As U.S.expansion notches record, recovery may have only just begun

davfor

This article discusses why the Fed is making it a high priority to try to keep the expansion going (despite the substantial risks that entails)....

A now record-setting run of U.S. economic growth enters its 121st month on Monday, sustained by a decade of low interest rates and massive Federal Reserve intervention that helped put 22 million people back to work. But the real economic recovery may only be in its infancy... periods when GDP exceeds potential are typically when workers enjoy the greatest wage gains and members of historically sidelined communities find jobs. In recent years, those periods have not lasted long, a fact that Fed and other officials are wrestling with as they weigh possible interest rate cuts and assess just where the U.S. economy now stands....For the type of progress Fed and elected officials feel is needed to rebuild middle-class incomes, it may take several more years...

https://reuters.com/article/us-usa-economy-record/as-u-s-expansion-notches-record-recovery-may-have-only-just-begun-idUSKCN1TW1H7

davfor

“The benefits of this long recovery are now reaching these communities to a degree that has not been felt for many years,” Federal Reserve Chairman Jerome Powell said last week. “Many people who in the past struggled to stay in the workforce are now getting an opportunity to add new and better chapters to their life stories. All of this underscores how important it is to sustain this expansion.”

https://reuters.com/article/us-usa-economy-expansion-contrasts/rich-get-richer-everyone-else-not-so-much-in-record-u-s-expansion-idUSKCN1TX0HE

catch22

Thanks @davfor
Still lots of "things" continuing to change since the market melt.
The below quote is from the beginning intro voice line used from the tv series "The Naked City" (NYC location). For whatever reason, this phrase has stuck in mind for decades. The phrase covers a lot of ground in society, IMHO. Naked City Wiki link

"There are eight million stories in the naked city. This has been one of them."

I think about this phrase, in particular; when seeing the numerous stories when the market will crash, or whether I should be buying gold, etc. You get my drift.

Your linked article reminds me of the "a million stories". Many folks since the market melt will never have their lives be the same again; for millions of reasons.

A personal note about this and economic changes on a small scale for some locations.
In 2015, I had conversations with those I knew in the building trades; several of whom I hadn't spoken with for several years prior. Several of the skilled interior folks (cabinet makers, trim work) had found work at Home Depot and Lowe's in related work. One in particular, who is very anal about quality work was able to maintain his own business (although a multi-year lowdown) because of his high standards and overall knowledge of all phases of home construction. He rightfully survived from word of mouth from clientele.
Moving along to 2018 and building trades folks. A neighbor's home burned enough in Jan. 2018 that it had to be demolished. The full rebuild took 18 months....finished last week. I asked about this time frame and part of this is the result of a lack of skilled workers for certain aspects of home construction. A lot of start and stop, waiting upon available people to do the work.
So, the market melt effects are still in place for some economic areas.
Take care,
Catch

Old_Joe

@Catch22- This is indeed the story here in the SF Bay Area: contractors are damn near coming to physical blows over "stealing" skilled (and even some not so skilled) workers.

This situation was existing prior to the massive devastating fires in the Santa Rosa and Paradise areas. Now, in those areas, even if funding is available from insurance settlements, the time frame for starting to rebuild is quoted in years, not months. Exacerbating this is the fact that the best of the skilled crafts and trades have been sucked from those outlying areas into the San Francisco commercial building frenzy, because of the significant wage differential.

This is leaving mostly only the so-so contractors in the fire areas, so not only is there a huge delay, but the quality of what is available is "iffy".

I remember a rather unpleasant MFO poster some years ago who continuously maintained that everything that happens to someone in life is due to their own abilities and actions- luck has no part in it. Sure thing.

davfor

We purchased a small winter home in the Lemon Bay area of Florida shortly after Hurricane Charley devastated Punta Gorda a few miles down the road in 2004. It was 2 to 3 years before Punta Gorda was almost back to normal. Scarcity of qualified contractors and a dramatic spike in costs dramatically slowed down the rebuilding process.

We currently live full time in a small town in NW Oregon. The building boom and house price increases here in recent years reminds me of the late 1970's. Affordability is becoming a problem for much of the local population much as it did back then. The Volker Shock and a related timber employment crash turned the 1970's boom into a depression around here in the early 1980's. Hopefully that will not be the outcome here this time around.

The current Fed does not appear to be satisfied with letting trickle down economics provide the "appropriate" amount of benefit to low to moderate income households. And no infrastructure bill appears to be in the offing. So, it appears the Fed is willing to use the blunt instruments they have available in an attempt to prolong the expansion and thereby trickle some benefits down to those households. Its a role I do not recall them taking on before. Hopefully, they are up to the challenge.

johnN

Thx..