10 thoughts on “My crystal ball takes a look at the Q4 employment level”
D_Ohrk_E1
Yet, the longer view shows something completely different.
If we open the window further and change it to an index set to 100 at April 2020 (the "end" of the pandemic recession per NBER), you can clearly see that we're not even close to matching very long term employment levels.
If you are to be believed that the business cycle will end soon, it will be the shortest on record in the last 40 years. Why -- because the Fed catastrophically raised rates too high? The past does not reflect that an effective rate at around 5% is a progenitor of a recession.
You need a new crystal ball.
skeptonomist
To predict the future you really need to have some knowledge of how things have worked in the past. The recent changes in employment level have no analogy since 1950 at least:
The "normal" pattern in rate of change is quite different from what has happened since 2019. The employment rate has just passed the pre-covid level and is not dangerously high:
As Kevin has said there are reasons for expecting a recession, for example the apparent determination of the Fed to cause one, but this extrapolation is not one of them.
joey5slice
Where are those parabolic trend lines you’ve grown so fond of recently?
James B. Shearer
"Where are those parabolic trend lines you’ve grown so fond of recently?"
He's fitting lines to the derivative so if you integrate back to the employment level (rather than the change in the employment level) you will get parabolas.
joey5slice
Aren't inflation metrics also measuring a rate of change? He has been using curved trend lines to show that inflation is actually about to end all on its own for over a year now.
Eve
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golack
So...unemployment starts to go up in Jan?
jeffreycmcmahon
The rare KD "That thing you're not worried about, here's why you should be (it doesn't worry me though)".
Special Newb
That trendline looks way way off.
mcbrie
Why assume an unbroken trend? Looks to me like two separate trends: steady decline from March to November 2022, then flat from then until now.
Yet, the longer view shows something completely different.
If we open the window further and change it to an index set to 100 at April 2020 (the "end" of the pandemic recession per NBER), you can clearly see that we're not even close to matching very long term employment levels.
If you are to be believed that the business cycle will end soon, it will be the shortest on record in the last 40 years. Why -- because the Fed catastrophically raised rates too high? The past does not reflect that an effective rate at around 5% is a progenitor of a recession.
You need a new crystal ball.
To predict the future you really need to have some knowledge of how things have worked in the past. The recent changes in employment level have no analogy since 1950 at least:
https://fred.stlouisfed.org/graph/?g=17ghi
The "normal" pattern in rate of change is quite different from what has happened since 2019. The employment rate has just passed the pre-covid level and is not dangerously high:
https://fred.stlouisfed.org/graph/?g=17ghv
As Kevin has said there are reasons for expecting a recession, for example the apparent determination of the Fed to cause one, but this extrapolation is not one of them.
Where are those parabolic trend lines you’ve grown so fond of recently?
"Where are those parabolic trend lines you’ve grown so fond of recently?"
He's fitting lines to the derivative so if you integrate back to the employment level (rather than the change in the employment level) you will get parabolas.
Aren't inflation metrics also measuring a rate of change? He has been using curved trend lines to show that inflation is actually about to end all on its own for over a year now.
Real on the web home based work to make more than $14k. Last month I made $15738 from this home job. Very simple and easy to do and procuring from this are just awesome.
For more detail visit the given interface.. http://incomebyus.blogspot.com
So...unemployment starts to go up in Jan?
The rare KD "That thing you're not worried about, here's why you should be (it doesn't worry me though)".
That trendline looks way way off.
Why assume an unbroken trend? Looks to me like two separate trends: steady decline from March to November 2022, then flat from then until now.