That\u2019s EJ Antoni\/Heritage Foundation<\/a>, writing in September 2022<\/strong>. A cautionary note on declaring recessions.<\/p>\n Furthermore, the Biden administration\u2019s cherry-picking of data has come back to bite it, with even its selected data points now being revised to indicate a recession. And while these numbers confirm the economy shrank in the first half of the year, the rest of this year holds little promise of recovery.<\/p>\n<\/blockquote>\n Just a reminder of what data we know now about 2022H1, and what happened subsequently.<\/p>\n Figure 1:<\/strong>\u00a0Nonfarm Payroll employment (bold dark blue), Bloomberg consensus of 2\/1 (blue +), civilian employment (orange), industrial production (red), personal income excluding current transfers in Ch.2017$ (bold green), manufacturing and trade sales in Ch.2017$ (black), consumption in Ch.2017$ (light blue), and monthly GDP in Ch.2017$ (pink), GDP, 2023Q4 advance release (blue bars), all log normalized to 2021M11=0. Hypothesized 2022H1 recession shaded light blue. Source: BEA, BLS via FRED, Federal Reserve, 2023Q4 advance release,,\u00a0S&P Global Market Insights<\/a>\u00a0(nee Macroeconomic Advisers, IHS Markit) (2\/1\/<\/em>2024 release), and author\u2019s calculations.<\/em><\/p>\n What about the Sahm rule (real time)?<\/p>\n Figure 2:<\/strong>\u00a0Real time Sahm rule indicator, in % (blue).\u00a0<\/em>\u00a0Threshold denoted by red dashed line. Putative peak-to-trough recession of 2022H1 shaded lilac. Source: FRED.\u00a0<\/em><\/p>\n And, recalling that NBER\u2019s BCDC doesn\u2019t place primary reliance on GDP, here are other measures of output.<\/p>\n Figure 3:<\/strong>\u00a0GDP (blue), GDO (tan), and GDP+ (green), final sales (red), all in bn.Ch.2017$ SAAR.\u00a0 GDP+ assumes 2019Q4 GDP+ equals GDP. Hypothesized 2022H1 recession shaded light blue. Source: BEA 2023Q4 advance estimate,\u00a0Philadelphia Fed<\/a>, and author\u2019s calculations.<\/em><\/p>\n So, now Dr. Antoni has declared us in recession<\/a>, as of several weeks ago. He might end up being right. As of yesterday, nowcasts are rising<\/a>, the Lewis-Mertens-Stock Weekly Economic Index is running at 2.37%.<\/p>\n \u00a0<\/p>\n<\/p><\/div>\n\n
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