Bear Market – Jun 10


The United States Entered A Recession in February – What This Means

By Editor, Bear MarketWell its official.

The historic run we’ve been on since 2009 is over.

After 128 months of uninterrupted economic growth the United States’ run finished in February 2020.

This according to new data released on June 8th, 2020 by The National Bureau of Economic Research (NBER).

The NBER is a “private research group led by the nation’s top economists.”

The 128-month expansion that ended in February is the longest in US history dating back to 1854.

The data showing the bull market ended and that we’re now in a recession isn’t surprising… The US was going to enter a recession anytime between now and July when the 2nd quarter US GDP numbers release.

According to NBER data, quarterly economic activity peaked in the 4th quarter of 2019. And monthly economic activity peaked in February.

This means the 128-month bull market officially ended in February.
That economic activity peaked in February is no surprise. The market was humming along with nothing to stop it…

That is until the coronavirus started its worldwide expansion in March.

Since Mid-March, we’ve gone from a great economy with nothing to stop things… To the worst economic data since the Great Depression. To as of this writing 26 to 27 million Americans now getting unemployment benefits.

This wild swing took only 3 months.

And the unemployment benefit numbers above still don’t show the full story.

Why?

Because that number doesn’t include a total of 42.6 million Americans who applied for unemployment benefits in the last 3 months.

Some of these people are now back to work while some had claimed denied.

Normally a recession “doesn’t become official” until two or more straight quarters of GDP contraction.

The NBER decided to break this tradition because of the “depth of contraction and how fast the economy was affected.”

States nationwide are now reopening economies, so we should on our way to recovery. But we won’t know that for a few more months or quarters still.

These kinds of economic measures lag “the real economy” by a few months.

This means you’re going to see a recovery in your everyday life and community before any official government metrics show this.

We knew this was coming. And until the unemployment issue gets fixed it doesn’t matter much what the government says.

Cities, states, and countries worldwide are slow to open the economy in fear of a spike in coronavirus cases.

This will continue to negatively affect unemployment numbers for months… And this is in a best-case scenario.

For more information on that see my post from last week – The Economy Could Take A “$82 Trillion Hit In Depression Scenario.

In this article I show you the wide range of forecasts for what we could be in for in the months and years to come. Both on the pessimistic side of things and more optimistic estimates.

And for more context on the wide ranging negative affects of mass unemployment check out this article from last week – Millions of Americans Are Now Longer Paying Their Bills – How This Affects You.

The mass unemployment is the biggest economic issue we’re all facing now… And likely in the months to come.Regards,

Editor
Team Bear Market

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