Forget recessions and vibecessions, we're in the middle of a confused-as-hell-cession
- Elon Musk is confused as hell by the economy. It's relatable.
- It feels like a recession is coming, but the details are hard to understand for the average person.
"I don't know what the hell is going on," is a great Elon Musk quote no matter what provoked it.
In this case, he was talking about the economy. During a call discussing Tesla's recent earnings, he said: "One day, it seems like the world economy is falling apart, next day, it's fine. I don't know what the hell is going on."
And, honestly, who does? Not ordinary people and not even economists, who seem to keep contradicting each other.
The first sign that we might be quite confused came last summer, when we heard that although it might feel like you're in a recession, you're actually in a vibecession — it feels like an economic downturn, but the hard numbers say it's all in your mind.
One reason we think the US economy is worse than it really is might be that inflation is growing faster than our salaries are, so the amount of disposable income we have could well be less than it was a few years ago.
But it may also be because people do keep saying a recession is coming and it's quite complicated to understand why if you're not fluent in economist.
For example, most people might not know what "the inversion between the 2-year and 10-year Treasury yields hit a record 103.5 basis points" means exactly, but they will get that it's a recession indicator that "just flashed its loudest warning ever." Even if you've never heard of New York Life Investments, you probably assume they know a bit about the economy, so when they say a recession is "barreling toward" it, you'll be worried.
Except... now really smart-sounding people like Neil Dutta, who's the head of economics at Renaissance Macro Research, which analyzes the economy day in, day out, are saying the whole thing was overblown and we're nowhere near a recession after all.
But wait! We're all working fewer hours, and that apparently could cause a recession?! Also, something "very strange" about interest rates too. No wonder we're all spending less time doing our jobs, we're too exhausted from trying to figure this all out.
It's a confused-as-hell-cession, and Elon Musk has never been more relatable.