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Sunday, August 16, 2020

Recession proof

Or maybe not. Remember how I pointed out that there was going to be a crash this year? Now consider what Goldman Sachs was saying at the end of December:
Just months after almost everyone on Wall Street worried that a recession was just around the corner, Goldman Sachs said a downturn is unlikely over the next several years.

In fact, the firm’s economists stopped just short of saying that the U.S. economy is recession-proof.

An analysis Goldman conducted of the current potential risks to growth show that they are mostly muted. The report found that the pillars of the “Great Moderation” that began in the 1980s — low levels of volatility marked by sustainable growth and muted inflation, interrupted only by the financial crisis more than a decade ago — are still standing.

Investors could be excused for getting a little nervous over such calls, as optimism also was heavy in late 2007, just as the economy was about to enter the worst of the financial crisis.
So much for those "mostly muted" risks to growth.

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39 Comments:

Blogger Jpc August 16, 2020 1:24 PM  

Goldman Sachs says!
That's enough.

Blogger Jpc August 16, 2020 1:25 PM  

Goldman Sachs says!
That's enough.
Time to head to the exit.

Blogger Jack Amok August 16, 2020 1:26 PM  

Listening to advice from an investment house is sort of like getting the Chef's Special at a restaurant. It might be good, it might be bad, but what it really is is whatever they have too much of on hand and are trying to sell.

Blogger Shane Bradman August 16, 2020 1:26 PM  

The funny thing about Black Swan events is that always occur.

Blogger D E K August 16, 2020 1:39 PM  

Any insight if there will be another stock crash this year? Even a minor one before the election? Or is the plethora of money ending all deflation in any asset class?

Blogger Unknown August 16, 2020 1:46 PM  

The economy is recession proof because the investor class has convinced America to bank its life savings on the stock market, bonds, and other financial vehicles. Collapse of the market will immiserate most Americans. With so many people buying in, the financial elites can effectively spread out the damage to everyone else when the debt balloon comes crashing down. "Mostly muted" risks comes from socializing most of the risk while privatizing most of the reward. It's a sweet game as long as you keep people buying in.

Blogger FUBARwest August 16, 2020 1:51 PM  

Is Black Swan the right terminology for willfully ignorance?

Blogger Canadian Warlord August 16, 2020 1:53 PM  

The last bailout, Goldman Sachs recorded record profits. They like the looks of this situation.

Blogger Hammerli 280 August 16, 2020 1:54 PM  

The question is, will the market tank...or BE tanked. Deliberately.

Remember, America's Pain is the Liberal's Gain. And they will do all the damage their Propaganda Press operatives can deflect the blame for to get and keep power.

Blogger Jeff aka Orville August 16, 2020 1:59 PM  

Even Buffet is trading Goldman Sachs for Gold. https://fortune.com/2020/08/14/warren-buffett-goldman-sachs-gold-berkshire-hathaway-portfolio-occidental-stock-wells-fargo-jp-morgan-kroger/

If it were up to Trump he'd probably stall a crash until after the election, but the deep state would certainly like one before the election.

Anonymous Anonymous August 16, 2020 2:00 PM  

Chef’s Special = leftovers.

Goldman Sachs economic forecasts = electric koolaid laced with cyanide.

You’d be better off with the cockroach crunch from Homeless Mo’s Dumpster Rat Roast.

Blogger Karen August 16, 2020 2:00 PM  

How has it evolved?.

Blogger Joe Smith August 16, 2020 2:07 PM  

What they're willing to say publicly vs. what they actually think. Would anyone be surprised if it turned out they were touting the strength of the American economy while all their investments were happening in Europe or Asia or whatever? They lie habitually.

Blogger bramley bramley bramley August 16, 2020 2:23 PM  

'Great moderation' is what they call the grabbling? Thank god we aren't seeing their immoderate behaviour then.

Blogger Brett baker August 16, 2020 2:24 PM  

They have faith in Their Man At Treasury. Sometimes you have to give Goldman Sachs more credit than they give you.

Blogger Gettimothy August 16, 2020 2:41 PM  

"Fuck You Bernanke"

and

"BTFD"

Adeiu, We knew ye well.



Blogger NRx August 16, 2020 2:44 PM  

The only reason there was a crash was because of the democrat hoax pandemic, Trump will win anyway but he messed up big by not trying harder to prevent the lockdowns.

People in so called public health jobs need to join progressives, communists, feminists "climate scientists" on the helicopters.

Blogger Gettimothy August 16, 2020 2:46 PM  

there has never been a better time to be poor; no skin in the game, no stonks, no bonds, no deluberatives, no SS , no IRA, and a little change in my pocket going jinga linga ling.

Blogger LZ August 16, 2020 2:50 PM  

China is worried about food price inflation. They also slowed money supply and credit growth in July, plus started cracking down on real estate and stock speculation. M2 growth over the past 3 months is at pre-coronavirus levels associated with a Chinese (and German) manufacturing sector locked in contraction as measured by PMIs.

Blogger urthshu August 16, 2020 2:54 PM  

Bad sign. It's like how politicians say everything is fine as they step into the last plane out

Blogger Beau August 16, 2020 2:58 PM  

OT

Just caught up with James who reported Jeremy is now preaching the gospel at a church in San Diego. A few years back Jeremy arrived at our place in a multicolored mohawk in cuffs. Jesus saves.

Blogger Ariadne Umbrella August 16, 2020 3:16 PM  

https://www.insider.com/disney-princess-jobs-2018-5#merida-two-time-olympian-archery-and-equestrian-13

off topic, devil mouse, brainwashing young women away from motherhood and babies division: trade your entire family's future for shiny trinkets!!1

Blogger Ken Prescott August 16, 2020 3:19 PM  

Back in the day, Goldman Sachs was touting $200 a barrel as their target for oil--it was trading at $125--while they were holding a massive short position.

Blogger Chiva August 16, 2020 3:20 PM  

@Beau
Our Lord is good. Jesus saves.

Blogger Unknown August 16, 2020 3:26 PM  

15. Brett baker August 16, 2020 2:24 PM
Sometimes you have to give Goldman Sachs more credit than they give you.



Goldman forecasts are exclusively used to encourage their muppets to "invest" in garbage that Goldman is trying to get off of their own books.

they've been doing this for decades now.

pretty much the best investment advice you can get is the reverse of whatever Goldman is saying in public. that's probably neck and neck with knowing what Congressmen are investing / devesting in.

Blogger Doktor Jeep August 16, 2020 3:29 PM  

Well ACKtually...
You can't have a recession when you already have a collapse.
*Laughs in gamma

Blogger Jack Amok August 16, 2020 4:16 PM  

Is Black Swan the right terminology for willfully ignorance?

Yes. Pretty much the definition of it. A Black Swan event is something not predicted by people willfully ignorant that tomorrow will eventually not be like today.

Blogger Unknown August 16, 2020 4:19 PM  

15. Brett baker August 16, 2020 2:24 PM
Sometimes you have to give Goldman Sachs more credit than they give you.



Goldman forecasts are exclusively used to encourage their muppets to "invest" in garbage that Goldman is trying to get off of their own books.

they've been doing this for decades now.

pretty much the best investment advice you can get is the reverse of whatever Goldman is saying in public. that's probably neck and neck with knowing what Congressmen are investing / devesting in

Blogger Jack Amok August 16, 2020 4:19 PM  

Goldman forecasts are exclusively used to encourage their muppets to "invest" in garbage that Goldman is trying to get off of their own books.

"Push the halibut Maury. It's only good for one more day before it starts to stink."

Blogger "William Berke" August 16, 2020 4:24 PM  

"In fact, the firm’s economists stopped just short of saying that the U.S. economy is recession-proof."
Why not just quit writing in English?

Blogger "William Berke" August 16, 2020 4:47 PM  

Stock markets crash to consolidate publican margins to foreign capital.

Blogger Rek. August 16, 2020 7:35 PM  

Skin in the game. Make predictions, pay the price!! All Goldman employees, top to bottom, should be fired, assets liquidated and pay reparations.

Blogger crescent wrench August 16, 2020 7:45 PM  

Many have warned our elites would engineer economic disaster to punish the dirty proles for daring to reject them.

Now we get to see, particularly in the UK and the USA, whether the public still has the spirit to raise the middle finger a second time and send them packing for good.

Blogger RedJack August 16, 2020 7:48 PM  

In my industry, all .gov contracts are drying up. Stuff that "always sells".
Ag is hammered, and the Iowa Hurricane had little effect on crop prices.
Commercial real estate from store fronts to offices to restaurants is looking VERY grim. They are talking about using old JC Penny's stores as Amazon warehouses, which only makes sense if the rental market is gone.
Yeah, but all is well!

Blogger JamesB.BKK August 16, 2020 9:28 PM  

Within those three asset classes of stocks, bonds, and other are good investments, bad investments, and middling investments. These are relevant for those with savings and with inflation ever at their door. What will hurt most people living in America are (some) collapsed pension funds, (some) collapsed cities, (some) collapsed government borrowing schemes (represented by poor and declining quality bonds and what we are ceaselessly told are the Best and Most Indispensable Asset Ever (Full Faith and Credit US bonds, bills, and notes - which are Guaranteed By Threats at Gunpoint To Pay Up Bub Against Those Born and Yet Unborn)), misbehavior, and a change of the guard. As before always there would be pockets of productivity among the befuddled, which the befuddled will likely try to attack.

Blogger Ransom Smith August 16, 2020 9:51 PM  

Many have warned our elites would engineer economic disaster to punish the dirty proles for daring to reject them.
But they're doing it wrong. The smart ploy would be to destroy the economy and swiftly implement UBI to make everyone a subservient prole.
But instead they're not even paying that and seem to want the whole pie.

Blogger Oswald August 16, 2020 11:46 PM  

This is exactly what they are suppose to say. If they said we were heading for a downturn, this would actually help Trump, because no one believes Biden is better on the economy. But if we are not headed for a downturn, then it is now safe to vote for Biden, because he won't be called upon to save us from an economic downturn. This is the exact statement they needed to make to hurt Trump.

Blogger Tars Tarkas August 17, 2020 10:27 AM  

What are they talking about? The US has been in liquidation for most of this time. Everything that could be sold or monetized is being sold or monetized. People and corporations are up to their necks in debt. Outside of technology, everything has more than doubled in price during that time. The average home price was 47k in 1980 and is 381k today. A new car was 7k in 1980 and 37k today. That was the period of "low" inflation. In 1980 we were the largest manufacturer in the world and the world's largest creditor nation. Today we are a nation of debtors with a large trade deficit. Despite the large increases in costs, income has been stagnet with the lower and middle classes going from 21,336 and 61,832 to 24,074 and 73,392 respectively.
In the 80s the future was so bright, we had to wear shades. Now, the future is so bleak, we gotta wear masks.

Blogger JamesB.BKK August 18, 2020 4:03 AM  

Outside of technology, everything has more than doubled in price during that time.

Bill Bonnie would concur. George Gilder would strongly oppose on grounds that (i) you've not accounted for improvements in quality and technology incorporated into everything else during that period and (ii) you've not accounted for prices in terms of time worked to acquire but have instead used relentlessly debased currency units. Of course where government has been a buyer or guarantor of buyers prices have increased in monetary terms by much more than 100% for sometimes lower quality during that period.

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