The consensus everywhere is that the United States will slip into a recession.
Although economists and market analysts say the U.S. is bracing for an economic downturn, most Americans think the nation is already in a recession, according to a Politico-Morning Consult poll.
Who else shares this opinion?
The Federal Reserve Bank of St. Louis.
Accidentally anyway.
The regional central bank published a report, titled “Are State Economic Conditions a Harbinger of a National Recession?”
“Economists view recessions as national events. However, past recessions have shown that some states’ economies continued to expand during a recession—particularly when the national recession was relatively mild. The Federal Reserve Bank of Philadelphia’s state coincident indexes (SCIs) can be used to assess whether recession-like conditions have developed in each of the states. And if so, whether there is a threshold in the number of states that might signal a national recession,” report authors noted.
According to the report, 27 states recorded negative growth in the SCI in October.
But here is the kicker that the St. Louis Fed Bank wishes it did not hit publish before giving it another read:
“…26 states need to have negative growth in the SCI to have reasonable confidence that the national economy entered into a recession.”
In March 2020, there were 35 states. In January 2008, there were nine states.
In the end, the St. Fed Fed Bank conceded that the U.S. is already in a recession.
Leave a Comment