November CPI figures came in yesterday at 7.1%, lower than most expectations of 7.3%. That’s down almost 22% from 9.1% in June, at this pace of decline, inflation could hit 2% by the end of 2023.
The Least Surprising Event In History?
When and/or if a recession hits the US – although the definition of recession keeps evolving too – it will have to be the least surprising event in history. Never before in my half-century-plus of life have I heard the word ‘recession’ uttered, printed, or broadcast more than in the past 6 months.
Predicting a coming recession does not require being a genius. A recession is 100% guaranteed. When that happens is guesswork and involves numerous indicators and conditions, although a ‘shock to the system’ or a ‘surprise’ can trigger one more unexpectedly. Covid lockdowns triggered a recession. Recessions are also susceptible to business cycles when economies are forced into ‘cool down’ mode after overheating and the money supply is tightened.
Frankly, while all this recession-predicting and chatter is annoying and a bit of a downer, it is not too unlike being warned about anything early: preparing for a big hurricane with many days of warning allows people to board up homes and do all sorts of things more calmly and thoroughly. Discovering and diagnosing a health issue very early usually allows for a better and more effective cure too.
So maybe while we bemoan all this ceaseless recession chatter – and the approach of a recession now, 2 months, 2 years, or 2 decades from now – maybe we should celebrate the fact that collectively we are all acutely aware of its potential, and because of this we are being forced to be proactively defensive, prudent, careful, fiscally conservative, not arrogant, etc. A little fear can prevent all sorts of bad behaviors and encourage more creativity, innovation, proactive thinking and actions, and hard work. And maybe a bit more appreciation for the ‘good times’?
