
Ask HN: Are we headed into another recession? - anon2121212121
A lot of the news coming out recently seems to be pointing in the direction that we are headed into another recession.<p>1) (http:&#x2F;&#x2F;www.zerohedge.com&#x2F;news&#x2F;2015-11-18&#x2F;dead-unicorn-walking-square-ipos-9-well-below-expected-range)<p>2) (http:&#x2F;&#x2F;www.marketwatch.com&#x2F;story&#x2F;san-francisco-real-estate-looking-like-it-did-before-dotcom-crash-in-2000-2015-11-20?dist=countdown)<p>3) (http:&#x2F;&#x2F;mobile.nytimes.com&#x2F;2015&#x2F;11&#x2F;22&#x2F;technology&#x2F;livingsocial-once-a-unicorn-is-losing-its-magic.html)<p>4) (https:&#x2F;&#x2F;gcaptain.com&#x2F;baltic-dry-falls-below-500-for-first-time-ever&#x2F;)
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11thEarlOfMar
No.

The US been in recovery since 2010. First to recover was corporate profits
thanks to downsizing and low interest rates. Consequently, the S&P went on a
tear [2010-2014]. With corporate profits recovering, companies could start re-
hiring and unemployment dropped [2010-2015][0]. Now that employment is back in
healthy territory and the stock market is back where it should be, Americans
are feeling a positive wealth effect, so next to recover is real estate. Still
juiced by low interest rates, real estate prices will continue to rise
significantly in the [2014-2016] period.[1]

I'd be on the lookout for a recession once this real estate cycle plays out,
maybe in the [2017-2019] time frame. By then, interest rates should return to
the low end of their historic range [2].

[0]
[http://data.bls.gov/timeseries/LNS14000000](http://data.bls.gov/timeseries/LNS14000000)
[1] [http://money.cnn.com/2015/08/11/real_estate/median-home-
pric...](http://money.cnn.com/2015/08/11/real_estate/median-home-price/) [2]
[http://mortgage-x.com/trends.htm](http://mortgage-x.com/trends.htm)

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bmm6o
Data points 1 and 3 suggest that some tech investors have over-valued some
startups, relative to later or public investors. That doesn't directly suggest
there's a recession coming, though a lot of people losing a lot of money in a
bubble bursting is never good. 2 is related, in that loose money in tech
drives up the cost of some supply-limited items, especially in SF/SV. I'm not
sure how these conditions are supposed to predict a coming recession.

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T-A
Of course we are. The tricky question is when. Here is an indicator with a
decent historical track record which says not yet:
[https://research.stlouisfed.org/fred2/series/RECPROUSM156N](https://research.stlouisfed.org/fred2/series/RECPROUSM156N)

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gesman
The problem is not with the state or valuation of technology companies but
rather with US government debts reaching record levels.

This bubble is of historic proportions and of a way bigger concern that the
shape of overvalued startups.

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mcnees287
And why is that? Technically, we could repay all of our debt, at any time, as
we print our own currency. There are long-term implications for what you are
talking about, but we are far away from anything approaching a crisis (not
including self-imposed crisis by The Congress). There is no connection between
a household 'maintaining a budget' and the way the US government finances
itself. It is a false equivalency, but serves as a useful political cudgel.

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tmaly
if you read zerohedge you would think we are always in recession.

