On The Market

New Recession Indicator Shows Americans Worse Off Than We Thought

16 snips
Nov 11, 2025
A new recession indicator reveals that average Americans face financial struggles often overlooked by official reports. Conflicting predictions from major banks raise questions about the true state of the economy. The old two-quarter GDP rule fails to capture everyday realities, while historical analysis shows more prolonged hardships than documented. Surprisingly, despite current stability, looming risks threaten real wage growth. Listeners are encouraged to focus on smart investments, particularly in real estate, to safeguard their wealth.
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INSIGHT

Recessions Are Subjective By Design

  • The official U.S. recession definition is subjective and decided retroactively by the NBER based on depth, diffusion, and duration.
  • This subjectivity creates widespread disagreement and delayed recognition of recessions.
INSIGHT

GDP Misses Average Americans' Well-Being

  • GDP measures total economic output but omits measures of average Americans' financial well-being like savings and net worth.
  • Relying on GDP can mask worsening living standards even as output grows.
ADVICE

Track Real Wages And Unemployment

  • Measure the economy by whether the average person's spending power (real wage growth) is rising or falling.
  • Track unemployment trends alongside wages to gauge whether ordinary Americans are improving financially.
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