The Economy Is Turning Over. Will Bitcoin Follow?
Are we in a technical recession? Does that even matter? Economic cycles have been turning over and bitcoin has historically followed.
In today’s issue we’re highlighting some of the latest data on the U.S. Gross Domestic Product recession debate and economic cycles turning over. A more in-depth view of macroeconomic trends and how they impact bitcoin will be the highlight for our July monthly report released to premium subscribers next Monday, August 1, and free subscribers later in the month.
If you haven’t read it yet, check out our most recent monthly report: “Contagion”, for the month of June.
The U.S. Recession Debate
Whether the United States is technically in a recession or not, does it matter? We highlighted in a previous piece, U.S. Recession Territory And FTX Accumulation, that a recession is here but the definition is nuanced as deemed by the National Bureau of Economic Research (NBER).
Highlighted by Eric Basmajian of EPB Macro Research, major components of determining a recession include industrial production, nonfarm payrolls, real personal consumption and real income. The main takeaway is that all of this data is decelerating sharply and if it isn’t a “recession” today then it’s likely one rather soon.
Downward revisions to GDP growth in the U.S. and globally relative to high consensus expectations has been a theme we’ve highlighted multiple times this year. U.S. GDP growth has been consistently below the long-term average of 3% average since 2007 and is well below its 2.4% five-year moving average trend this year. We’re likely headed into a period of much lower global growth and even the New York Federal Reserve Bank forecasts don’t have GDP growth returning to 2% by 2025.
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