Staff Reports
Economic indicators are starting to look about as promising as a rainy 4th of July, and yet the mainstream media has its super-suits on, desperately trying to convince everyone that rain is just a myth. The month started with a classic sign of economic doom: a massive market sell-off, which, if one were to connect the dots, suggests that investors are getting a little twitchy. Yet, in what can only be described as a heroic effort of denial, coverage insists the economy is just dandy. This behavior wouldn’t be surprising if it weren’t so transparent. With the elections looming, the last thing Democrats want is for their disastrous Bidenomics to be blamed for an economic downturn.
One of the latest signs that things are shaky in the economic landscape is a cooling labor market. Reports are flying in, hinting that the U.S. economy might not be achieving that soft landing which many experts had optimistically forecasted. Instead, recent data points suggest that a recession may be inching closer as the labor force growth takes a back seat while unemployment starts to climb. In essence, the economy’s health is looking less like a robust American apple pie and more like a flat soufflé.
Usually before a recession…
-Labor force growth decelerates
-Unemployed counts riseWe're seeing both right now
Chart via @ResidentialClub pic.twitter.com/xow2rW5eCv
— Lance Lambert (@NewsLambert) August 13, 2024
Walking through the numbers, it’s clear there’s bad news all around. Over the past 12 months, the labor force barely eked out a growth of 1.3 million, while the unemployed ballooned by around 1.2 million. This statistic paints a rather grim portrait when juxtaposed with the meager job creation in July—a paltry 114,000 jobs that could barely cover the average coffee stop in Silicon Valley. It’s like running a marathon and finding out you trained on donuts; the performance is lackluster at best.
Despite the gloomy forecast, public sentiment seems to be ahead of the statistics. Nearly 60% of Americans believe they are already living in recession-land, adding to the cacophony of worries. This isn’t just random chatter. Some economists have developed what they call a “recession indicator,” which combines traditional unemployment data with other unemployment measures. According to this model, a mere wiggle of 0.3 percentage points could signify a recession is rustling nearby, while a sig of 0.8 points is like a bright neon sign shouting “Welcome to Bad Times!”
Armed with this alarming indicator, it sits at 0.5 points as of July, lending a sizeable 40% chance that a recession could’ve kicked off as early as March. While the Democrats might want to keep patting themselves on the back for their brilliant economic strategy, it looks like a new wave of reality may just wash over them sooner than they intend. As Americans brace themselves for the potential fallout, it would be wise to start preparing for the fallout of government incompetence. One thing is certain: pretending the economy is still riding high isn’t going to pay anyone’s bills when the storm hits.
