Plain English with Derek Thompson Experts Predicted a Recession This Year. How Were They So Wrong?
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Aug 8, 2023 
Jason Furman, a Harvard economist renowned for his expertise in macroeconomic policy, sheds light on the unexpected state of the U.S. economy in 2023. Instead of a recession, we've seen 'immaculate disinflation' with low unemployment, rising real wages, and falling inflation. Furman dissects why economists misjudged the economic landscape, the evolving influence of the Federal Reserve, and the role of global energy shifts in maintaining stability. Listen in as he unpacks the unpredictable nature of economic forecasts and consumer behavior's impact.
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Recession Prediction Failure
- Economists incorrectly predicted a 2023 recession with unusually high confidence.
- The actual outcome is "immaculate disinflation" with low unemployment and falling inflation.
Inflation and Recession Predictions
- Experts like Larry Summers accurately predicted inflation from Biden's stimulus but wrongly forecasted a necessary recession to curb it.
- The economy has not experienced a recession, raising questions about macroeconomic models.
Public Perception vs. Economic Reality
- Despite positive economic indicators, public opinion polls show record-high negative views of the economy.
- This disconnect between perception and reality raises questions about the factors influencing public sentiment.