Are we seeing early signs of our next recession?

[countrygirl2]

A big problem here is little wage growth, was listening today how well England is doing and they said part of it

was the big rise in wages, that part apparently is not happening here even though we face shortages of people.

When will wages ever keep up with inflation?

Also CBO said tax receipts are really declining, that means more borrowing and that will mean higher interest rates

doesn't take long for the economy to hurt with that combination low wage growth and high interest and prices for

the multitudes. And then the repubs will start in on cutting SS, medicare, and Medicaid again and that will take more

money out of the economy.

Yes I think a recession is on the way, can't say how long but then all this is cyclical anyway.  The cycle will probably

swing about the time the dems get in and of course they will get the blame, but will dig us out again, and it will all

rinse and repeat.

[Tiny]

I think inflation is starting to rear it's ugly head...

I bought fast food a couple times this week and I paid nearly .50 cents more for the same stuff (at each fast food outlet) than

I paid  back in December 2017. I'm sure it wasn't a .50 price jump all at once - but a nickel here and dime there over the last 5 to 6 months.

Gas prices have also gone up and stayed up during the last 6 weeks (previously the price would go up and then drop back).

Grocery prices seem to have gone up noticiably, too, without any drop back to a lower over all price.

My local real-estate market has gone from frothy to bubbly... I'm not sure who can afford the houses that are up for sale (and are being purchased). 

My brother also recently lamented that a $20 bill is the new $5.00 bill... meaning he use to think spending $5.00 on something 'everyday' or "convenient" or for entertainment or for something disposable (basically throwing away $5.00) - wasn't so bad...  but now - he's  spending $20's on stuff that doesn't matter and like the $20 doesn't really matter.

Not sure what all this means... but it's definitely different than it was 6 months ago.

[haapai]

I'm seeing the same small price increases on fairly staple products but what worries me most is the return of silly and dangerous articles about real estate.  Maybe I'm clicking on the ones with the most irresponsible-sounding previews in order to horrify myself, but it feels like the madness is creeping back. 

The articles that I am reading regarding real estate also have another curious characteristic -- they're definitely pitched at slightly down-market fools.  In other words, they're what we saw at the very end of the last bubble except this time I never saw the bubble. 

[countrygirl2]

I see grocery prices on the rise or maybe in our small town. I bought 2 apples for DD's lunch $1.72, and 2 packages of

strawberrys $3.99 each. I saw another sign and thought they were 2 for $3.00, thought my bill was awfully high so looked

at the receipt in the car. Surely a mistake so went back in to look at the sign, no my, would not have bought them. This

store is outrageous, but the only complete merchandise one in town. I can buy milk cheap but like organic so we pay a ton

for that, $3 to 4.99 a half gallon and organic eggs.  Those 2 are my very expensive purchases, just think they are healthier.

I do buy the less expensive regular milk at times as we drink a lot and that is a load to pay.

[verrip1]

Feb 6, 2018 13:47:16 GMT -5 wyouser said:

Times change...that much is constant, but I do not think we are on the brink of another recession. The underlying economy is strengthening.

True then.

Truer now.

All the fundamental parameters, except one, are strong.  That exception would be the slow trend towards a flat yield curve that might turn inverted.  The Fed's toolbox can be put into play should that be a worry.

Not sure if we've shaken out all the frightened money yet for the post-correction, bullish rebound.

What the fuck, if it goes to hell in a handbasket, blame Trump! 

[Tiny]

It's mighty nice I got big raise at the end of 2018... unfortunately the higher net amount that was showing up in my paycheck  has quickly got eaten up over the last few months by the never ending slow increases in my "fixed" expenses...   

Yeah, I think the economy is going gangbusters - but I don't have any extra money to spend...  and I'm in a good financial position.  I can't imagine how pissed somone who got a big raise might be - thinking "finally" they can 'catch up' or take a breathe... only to realize they are still in the same spot.   

I'm not sure how this "making more money" but not really able to BUY more stuff will effect the economy in future months. 

I assume I'm not the only person experiencing this "yeah! I have more money - but oh look - all my expenses went up and now I've only got an extra $20 a month." 

 

[Tiny]

Apr 19, 2018 19:00:38 GMT -5 haapai said:

I'm seeing the same small price increases on fairly staple products but what worries me most is the return of silly and dangerous articles about real estate.  Maybe I'm clicking on the ones with the most irresponsible-sounding previews in order to horrify myself, but it feels like the madness is creeping back. 

The articles that I am reading regarding real estate also have another curious characteristic -- they're definitely pitched at slightly down-market fools.  In other words, they're what we saw at the very end of the last bubble except this time I never saw the bubble. 

Just a general comment - I noticed this, too. The pitch being kind of "people who own houses build more wealth - so if you are teetering on the edge of financial ruin,  buying a house will help you build wealth!" 

I'm also getting deluged with snail mail and phone calls from "Investors" who want to buy a house I own (all of them - the slum, the shack, and my actual house).  I assume a lot of people have taken the course on how to flip houses and are scouring public records and sending out cards, letters, and phone calls to every address they can find.    Personally, it smells of desperation to me... how will dozens of newbie investors make money when they have to compete with the established  existing flippers who already work with the real estate agents/banks/etc...)  There's not enough flippable houses to go around. 

Real Estate is getting  bubbly...

[countrygirl2]

In Texas just got another tax increase for a lot, yes a 1/3 acre lot I rent to people with a mobile home. A couple years ago I offered to sell it to those folks for $30k, in the last 2 years the taxable value is now $45k and a few months ago was offered $40k for it and the deal included renting it to the people that are on it for 2 more years at the same price.  It's on a corner near Frisco, Texas and we think that corner will one day be a strip center or business.  I am going to have to raise their rent again and never had too till last year.  I'm glad we sold everything else down there, they raised the taxes on another property 600% and that area goes in and out of housing crashes, so likely coming close again.

[countrygirl2]

I keep reading about inverted yield curves and hearing about them, they said this is a precursor to a recession

when this happens and its happening now.  I had to read up on it, apparently its when current interest rates are

higher then future ones. But everything is so wishy washy now, with trump you don't know from day to day,

so money people are nervous. Friday all the markets were down prices for commodities were too.

[countrygirl2]

Let's see its just getting worse the dow and everything is going DOWN, yesterday and today.  Will it correct or not upwards?

Or has trumps mess finally gotten everyone so scared they are just dumping and will keep dumping?  Hard to say. No  one

seems to know what his policies are from day to day. Does he even have a policy?  They are saying now on squawk alley the

Chinese are waiting to see what his trade policies really are. Trouble is those negotiators may agree to something and he changes

it the next day.

[busymom]

I mentioned this on another thread, but I'll put it down here, too.  IMHO, we're seeing some evidence of going back into recession, at least in our area.  I drove to a mall I'm familiar with, in an expensive-to-live-in area, and since approximately the 2017 holiday shopping season, that mall has lost around 8-9 smaller stores.  I have to mention that this is one of "those" malls that never seems to have any vacancies, and considering that is a "moneyed" part of town, I'm putting my money on another recession.  Courtesy of Trump.     (The only promising thing is there are still "help wanted" signs in some of the stores.  Once those disappear, I'll officially declare "recession".)

[countrygirl2]

I feel very sure he will drive us into a recession or worse.  Really think its a no brainer plus repubs always

seem to make good times into bad with their foolish policies.  This one doesn't even know what his polices

are.

[Tiny]

Retail is changing and it's the main employer in the local suburbs (there's little to no manufacturing) 

The local mall is hitting harder times - Carsons is closing and Sears and JC Penney are struggling   those are the 3 anchor stores.     I haven't been in the mall in over a decade - because I'm not the target audience.   I know the Cinemas and newly enlarged/renamed Food Hall are doing great.   Not sure what's in the rest of the stores there.    On the other hand there's a new, big, stand alone Costco and  a little ways away a Binny's (converted an existing empty retail building)  and one of the oldest local shopping "strip mall"  that had 50% or less leased for decades has been  renovated and is at 100% leased store fronts plus they added new out lots with new restaurants.    So, it's more of retail changing rather than dying.

Not sure what the tax implications/employment needs  are with the new types of retail.   If these new businesses are hiring fewer people (or more people but at lower wages) and/or if the businesses aren't generating much in the way of taxes for our suburbs -- then it's a problem. 

I'll admit, I'm kind of amazed at how many restaurants there are... there's a newly built strip mall that's ALL restaurants (pizza, wings, coffee, sports bar, and two others I can't remember...) I'm wondering how everyone affords eating out so often. 

Oh, and there's brisk sales of 350K and up houses... in an area that's got a median income of 60K.  The last time that ratio happened was when the national housing crisis happened.    Maybe this time people really do have higher incomes??  OK, maybe gentrification is finally hitting my suburb...

[busymom]

I know, Tiny.  All of the new construction around here is $300,000 and higher, and this area is mostly middle class.  Not sure who can afford these houses.  I'm actually expecting to see a few of those newly-purchased homes in foreclosure in the next few years.  I can see the bubble...

[Deleted]

I just sold 150k worth of stock today to buy a townhome.  Found out yesterday my landlord is booting me at the end of my lease because they are moving into my unit.

A lot of places in IL are still below their pre recession prices so I'm not as worried about a bubble as a lot of other places.  I can't market time and I know it will set some folks in here undies on fire not taking out a mortgage but it actually felt pretty good getting out of the market with that money.

[countrygirl2]

Not me, I think folks need to stay out of debt. We are going forward into what I feel will be very bad times. Here in Indiana because they gave farmers a huge property tax bill cut they are talking raising taxes for the rest of us over the next 5 years. The school corporation I went to is losing so much money plus from private church schools they are likely going to close down in the next few years. Looks like we may have only 1 corporation for the whole county. May not be so bad for the high schools but sure is for the little kids that are up in the middle of  the night and bussed miles and for parents trying to work and go to their activities. I'm sure the county ill lose even more people over it.

[Shooby]

Yeah under 4% unemployment!! lol!!

[kadee79]

May 6, 2018 18:36:21 GMT -5 Shooby said:

Yeah under 4% unemployment!! lol!!

Only because so many quit looking.

ETA....On another note, I'm seeing more "For Sale" signs in my area than I did during the 'bubble'.  I'm not into real estate so not exactly sure what is going on.  We just had a new medical school (for D.O.s) break ground the other day, so there will be more housing needed for both teachers & students.

[countrygirl2]

It will go down, don't know when but trumps up and down "policies" are not sustainable.  I hope I am wrong.

[tyfighter3]

LOL, you people need to read the last housing report that is out. Recession? We are not even close to it.

[Deleted]

May 21, 2018 8:55:39 GMT -5 tyfighter3 said:

LOL, you people need to read the last housing report that is out. Recession? We are not even close to it.

2006 says hello.

[tyfighter3]

We are going back to the OLD MSN board.

[countrygirl2]

WSJ said interest rates are at a 7 year high and going higher, its going to dampen the housing market as it goes up.


Here and other places property taxes are raising, gas is nearing $3 a gallon, groceries are really rising.  Insurance is

always going up.  I guess in your world none of this counts.  Also rents have to increase as all the holding costs do.

[bean29]

Our Property Taxes are insanely high. Our Assessment is ridiculous. But, if I put my house up for sale, it would probably sell for more than the assessed value, but I am not 100% sure. If I want an equivalent house I would have to sell and then look for another house - I am not sure I can replace it for what I can sell it for, so we are staying.

My objection to my property taxes is two fold. It is the amount (about $7,500) and equitableness between neighboring properties. We have pulled permits to finish the basement etc. Neighbors did not, so I am assessed for an extra 1,000+ square feet.  Most of the neighbors have exactly what we have (finished basement) and they started out with bigger houses - so my assessment should not be the highest on the two streets my corner house sits on.

The housing market in my city is hot, and likely to remain so at least another year or two. We have 3 new medical facilities and a very large retail/mixed use development that includes stores like Meijer, Woodman's and fast food outlets, banks, pet stores, mattress stores, IKEA, hotels and other businesses and higher end housing.  The higher end housing is being snapped up as fast as it is available so they are building more. Also they have built and extened stay hotel and now they are builing another hotel - probably b/c of IKEA...but we are also pretty close to the airport.

[Tiny]

There's low unemployment numbers  --  but I kind of question them... I  know a lot of Married Double Income couples who became Single income couples as a result of the recession and they are still Single Income even though they'd like to be Double Income again.   I also keep hearing that there are jobs but they aren't "a stepping stone on a career path" jobs - they are dead end jobs.

There's also the weirdness of low unemployment but the US Debt keeps going up!   Shouldn't it be the other way around?   Isn't times of low unemployment when the US pays down (or doesn't incur as much) debt   What happens when the next recession comes around?  The Government isn't going to be create debt to help ease the recession or pull us out of it....  Well, they will - but then the Debt will be even  bigger.

[countrygirl2]

WSJ today said last 2 months unemployment is up. The rising interest rates are going to threaten housing sales soon, but also said housing prices

are way up, something doesn't jive there. Also expect an interest rate hike again soon. Of course inflation is rearing its head. 

I've read consumer debt is at a high again, when folks have to pay that high interest on their consumer debt, going to eat them alive. And now

we just spent $70 to fill up our vehicles each. That has got to hurt folks commuting.  All this stuff is cyclical, the only thing different anymore is

most people don't get COL raises to offset inflation.

[Deleted]

May 22, 2018 11:35:31 GMT -5 Tiny said:

There's low unemployment numbers  --  but I kind of question them... I  know a lot of Married Double Income couples who became Single income couples as a result of the recession and they are still Single Income even though they'd like to be Double Income again.   I also keep hearing that there are jobs but they aren't "a stepping stone on a career path" jobs - they are dead end jobs.

There's also the weirdness of low unemployment but the US Debt keeps going up!   Shouldn't it be the other way around?   Isn't times of low unemployment when the US pays down (or doesn't incur as much) debt   What happens when the next recession comes around?  The Government isn't going to be create debt to help ease the recession or pull us out of it....  Well, they will - but then the Debt will be even  bigger.

Quantitative easing to reduce the expense of the debt maintenance.   

[Deleted]

May 26, 2018 23:55:29 GMT -5 countrygirl2 said:

WSJ today said last 2 months unemployment is up. The rising interest rates are going to threaten housing sales soon, but also said housing prices

are way up, something doesn't jive there. Also expect an interest rate hike again soon. Of course inflation is rearing its head. 

I've read consumer debt is at a high again, Don't spend money you don't have.  when folks have to pay that high interest on their consumer debt, going to eat them alive.  See the previous And now

we just spent $70 to fill up our vehicles each. Buy fuel efficient vehicles That has got to hurt folks commuting. See previous All this stuff is cyclical, the only thing different anymore is

most people don't get COL raises to offset inflation.  Inflation has been a fact of life since we went off the gold standard (1933)  Fiat money is valued at the whim of the government presenting it.  You want COL increases ?  You need to negotiate this upon taking your job, not after the fact.    


history.com/this-day-in-history/fdr-takes-united-states-off-gold-standard

You are claiming knowledge of cycles. Fuel prices always cycle. Why buy a vehicle that uses that much fuel ?

[countrygirl2]

My other one wasn't much better and it was a smaller car. We use these and where we live needed at least one 4 wheel drive.

We are talking more about moving to town, but hubs said the house we want would cost as much to build as this even if smaller on

less land and the town taxes are higher. This would be the ideal time to sell, the pool of nice homes here is really low right now and

people are still buying. Not sure where we would live in the interim, all our rentals are way to small and we would need storage. I

would not commit to build until this was sold as you never know it might not sell at all.

[Deleted]

May 29, 2018 19:34:18 GMT -5 countrygirl2 said:

My other one wasn't much better and it was a smaller car. We use these and where we live needed at least one 4 wheel drive.

We are talking more about moving to town, but hubs said the house we want would cost as much to build as this even if smaller on

less land and the town taxes are higher. This would be the ideal time to sell, the pool of nice homes here is really low right now and

people are still buying. Not sure where we would live in the interim, all our rentals are way to small and we would need storage. I

would not commit to build until this was sold as you never know it might not sell at all.

I wasn't trying to be obnoxious with my previous answer.  It's good to see the cycles, as to know what is coming.  Everything being rosy and looking good, is usually the sign of a peak in economic activity.  As usual at these times, I place a life sustaining amount of cash in a safety deposit box for a possible banking crises.  A couple of years worth of cash.  I lose through inflation, but it's a small % of my assets.