There´s no risk of recession, we´re just depressed!

I usually find Ambrose Evan-Pritchard an interesting read. However, today he spins an unlikely optimistic tale on the near future of the US economy in “Ignore the ‘whiff of panic’ as US economy stalls”.

He ends with a picture of job openings

Cusp of recession_1

And writes:

The ratio of job openings to applicants is now higher than it was at the top of the last boom in 2007 by a substantial margin. Hours worked have surged. The labour market is tightening hard. Unless Americans have gone through a Puritan conversion, their swelling disposable income must soon start flowing into the shopping malls.

This is not the picture of a country on the cusp of recession.

Only no one is talking about “recession”. In fact, Jim Hamilton´s GDP-based Recession Indicator Index has rarely been as low as it is now for it´s more than 45-year history!

What people have stopped doing is referring to the post 2009 “recovery” as a “depression” (intimately called Bernanke-induced “little depression”). And the job opening picture is not at all inconsistent with that, which is well described in the chart below.

Cusp of recession_2

 

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