Morning Brief – Is the US already in recession?

Humphrey Percy
Chairman and Founder
Mon 13 Mar 2023

Is the US already in recession?

Due to the mixed messages from recent economic releases on the state of the US economy with for example record low unemployment while at the same time there is increasing data on lay offs especially in the tech sector, it is worth asking the question: Is the US already in recession? A recession is defined as a significant decline in economic activity spread across the economy that lasts a few months. On that basis with the US economy having expanded 2.7% in Q4 2022, the US is technically not in recession. However a recent poll conducted by the National Bureau of Economic Research in the US is less positive: 30 out of 48 economists polled believe that the USA is heading to and will be in recession by the end of 2023.

EUR/USD 1.0630.

Hong Kong Property

The most expensive property market in the world is Hong Kong and it is primarily driven by demand-average prices for a unit start at USD 1 million. However a short term solution to the seemingly intractable problem of solving the housing shortage may lie in the news that Hong Kong’s LockDown has been lifted. Hong Kong built 8 special purpose quarantine camps and only 3 were used. The largest quarantine camp is on Penney’s Island next door to where Disneyland is. In total there are 40,000 individual units each of 200 square feet with individual bathrooms built in. Not spacious by any means but perfectly serviceable, those quarantine units could be deployed as short term housing.

US Air Quality

The list of the Top Ten places in the USA with the worst air quality was published over the weekend and while most listings were not a surprise given the concentrations of heavy industry in Indiana, Texas and Pennsylvania, the top three places were more of a surprise: the top two were in South Los. Angela’s and Bakersfield, California famed for its strict policies on all things green and in third place the South and West areas of Chicago known as the Windy City which should one would have thought, keep the air fresh.

Saudi Aramco

News yesterday that Saudi Aramco had made a profit of USD 161 Billion in 2022. To put that in perspective US giant ExxonMobil made USD 56 Billion and the UK’s Shell managed USD 39 Billion in the same financial period. The Saudi Aramco profit was driven by a firm oil price, shortages in significant parts of the year and the ongoing sanctions against Iran in place since 2018 and against Russia in place since 2022. Of the Saudi Aramco profit, 95% will go to the Saudi Arabian government owners of the vast majority of the company.

Eight Days a Week

It was this day in 1965 that the Beatles notched up their 7th Number 1 Hit in the USA with this song. This was the first time that the fade in was used to open a song and was played by George Harrison on his Rickenbacker 12 string.

Ooh, I need your love, babe
Guess you know it’s true
Hope you need my love, babe
Just like I need you

Hold me, love me
Hold me, love me
I ain’t got nothin’ but love, babe
Eight days a week

Love you every day, girl
Always on my mind
One thing I can say, girl
Love you all the time

Hold me, love me
Hold me, love me
I ain’t got nothin’ but love, girl
Eight days a week

Eight days a week
I love you
Eight days a week
Is not enough to show I care

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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