The Biden Recession Thread

[Just A UPS Guy]

Wages drive inflation also. The median hourly wage has increased more than 50% since 2019. Not to mention the cost of benefits that employers must pass to consumers to stay in business. The cost of capital has gone up with the rate hikes. Companies that can't fund their own expansion or retooling must borrow to build their businesses. Once wages stabilize, inflation will settle back into normal yearly ranges.

Right, but the 25%+ increases in daily living are here to stay and those left behind will be just that, left behind. We'll all have to ford the river and cover the shortfalls of the lower class. Again. Only this time, it will be a much larger percentage of the population, so a much bigger bill. We're ed.

 

[Up In Smoke]

And don’t forget about the PPP loan scam, it was promised to help the small people instead it was a boondoggle and a giveaway to the Uber wealthy and scam artists. Robinhood in reverse, take from the poor and give to the rich.

Money was pouring into businesses with no oversight. We had no idea how to spend it or if it was going to be recalled after the pandemic was over. Our accountant had us set it aside until we had answers. The full forgiveness letters and emails came out in September and we were floored that we were allowed to keep it.

 

[Thebrownblob]

Right, but the 25%+ increases in daily living are here to stay and those left behind will be just that, left behind. We'll all have to ford the river and cover the shortfalls of the lower class. Again. Only this time, it will be a much larger percentage of the population, so a much bigger bill. We're ed.

Correct, inflation that has already happened will not go away. It’s here to stay and the little people are that much further behind.. we will not know the full effect for several years of this. extreme perioid inflation we went through.

 

[Thebrownblob]

Money was pouring into businesses with no oversight. We had no idea how to spend it or if it was going to be recalled after the pandemic was over. Our accountant had us set it aside until we had answers. The full forgiveness letters and emails came out in September and we were floored that we were allowed to keep it.

So you got a PPP loan? Trust me, I know all about them. Use it or lose it.

 

[bbsam]

I'm just saying that's the only fix for the last three years of inflation. We're up well over 20% and still seeing 3%+ yoy with every report. The only way to get that back is to burn it all. Basically, $130k is the new $100k salary.

I wonder if Wall Street will come to a similar conclusion. That quarterly reports will show less profit.

 

[Thebrownblob]

I wonder if Wall Street will come to a similar conclusion. That quarterly reports will show less profit.

The stock market gains have been great and make my 401(k) and other investments look really great. But you can’t help but feel like the head is disconnected from the body. Don’t get me wrong. I hope it continues. But It just doesn’t seem possible.

 

[bbsam]

The stock market gains have been great and make my 401(k) and other investments look really great. But you can’t help but feel like the head is disconnected from the body. Don’t get me wrong. I hope it continues. But It just doesn’t seem possible.

Right. And that’s my general conclusion about the economy and politics. They are connected but seem for the American people to be inversely affected. It doesn’t matter that economic numbers are actually good, people feel just the opposite.

 

[Up In Smoke]

Hmmmm chicken, or the egg which came first?

In 2021 some 7 million people returned to the job market and businesses were competing for their services. National average wages grew from 54K pre-pandemic to 61K by the end of 2021. Inflation first out paced wages in March of 2022.

 

[Just A UPS Guy]

I wonder if Wall Street will come to a similar conclusion. That quarterly reports will show less profit.

Dude, imagine if wall street had to meet main street in the middle...billionaire heads detonating by the second.

 

[bbsam]

Dude, imagine if wall street had to meet main street in the middle...billionaire heads detonating by the second.

Don’t tease.

 

[Up In Smoke]

So you got a PPP loan? Trust me, I know all about them. Use it or lose it.

Yes, our accountant applied for all the small business programs that were available. Not knowing what was going to happen caused a little panic across businesses of every size. Loans were based on our 2018 returns and the money flowed in. Our businesses were never affected in a negative way and still we were allowed to keep the funds.

 

[Thebrownblob]

Yes, our accountant applied for all the small business programs that were available. Not knowing what was going to happen caused a little panic across businesses of every size. Loans were based on our 2018 returns and the money flowed in. Our businesses were never affected in a negative way and still we were allowed to keep the funds.

Yep, I know all about it, that’s why I called it a boondoggle and that’s why I don’t blame one particular party or one particular president. They are playing tag team with bad decisions.

 

[Up In Smoke]

Right, but the 25%+ increases in daily living are here to stay and those left behind will be just that, left behind. We'll all have to ford the river and cover the shortfalls of the lower class. Again. Only this time, it will be a much larger percentage of the population, so a much bigger bill. We're ed.

The 80s inflation and recession was much worse and somehow we pulled through. The tax and spend avenue that was used in the 80s probably shouldn't be used today though.

 

[Thebrownblob]

The 80s inflation and recession was much worse and somehow we pulled through. The tax and spend avenue that was used in the 80s probably shouldn't be used today though.

Time will tell.

 

[Just A UPS Guy]

The 80s inflation and recession was much worse and somehow we pulled through. The tax and spend avenue that was used in the 80s probably shouldn't be used today though.

I'm definitely not saying we won't press on, I'm just not sure how clean any of us will come out of this. It could be ugly for a long time.

 

[Up In Smoke]

I'm definitely not saying we won't press on, I'm just not sure how clean any of us will come out of this. It could be ugly for a long time.

My first car was a Datsun B210 in 1983. Please God don't let it get that bad again.

 

[bbsam]

The 80s inflation and recession was much worse and somehow we pulled through. The tax and spend avenue that was used in the 80s probably shouldn't be used today though.

I think the problem this time is that the Fed has already used its tool kit. What good do low interest rates do if the products are already out of reach for most people?

 

[Up In Smoke]

I think the problem this time is that the Fed has already used its tool kit. What good do low interest rates do if the products are already out of reach for most people?

The reversal in Fed policy in early 2019 is proving to be a costly one. The Fed felt pressured to save the stock market by lowering rates and we lost control of spending. A little pain in 2019 would most likely have helped our cause today. Monday morning quarterbacking.

 

[bbsam]

My first car was a Datsun B210 in 1983. Please God don't let it get that bad again.

I had a 1980 and a 1981 Corolla. Loved those. Rear wheel drive and about 60hp. Great fun in the snow and you couldn’t get into too much trouble.

 

[Ou812fu]

Us personally, yes. Our business revenues have out paced the cost of operating, our properties have gained nearly 50% greater valuations and our personal wealth is up well beyond any inflation measures. To be fair, other than the property values, our numbers are pretty steady going back 20ish years.

If the value of the dollar was increasing? You wouldn't have to pay more for stuff. It would become cheaper.