{"id":24238,"date":"2017-06-25T18:56:25","date_gmt":"2017-06-25T23:56:25","guid":{"rendered":"http:\/\/olduvai.ca\/?p=24238"},"modified":"2017-06-25T18:56:25","modified_gmt":"2017-06-25T23:56:25","slug":"why-the-next-recession-will-morph-into-a-decades-long-depressionary-event-or-worse","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=24238","title":{"rendered":"Why The Next Recession Will Morph into a Decades Long Depressionary Event…Or Worse"},"content":{"rendered":"

Why The Next Recession Will Morph into a Decades Long Depressionary Event…Or Worse<\/a><\/h3>\n
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Economists spend inordinate time gauging the business cycle that they believe drives the US economy.\u00a0 However, the real engine running in the background\u00a0(and nearly entirely forgotten) is the population cycle.\u00a0 The positive population\u00a0cycle is such a long\u00a0running macro trend thousands of years in the offing\u00a0that it’s taken for granted.\u00a0 It\u00a0is wrongly assumed that upon every business cycle downturn, accommodative\u00a0monetary and fiscal policies will\u00a0ultimately spur greater demand\u00a0and restart the business cycle\u00a0once the excess capacity and\u00a0inventories are drawn down.\u00a0 However, I contend that the population cycle has been the primary factor in ending each recession…and this most macro of cycles is now rolling over. \u00a0Without this, America (nor the world)\u00a0will truly emerge from the next recession…instead it\u00a0will morph into an unending downward cycle of partial recoveries…contrary to all contemporary human experience.<\/p>\n

The evidence for my contention begins with the 25-54yr\/old US population, which peaked in December 2007 and remains below that peak ever since (this population is presently about 400k fewer than Dec of ’07).\u00a0 However, total US full time employment is now 3.6 million above the\u00a0previous peak in\u00a02007.\u00a0 This 25-54 to FT employment relationship is now 1:1…just as it was in 1980 and 1970.
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Annual change in 25-54yr\/old US population vs. annual change in total full time US employees (below). \u00a0The macro population cycle provided millions of new adults (consumers)\u00a0and their increased demand restarted the more frequent gyrations of the micro business cycles…until 2008 and again now in 2017.\u00a0 Some may take note that the Federal Reserve cost of money (the Federal Funds Rate in blue) generally followed the population cycle,\u00a0only making some deviations\u00a0for the business cycle along the way.But the change per 8 year periods of the 25-54yr\/old population and total US full time employment turns out to be not so dissimilar. \u00a0In fact, it’s a pretty nice correlation.<\/div>\n
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…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Why The Next Recession Will Morph into a Decades Long Depressionary Event…Or Worse Economists spend inordinate time gauging the business cycle that they believe drives the US economy.\u00a0 However, the real engine running in the background\u00a0(and nearly entirely forgotten) is the population cycle.\u00a0 The positive population\u00a0cycle is such a long\u00a0running macro trend thousands of years […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2310,14704,1264,841],"class_list":["post-24238","post","type-post","status-publish","format-standard","hentry","category-economics","tag-depression","tag-economica","tag-recession","tag-us-economy"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24238","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=24238"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24238\/revisions"}],"predecessor-version":[{"id":24239,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24238\/revisions\/24239"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=24238"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=24238"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=24238"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}