Metrics of real economic growth are plummeting, and are about to drop through the “line in the sand” indicating recession.
Wise decisions, prudent adaptation and real progress all require facing reality: yes, the channel you can’t change. While the global economy melts like an ice cream cone in mid-July Death Valley, the official murmurings reassure us the U.S. is in “slow but steady growth, not recession.”
Courtesy of longtime contributor B.C., here is a chart that combines key metrics of real growth into one line and plots it against real GDP (gross domestic product).GDP is the blue line, and the black line depicts gross private investment + wages less debt service/M2 less the monetary base.
OK, that’s a mouthful, but what it combines are key measures of economic activity: private investment, net earnings minus debt service, i.e. what the household has to spend, and the money supply (M2) minus the monetary base.