Data released this week showed a key manufacturing mark hitting a two-year low and mortgage volume at its lowest in 18 years.
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Don’t get too excited. It takes some time for the Federal Reserve to put the economy in recession.
I think in our sense of depression and recession...related to past experiences...I would question the definitions of the two in present-day society. There are people today, who haven’t worked for over a dozen years and live out of dad’s garage, with him giving them $300 a month for pizza and beer. There are people who make a combined income of $250,000 a year....yet because of car loans, college loans, house debt, and credit card loans...they have barely $300 a month to use for non-essentials. There are guys churning out $3,000 a week in illegal and illicit drug sale profits...yet they can’t really report it and they have to pay for everything with cash.
Even with the 2008 drop, which really were about constructed loan packages, which no one in the banking industry could really explain on profitability or risk...we are in a new era where old definitions no longer fit.
This FED is the best I have seen since Volcker was the chair.