47 min
PODCAST: Hexapodia LVII: The "Vibecession" Is Losing Its Vibe "Hexapodia" Is the Key Insight: by Noah Smith & Brad DeLong
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- Økonomi
Producer Confidence & Consumer Confidence (in the Economy), & Our Confidence (in Our Analyses): Noah Smith & Brad DeLong Record the Podcast We, at Least, Would Like to Listen to!; Aspirationally Bi-Weekly (Meaning Every Other Week); Aspirationally an hour...
Key Insights:
* The disjunction between all the economic data having been very good and very strong for the past year and tons of reports and commentary about how people “weren’t feeling it” is mostly the result of the fact that things work with lags.
* There are other factors: partisan politics, and the insistence of Republicans that they must not only vote but also at least say that they agree with their tribe.
* There are other factors: the old journalistic adage that “what bleeds, leads”, exponentiated by the effects of our current short attention-span clickbait culture.
* There are other factors: journalists, commentators, and the rest of the shouting class are depressed as their industries collapse around them, and somewhat of their situation leaks through.
* There are other factors: while people think they personally are doing well, they do remember stories of others not doing wellm and are concerned.
* But mostly it was just that things operate with lags: that was the major source of the “vibecession” gloom-and-doom which was at sharp variance with the actual economic dataflow.
* We are not the modelers: we are, rather, the agents in the model.
* The metanarrative is always harder than the narrative: trying to answer “why don’t people say they think the economy is good?” is very hard to answer in a non-stupid way, and most of us are much better off just saying: “hey, guys, the economy is really good!”
* It is good to be long reality—as long as you are not so leveraged that your position gets sold out from under you before the market marks itself to reality,.
* Lags gotta lag.
* And, finally, hexapodia!
References:
* Burn-Murdoch, John. 2023. “Should we believe Americans when they say the economy is bad?” Financial Times, December 1 https://www.ft.com/content/9c7931aa-4973-475e-9841-d7ebd54b0f47>.
* Cummings, Ryan, & Neale Mahoney. 2023. “Asymmetric amplification and the consumer sentiment gap”. Briefing Book, November 13. >.
* El-Erian, Mohamed. 2024. “A warning shot over the last mile in the inflation battle’. Financial Times, January 15. https://www.ft.com/content/497499b1-0e9f-4215-a536-ecd483ad42b9>.
* Faroohar, Rana. 2024. “Is Bidenomics dead on arrival? The time is ripe for the administration to rethink its messaging”. Financial Times, December 18. https://www.ft.com/content/816ccbf7-d0d5-47be-9c8d-8a8a0cbd0afe>.
* Fedor, Lauren, & Colby Smith. 2023, “Will US voters believe they are better off with Biden? Under pressure after a string of damning polls, the US president is resting his hopes for re-election on his personal economic blueprint”. Financial Times, November 6. https://www.ft.com/content/23687b6b-ac6f-46ab-a701-917a5ed64f4f>.
* Financial Times Editorial Board. 2024. “Why Biden gets little credit for a strong US economy: The president’s team needs to show more energy in addressing voters’ concerns”. Financial Times, January 11. https://www.ft.com/content/a2373c26-87ea-4b77-944f-8a6b28c8675b>.
* Ghosh, Bobby. 2022. “Biden’s a Better Economic Manager Than You Think:
On more than a dozen measures of relative prosperity, he’s outperformed the last six of his seven predecessors. On reducing the budget deficit, he has no peers”. Bloomberg, November 8.
* Greenberg, Stanley. 2024. “The Political Perils of Democrats’ Rose-Colored Glasses: Paul Krugman’s (and many Democrats’) beliefs about the economy and crime miss the reality that Americans still experience”. American Prospect, February 5. https://prospect.org/politics/2024-02-05-political-perils-democrats-rose-colored-glasses/>.
* Hsu, Joanne. 2024. “Surveys of Consumers: Final Results for January 2024”. February 2. http://www.
Producer Confidence & Consumer Confidence (in the Economy), & Our Confidence (in Our Analyses): Noah Smith & Brad DeLong Record the Podcast We, at Least, Would Like to Listen to!; Aspirationally Bi-Weekly (Meaning Every Other Week); Aspirationally an hour...
Key Insights:
* The disjunction between all the economic data having been very good and very strong for the past year and tons of reports and commentary about how people “weren’t feeling it” is mostly the result of the fact that things work with lags.
* There are other factors: partisan politics, and the insistence of Republicans that they must not only vote but also at least say that they agree with their tribe.
* There are other factors: the old journalistic adage that “what bleeds, leads”, exponentiated by the effects of our current short attention-span clickbait culture.
* There are other factors: journalists, commentators, and the rest of the shouting class are depressed as their industries collapse around them, and somewhat of their situation leaks through.
* There are other factors: while people think they personally are doing well, they do remember stories of others not doing wellm and are concerned.
* But mostly it was just that things operate with lags: that was the major source of the “vibecession” gloom-and-doom which was at sharp variance with the actual economic dataflow.
* We are not the modelers: we are, rather, the agents in the model.
* The metanarrative is always harder than the narrative: trying to answer “why don’t people say they think the economy is good?” is very hard to answer in a non-stupid way, and most of us are much better off just saying: “hey, guys, the economy is really good!”
* It is good to be long reality—as long as you are not so leveraged that your position gets sold out from under you before the market marks itself to reality,.
* Lags gotta lag.
* And, finally, hexapodia!
References:
* Burn-Murdoch, John. 2023. “Should we believe Americans when they say the economy is bad?” Financial Times, December 1 https://www.ft.com/content/9c7931aa-4973-475e-9841-d7ebd54b0f47>.
* Cummings, Ryan, & Neale Mahoney. 2023. “Asymmetric amplification and the consumer sentiment gap”. Briefing Book, November 13. >.
* El-Erian, Mohamed. 2024. “A warning shot over the last mile in the inflation battle’. Financial Times, January 15. https://www.ft.com/content/497499b1-0e9f-4215-a536-ecd483ad42b9>.
* Faroohar, Rana. 2024. “Is Bidenomics dead on arrival? The time is ripe for the administration to rethink its messaging”. Financial Times, December 18. https://www.ft.com/content/816ccbf7-d0d5-47be-9c8d-8a8a0cbd0afe>.
* Fedor, Lauren, & Colby Smith. 2023, “Will US voters believe they are better off with Biden? Under pressure after a string of damning polls, the US president is resting his hopes for re-election on his personal economic blueprint”. Financial Times, November 6. https://www.ft.com/content/23687b6b-ac6f-46ab-a701-917a5ed64f4f>.
* Financial Times Editorial Board. 2024. “Why Biden gets little credit for a strong US economy: The president’s team needs to show more energy in addressing voters’ concerns”. Financial Times, January 11. https://www.ft.com/content/a2373c26-87ea-4b77-944f-8a6b28c8675b>.
* Ghosh, Bobby. 2022. “Biden’s a Better Economic Manager Than You Think:
On more than a dozen measures of relative prosperity, he’s outperformed the last six of his seven predecessors. On reducing the budget deficit, he has no peers”. Bloomberg, November 8.
* Greenberg, Stanley. 2024. “The Political Perils of Democrats’ Rose-Colored Glasses: Paul Krugman’s (and many Democrats’) beliefs about the economy and crime miss the reality that Americans still experience”. American Prospect, February 5. https://prospect.org/politics/2024-02-05-political-perils-democrats-rose-colored-glasses/>.
* Hsu, Joanne. 2024. “Surveys of Consumers: Final Results for January 2024”. February 2. http://www.
47 min