How About Some Good News on the Economy?

PJM|VodkaPundit:

Appearing remotely on Sunday’s Face the Nation, St Louis Federal Reserve Bank Chairman James Bullard indicated that the Fed has no idea, really, just how bad the Coronavirus Contraction is going to get. Asked by Margaret Brennan about his team’s prediction that “47 million Americans could lose their jobs,” bringing the unemployment rate up to 32%, Bullard said the “32 percent number is a compromise in the middle.”

In the middle of what, you might ask. Bullard told Brennan that he and his economists at the St. Louis Fed estimate that the “unemployment rate could go anywhere between 10 percent and 42 percent.”

So things could get Great Recession bad or blow past the 25% unemployment record set during the depths of the Great Depression in 1933. That’s a bit like the doctor telling you that you either have a bad case of the flu or maybe caught a rare form of cancer that makes all your limbs slowly fall off.

I’m not picking on Bullard here. Not only does no one know what’s going to happen to the economy, at this point nobody can know. The question is less “How bad is it going to get?” but “How quickly do we recover?”

The answer to that could be very nice, indeed.

An economy with plenty of liquidity and weeks of pent-up demand ought to bounce back almost as quickly as it sank — like a big kid on a trampoline. Sharp economic downturns are usually followed by equally sharp recoveries. The 1981-82 and 1991 recessions come to mind.

What made the Great Depression and the Great Recession alike were anemic recoveries that took seemingly forever. As I noted back in March [VIP link]:

When Franklin Delano Roosevelt came into office pledging to end the Great Depression, he and Congress simmered up a party-size bowl of alphabet soup agencies to micromanage the business, wages, prices, and employment. The result? A couple of left-leaning UCLA economists were forced to conclude that FDR’s New Deal actually lengthened the Great Depression by seven years.

Coming into office on the heels of the 2007-08 financial panic (caused in no small part by Washington meddling in the mortgage markets), President Barack Obama indulged in a flurry of lawmaking and micromanagement unseen since FDR. As a result, Obama’s recovery was the slowest since FDR’s. In some ways — Washington’s addictions to spending and debt are the worst examples — we’re still dealing with the hangover from Obama’s reaction to the Great Recession. read more

28 Comments on How About Some Good News on the Economy?

  1. Maybe we’ll see the worst depression in modern human history.

    It wouldn’t surprise me since it would serve the purpose of the high command of the PTB very well.

    You do realize that is what the terminal goal of all this stuff is, don’t you?

    And it will meet little effective resistance in the process, most people will actually be cheering it on.

    3
  2. CALM DOWN! This is all going to be over by the end of April. We are going to be fine and come back stronger than ever.

    21
  3. I’m with the smart lady.

    The hell are these craven mastubators coming from with their doom and gloom predictions?

    10
  4. the middle of 10% & 42% is 32%???

    I may be dumb at math, but something doesn’t add up

    lessee …. 42-10 = 32, 32/2 = 16, 10+16 = 26, 26+16 + 42 …. sooooooo …. help me out here people!

    guy must have the same Economics degree as AOC

    8
  5. The good news is there’s no shortage of bad news, we won’t run out any time soon – a democrat told me so down at the bread line.

    8
  6. Good economic news will happen soon but
    don’t rely on the msm to admit it.

    The msm is the propaganda arm of the smellocrat party.
    And george soros actually OWNS them.

    As long as DJT is POTUS they will never
    report any event as a positive.

    I’d like to say that the death of
    NAZI jugend soros would end this

    But his family and the well paid msm
    will forever extend this

    Fore they are sworn to destroy the USA

    YES

    Soros admitted that !

    7
  7. Keep in mind that this economic crisis had no basis in (bad) economic policy or other market based factors (i.e., expansion/contraction), although, an argument could be made that a contraction was overdue. Nonetheless, it was purely a matter of a non-market driven SHUTDOWN of businesses and by extension, the economy. As such when you re-open businesses, the pent-up demand will drive the economy back into good health.

    10
  8. I’m with Gkadys.

    The only thing that went wrong is the stoppage of work.

    Resume work and this reverses.

    It’s not like a volcano erupted in Tennessee and the physical world was changed.

    Better than half of those I talk to think it’s BS. I am appalled at those that recite the talking points of “sit down!” panic verbatim. It’s like I’m listening to Mika trying to explain things to me.

    No, honey, mark my words on your calendar. You’re wrong about this.

    So many people act like the atmosphere has been poisoned by a local nuke meltdown.

    And then add their paranoia to worse-than-useless-actions:

    I’m telling you – you are stupidly doing nothing if you wear your shopping/PPE gloves while you drive !

    As someone who has played the “Don’t contaminate yourself, your vehicle, your home, your customer with the chems you use game” since 1986 – if you wear contaminated gloves while driving, you will get it on your hands next time you drive. Trust me – I learned this lesson the hard way twice.

    There is much what I see that reminds me of the two dogs ferociously barking at each other through a fence like they would tear each other up if they had a chance.

    Then the camera pans out and the end of the fence is about 12 inches away from them.

    That’s how effective I see much of the effort being made out there is.

    The threat is not that bad.

    I do want to know how many clerks and all store and shipping workers that are catching it.

    I’m betting close to zero. Why aren’t we getting a daily count on them catching it? The stores are the “risk” aren’t they?

    This is an assassination attempt on America.

    The trick was to get us to stand still while they slipped the shiv in.

    9
  9. @Gladys – I am NO doomsday-er but DEAL, pinky bet?

    While “this” is a temporary virus it will be ‘gone’, I agree, if that is what you mean?

    If you are talking economy though? Not.

    Your one month time clock ticks now…Why May 5th??

  10. I think we’ll probably get around 80% of the economy back quickly, within 6 months. The skittish consumer isn’t going to part with their cash. “Pent-up demand” isn’t going to happen, except where it’s necessary. I think this will be a problem, but not a huge one.

    3
  11. I don’t like how they’re pumping so so much money into the economy.
    But if you’re not in the market while they’re all pumping and printing money to prop up the market you are going to miss out.

    3
  12. Correct me on this if I’m wrong.

    During the press conference I think I heard Trump say he did not want to even discuss restarting the economy at this time.

    “I don’t even want to talk about it” are his exact words.

    If I heard that right, that he’s not going to talk about everyone getting back to work, it’s a very very bad sign.

    If it was something else, what was he talking about?

    1
  13. I love most of you and come here for the comments. That stated, I believe that I have made my feelings about the wuflu pretty plain.
    I am in the enviable position where nothing that has happened actually effects me. ralphie blackface not withstanding…
    but ….”you either have a bad case of the flu or maybe caught a rare form of cancer that makes all your limbs slowly fall off.” made me laugh out loud.
    Be smart.
    Be safe.

    5
  14. @Gladys – oh I get it! All those sealed indictments will come out?? I hope so…that would be FANTASTIC.

    Is your theory that we are being ‘kept indoors’ for a New Awakening?? The application of the law to those that deserve it? (WHICH has been missing since at least 1963).

    Have you heard the new Dylan song???

    Murder Most Foul.

  15. @Ghost – Kept indoors for a new awakening? WHUT? Now I don’t know WTF you’re talking about. Although I am all for application of the law to those that deserve it. And I do enjoy “Murder She Wrote.”

    1
  16. Gladys

    “@grool – he’s not ready to talk about it right now.”

    I figured, and hearing that must make tens of millions of hearts sink like a brick.

  17. @Gladys – yeah, I might sound STRANGE and might have a different timeline, but you are the soothsayer here.

    Why the 5th of May?? That’s twenty eighth daze, aka four weeks FROM TODAY.

    What do I win from the bet?? What are YOUR stakes???

    I’ll up yours, and say he should come out TOMORROW and say OUR next best friend is the ‘wonderful’ country of India and tell CHI-na to fuck off.

    Anty up.

  18. i’m with gladys on this. I think the economy will bounce back quite quickly BUT without all the extravagance and wasteful spending. that will come later, maybe 2-3 yrs or so. Vegas will sit idle for a couple years until the furrenirs are allowed back in.

  19. “Federal Reserve Bank Chairman”

    why would he know anything about the economy except how to wreck it?

  20. This is like playing catch with yourself by throwing a rubber ball against a wall. You expect it to bounce back to you, but you didn’t see that rock on the pavement. The ball hits it and careens off at an angle, and hits another rock, throwing the ball into yet another unpredictable direction. You end up chasing that spinning ball down the street as it hops and rolls merrily until it plops into the storm drain…

    Jus’ sayin’

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