Did the Media Almost Talk America Into a Recession in December?
Every day, I toggle the channels and listen to different news broadcasts, and there is no doubt it has become decidedly more negative; lurching more toward opinion than journalism. In late November, with the market slipping from concerns over the Federal Reserve, the media took to warning America that a recession is imminent.
There was a time when the notion that anyone was rooting for a recession would have been far-fetched. Last June, comedian Bill Maher shared out loud the sentiments many others were harboring:
I feel like the bottom has to fall out at some point…and by the way, I'm hoping for it because one way you get rid of Trump is a crashing economy.
Sorry if that hurts people, but it's either root for a recession or you lose your democracy.
Maybe it wasn’t everyone’s intention, but the media jumped on the recession bandwagon in late November and December. I think they almost made it a self-fulfilling prophecy.
Check out these headlines from the New York Times:
For the American Economy, Storm Clouds on the Horizon
Nov. 28, 2018
The Stock Market’s Dangers Are Easier to See Now
Nov. 30, 2018
American Capitalism Isn’t Working.
Dec. 03, 2018
What Is a Recession, and Why Are People Talking About the Next One?
Dec. 17, 2018
It wasn’t just the New York Times, of course
Trump’s big 2020 problem: The economy could be in recession
November 13, 2018
Many factors will impact the 2020 race for both parties: the Mueller investigation, House investigations, a recession, and a growing deficit.
November 21, 2019
In the Real World
While all these headlines were blaring away in the month of December, America was enjoying amazing economic growth:
On Friday, we learned that personal income surged in December 1.0% or 150% better than expected, but spending plunged 0.5% as savings rocketed to 7.1% from 6.1%. I cannot remember the last time there was such a dramatic shift in savings, especially with wages erupting higher, and in December no less!
Initially, I thought the fret on Main Street was about the stock market. The Dow Jones Industrial Average was down -7.5% for the month. However, not enough Americans are in the market to have that kind of knee-jerk reaction.
I’m not sure how close we were to a recession, but I am now convinced the market swoon and retreat of consumers was a mini-panic triggered by America’s press.
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