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> If there were a way to predict future recessions, and it was reliable, and it was well known to the point of being published on a public web page, then it wouldn't work. As soon as it predicted a future recession everyone would sell their long positions and the recession would happen almost instantly.

You're equating the behavior of the stock market with a recession, when they're not the same thing. The stock market is correlated, yes, and people talk about it because it can be a leading indicator of the BLS data, but it's not how we define a recession. You can have negative GDP growth with a rise in the stock market, and you can have a dip in the stock market along with positive GDP growth.






Yeah, I was being sloppy in how I was talking there. But if you know there's going to be a recession you'll immediately stop making investments in capital goods, for instance. You'll probably reduce other forms of output too and see if you can lay off some of the workers you know you shortly wont' be needing. This will all tend to cause a recession if everybody does it.



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