine believing this
You are one deluded little man
We are more secure than we were in 2016.

Trump was more popular in 2016.

The candidates opposing him were worse in 2016.

And won by a razor thin margin.

But don't let that comfort you. VOTE.
Literally no evidence to suggest russia interfered with the election, you are a tinfoil wearer
>Robert Mueller
>director of NSA

No evidence tho kek.

Nice bait.
Based retard
Can we call it the Trump dump when wallstreet crashes?
Sucks for Trump, he has basically nothing positive to point to in his 3 years in office other than the good economy.
Greetings time traveler! Welcome to the far off year of 2019! The Mueller Report is out, and the conclusion is that Russia fucked us in our tight little digital ass. Please, return to your own time and prevent this awful future from ever coming to pass!
And if your sky is falling doesn't come falling? Oh yeah you clowns will go on to the next Orange man bad. Lmao. You losers will all ways be losers.
Hey it would be nice, but the 10 year ratio hasn't been wrong in 50 years. And I'm pretty sure it's only 50 years old.
Thread not about trump
>you guys always on and on about orange man bad
Seems like you are stuck friend.
If there are no problems, why is Moscow Mitch committing treason to protect Russian interests?
>We are more secure than we were in 2016.
LOL, tell that to what the Russians, Iranians and North Koreans are doing, all thanks to Trump making all the wrong decisions.

>More popular
Rev up that voter suppresion and Russian hacking.

>The candidates opposing him were worse in 2016.
Officially lost in the forest of delusion.
Meanwhile in Trump's world of delusion.

The Dow Jones lost 800 points on Wednesday as Trump claimed to be 'winning' the trade war with China.

As the stock market cratered Wednesday afternoon, Trump claimed victory over his trade war with China in a rambling series of tweets.

"We are winning, big time, against China," Trump wrote at 3:20 p.m., when the Dow Jones average was down 698 points on the day. "Companies & jobs are fleeing. Prices to us have not gone up, and in some cases, have come down. China is not our problem, though Hong Kong is not helping." The Dow finished the day 800 points down.

Trump is lying about consumer prices not going up. In April, NBC News reported that Americans paid a total of $1.5 billion more for washing machines in 2018, thanks to Trump's trade war. That figure comes out to about $100 more per washing machine.

Earlier this week, Trump's own Labor Department released data showing inflation hit a six-month high. "[It] is clear tariffs are beginning to drive goods prices higher," Sarah House, a senior economist at Wells Fargo & Co., said, according to Bloomberg.

Researchers estimate Trump's various trade wars cost the U.S. economy $7.8 billion in 2018. Research published by the Federal Reserve earlier this year estimated Trump's trade war with China will cost families $831 each year, or almost $70 per month.

In addition to families across the country, Trump's trade war has devastated farmers. Farm bankruptcies have spiked since Trump took office, and the trade war with China seems to be making things worse.

After discussing China, Trump abruptly changed topics in the middle of a tweet, aiming his ire at the Federal Reserve.
"Our problem is with the Fed. Raised too much & too fast. Now too slow to cut... Spread is way too much as other countries say THANK YOU to clueless Jay Powell and the Federal Reserve. Germany, and many others, are playing the game! CRAZY INVERTED YIELD CURVE! We should easily be reaping big Rewards & Gains, but the Fed is holding us back. We will Win!"

Trump is complaining that the Federal Reserve raised interest rates too fast, and attacking the Federal Reserve Chair Jay Powell by name. Trump himself nominated the "clueless" Powell for the position in 2017.

Trump also mentions the inverted yield curve, which refers to the price of two-year and 10-year treasury bonds. Usually, 10-year bonds pay more interest. An inversion is when two-year bonds pay more interest than the 10-year bond, and this phenomenon has occurred before every recession in the past 40 years, according to Politico.

"It sounds like a wonky bit of financial arcana," Politico's Ben White explains. "But it's a closely watched gauge. And it has investors freaked out."

Many economists attribute Wednesday's massive stock market plunge of 800 points on investor worry about a looming recession, sparked by the yield curve. The inverted yield curve comes on the heels of major banks like Goldman Sachs and Bank of America issuing warnings about a coming recession.

According to the Washington Post, previous administrations would come up with policy proposals to stave off a recession. "Instead of rolling out new policies, Trump and other top aides have escalated their attacks on the Federal Reserve, trying to pin much of the U.S.'s problems on what Trump alleges is elevated interest rates that are strangling growth," the Post reports.

Trump had no trouble boasting when the economy and stock market were doing well, claiming all the credit. But as soon as things start to turn south, Trump is wasting no time trying to find a scapegoat.
Who nominated the head of the Federal reserve again?
Vote trump
What people should be looking at is his comment on Inverted Yield Curve, if you haven't heard about that today, congrats, you're just like Trump. An Inverted Yield Curve is when the interest rates on short-term bonds are higher than the interest rates paid by long-term bonds. And it is one of the biggest carnies in a coal mine an economy has for recognizing when a recession happens because that is one of the first things to occur.

The Trump recession is coming.
No, no, no.
Pull out at the high point, sit on your cash until the drop valleys out, then buy it all back in.
Sell again during a peak. A longer strategy would be to play the housing market if/when you have that much money, but I'm a bit of a pussy and I just buy rental properties with the intent they make double the worth over 20 years.

I've been telling people this for years and they look at me like I'm crazy.
Ups and downs are natural and unavoidable, it has to do with the timing for major birth periods and the timing for a recovered market yielding new businesses.
As those new businesses fail the loans all blow out and jobs shrink, and overall spending decreases. Then everyone scrambles and life gets a little worse for a while as the bankruptcies are absolved, and 7 years later the process repeats.

It's no coincidence that after the 2008 crash we didn't start believing the economy was Doing Great Again! starting around 2015 - people who failed their business could abuse their credit once more like the rest of the regular people and buy new trucks and go out to eat twice a week and blahblahblah.
Trump doesn't make every decision. I'm not throwing that out from nowhere: https://www.brennancenter.org/analysis/voting-machine-security-where-we-stand-six-months-new-hampshire-primary

Yeah, him and his toadies are getting in the way but the government is more than one man. I take solace in that.

As for the other two thirds of your post, you seem be under the impression that I LIKE the orange turd. Please check your fire, friendo.

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