Kyla Scanlon: What's Actually Wrong With the Economy?

Economist and author Kyla Scanlon discusses inflation, economic narratives, and the housing market.

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Kyla Scanlon: What's Actually Wrong With the Economy?

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How's the economy actually doing?

In 2022, economists forecasted that we'd be in a recession by now. Did it ever actually happen, though? Prices got higher, interest rates ticked up, but mass layoffs never really happened and gross domestic product growth chugged on. People mostly weathered the turbulence.

Joining us today to talk about all that and to speculate on what effects former President Donald Trump and Vice President Kamala Harris' proposals might have on the economy is Kyla Scanlon. She worked as a macroeconomic analyst at Capital Group before founding Bread, a financial education company. She has built a large social media following by teaching finance and economics via YouTube, Instagram, Substack, and TikTok. She recently published her first book In This Economy: How Money and Markets Really Work.

As we came out of the pandemic, we experienced inflation beyond what most millennials have seen in their lifetimes. The Federal Reserve hiked interest rates to attempt to achieve a soft landing—using the power of the central bank to cool a hot economy without causing a recession. We start by asking Kyla: "We're in an election year. How do you think voters should perceive the current state of our economy?"

Sources referenced in the conversation:

1. Financial Times: 2022 prediction of a recession.
2. Real Gross Domestic Product (GDPC1) | FRED | St. Louis Fed
3. COVID did not rescue the Armageddonists from underperformance purgatory
4. Just Asking Questions with Nate Silver
5. University of Michigan: Consumer Sentiment (UMCSENT) | FRED| St. Louis Fed
6. 12-month percentage change, Consumer Price Index
7. FiveThirtyEight: Which Economic Indicators Best Predict Presidential Elections?
8. Kyla Scanlon: Why We Have a Housing Crisis
9. Homeownership rates among Gen Z, Millennials, and Gen X.
10. Harris-Walz economic agenda press release
11. Harris press release about her "$25k downpayment assistance" plan
12. Kyla Scanlon: The TikTok Girl is Right: Modernity and the 9-to-5

• Producer: John Osterhoudt

Comments

[Sandra (formerly OBL)]

If your priority is making billionaires richer, the Biden economy is fantastic.

#LibertariansForBiden

[Longtobefree]

"What's Actually Wrong With the Economy?"

Politicians; in particular, democrats.

[Stupid Government Tricks]

Your Q: What’s Actually Wrong With the Economy?

My A: Government meddling.

My Q: How do you fill the rest of the 1:15:00 episode?

Your A: …

[Dillinger]

[insert several inappropriate suggestions for killing of time]

[Rick James]

but mass layoffs never really happened and gross domestic product growth chugged on. People mostly weathered the turbulence.

I don’t have any stats handy but the tech sector has gone through some pretty massive layoffs, and that’s in an environment where tech sector layoffs were literally unheard of since the crash of 2000.

(Oh, I do have some stats, nvm)

Companies with the biggest workforce reductions in 2023
Amazon [16,080 roles]
Alphabet [12,000 roles]
Microsoft [11,158 roles]
Meta [10,000 roles]

And that’s just a small number. My own company laid off workforce just this year.

And then there’s all the shuttered storefronts in major cities like San Francisco, LA, Seattle, New York etc.

If you sent me back in time to the 1990s in downtown Seattle and told me that in 2024 there would be homeless tents everywhere and the Mayor was trying to pass legislation to fill shuttered storefronts and then in the next breath told me, “Hey, but the economy is just fine”… I’m not sure what my reaction would be but it wouldn’t be a head nod.

[Dillinger]

Intel dumped fifteen thousand last week. cite? no, mike lol.

[damikesc]

The video game industry overall is going through a rather substantial reduction in employment.

[aldousd666]

even if you add up all across the tech sector, with the major focus being on the silicon valley big guns, the number of layoffs was something like 250,000 total heads. That may sound like big numbers to you, but as we see that's within the margin of error on the monthly government jobs numbers.

[Sarah Palin's Buttplug - Jan 6 = 9/11 (same motive)]

Yes , GDP and employment numbers are excellent but modern economists like to measure how people FEEL about the economy instead of using big-city statistics.

So the media keeps telling folks their Cheesy Poofs cost more. Therefore people are ANGRY.

[Sandra (formerly OBL)]

2022 was Wall Street's worst year since 2008.

You spent all of 2022 using that same idiotic Cheesy Poofs line.

How humiliating is it to totally shred your credibility in defense of a brain-damaged failure of a President ...... only to see that President bullied into retirement by his own party?

[JasonT20]

How about 2023 and 2024 so far? That article says that the S&P 500 closed 2022 at almost 20% down from the beginning of the year (3,839.50 at end of trading on 12/30/22, 4,778.14 at beginning of trading on 1/3/22). But it is around 45% higher than it was on 12/30/22. So does Biden get credit for that?

How about the growth of wages over inflation?

The data shows that is the case. The Consumer Price Index climbed about 21.7% between the four quarters of 2019 and the four quarters ending in the second quarter of 2024.

But over that same period, median weekly earnings, which include before-tax wages plus any commissions or tips, climbed 24%, for a gain of 2.3% beyond the inflation rate, the Treasury analysis found.

It is likely difficult to say how much of the lower consumer confidence is due to economic reality and how much is due to one party (and its media allies) constantly telling their audience that things are bad.

[Sevo, 5-30-24, embarrassment]

^ This is the slimy piece of shit proposing murder as a preventative for, well, he isn't quite sure:

JasonT20
February.6.2022 at 6:02 pm
“How many officers were there to stop Ashlee Babbitt and the dozens of people behind her from getting into the legislative chamber to do who knows what?...”

FOAD, asshole.

[Sandra (formerly OBL)]

"How about 2023 and 2024 so far?"

The point is that Buttplug ruined his credibility with that relentless pro-Biden gaslighting campaign throughout 2022. If a Democrat is in the White House, he's going to say the economy is great. If not, he's going to say it's terrible.

"It is likely difficult to say how much of the lower consumer confidence is due to economic reality and how much is due to one party (and its media allies) constantly telling their audience that things are bad."

Nice try, but that's another discredited Buttplug talking point. You can't blame dissatisfaction with Bidenomics on right-wing media brainwashing. Even many Democrats are honest enough to admit disapproval.

Late 2023: Only 24% of Democrats say they are better off financially under Biden, poll says

In short, Biden sucks. He deserves his low approval. Bidenomics is unpopular across the political spectrum. And far from being the victim of a hostile media, if anything the media *protected* him ("He's mentally sharper than ever!") - until he bombed a debate so badly, they realized they might not be able to drag him over the finish line.

[Mother's Lament]

“If a Democrat is in the White House, he’s going to say the economy is great. If not, he’s going to say it’s terrible.”

Well now, that just what JasonT20 was planning to do. You just saved him the embarrassment of wearing the same insane ideological dress as Buttplug in public.

[JasonT20]

If a Democrat Whoever is in the White House, he’s going to say the economy is great. If [he] is not, he’s going to say it’s terrible.

Fixed it for you.

[Sandra (formerly OBL)]

Ahhhhhhhh, there's your problem. You're defending Buttplug while displaying total ignorance of his modus operandi.

Still, the fact that he tells outrageous lies in his username should have been a red flag.

[JasonT20]

I don't see where I was defending anyone. I was just suggesting that more data might give a more complete picture of the economy over time as compared to picking just one year and one measure (stock market).

[DesigNate]

I see you’re not familiar with shrike’s posting history.

[Fire up the Woodchippers! (5-30 Banana Republic Day)]

The economy IS terrible under Biden. It WAS good under Trump. That’s backed up by objective facts, and subjective points of view by the public at large.

[damikesc]

Remember...he HATES Biden.

[Bertram Guilfoyle]

Did you retire Well Adjusted Biden Guy, or is he just on hiatus?

[Rick James]

There's a request to support to change the user name to Well Adjusted Harris Guy.

[Dillinger]

>>Well Adjusted Harris Guy

cannot exist in nature. fact.

[Sevo, 5-30-24, embarrassment]

turd, the ass-clown of the commentariat, lies; it’s all he ever does. turd is a kiddie diddler, and a pathological liar, entirely too stupid to remember which lies he posted even minutes ago, and also too stupid to understand we all know he’s a liar.
If anything he posts isn’t a lie, it’s totally accidental.
turd lies; it’s what he does. turd is a lying pile of lefty shit.

[Super Scary]

So you're going with the "vibecession" play. Booooring.

[DesigNate]

It’s amazing what spending 7 trillion dollars can do to pump up GDP, you dishonest fuck.

People know the economy is shit because even the government admitted to 800k plus jobs that were never created.

#TotallyNotADemShill

[Uncle Jay]

"What's Actually Wrong With the Economy?"

Wel...let's see.
Inflation.
Needless taxes.
Expensive, useless and unnecessary bureaucracies.
Wasting money on foreign aid, subsidies, NGO's and grants.
Government workers embezzling millions if not billions of dollars.
Morons in Congress spending our money like there's no tomorrow.
Government employees who are over-paid, under-worked and drawing a shitload of money and benefits at our expense.
Social programs that haven't worked for decades.
The list goes on, but I'm sure all you wonderful people out there get my idea.

[Stupid Government Tricks]

A strange thread running through that list. What could it be ....

Oh yeah, Stupid Government Tricks.

[Spiritus Mundi]

“In 2022, economists forecasted that we’d be in a recession by now. Did it ever actually happen, though? Prices got higher, interest rates ticked up, but mass layoffs never really happened and gross domestic product growth chugged on.”

Except Q1 and Q2 2022. Those two consecutive quaters chugged down. That used to be called something…..if I could only remember what.

[Roberta]

Banana?

[Brandybuck]

If you check, we're not really doing all that great. We don't need a confirmed and notarized recession for the economy to be in the doldrums.

One needs a broader perspective on the economy than a 1930s playbook. It's like how we didn't get much inflation with quantitive spending, despite every Misesian who ever lived saying it was utterly certain and predictable (despite Mises being wholly against predictions). The problme with their theory is that it didn't take into affect actual bank practices. Because even though reserves bloated, banks were not lending. It's almost like Mises said, supply and demand apply to money too!

So same thing now. We have inflation not because of printing presses, but because of massive increases in actual government spending. So the old cartoon printing press theory about boom and bust doesn't exactly match the reality on the ground. Just reading the numbers off the meter doesn't give you the picture.

[Stupid Government Tricks]

Pardon me?

We have inflation not because of printing presses, but because of massive increases in actual government spending.

The government can only spend what it collects or prints or borrows, and when it borrows from itself, that's printing.

[Sevo, 5-30-24, embarrassment]

Brandyshit =/= above room-temp IQ.

[Roberta]

The government doesn't borrow from itself. It does borrow indirectly from the Federal Reserve. That's probably what you're thinking of.

However. what Brandybuck is pointing out is that cash showing up on the Fed's books and therefore in subsidiary banks doesn't necessarily circulate in comparable amounts.

Not only that, but the quantity of cash demanded can vary a lot depending on both desire to borrow and desire to spend. The velocity of money in the economy was depressed a lot by the pandemic.

[Sevo, 5-30-24, embarrassment]

Your apologia for brandyshit is noted and also accepted as irrelevant; brandyshit is a L-party partisan, incapable of choosing what or who might really help.
You are not a lot of improvement on the TDS-addles shit-pile.

[LIBtranslator]

The Fed is also a weapon. The Chinese Opium War panic of 1837, the 1893 income tax and smuggling Panic, the 1903 silent panic were much the same. China's 1905 boycott pressured Republicans into disguising prohibition as pure food, but the economy crashed just the same. The 1909-1912 dope fanaticism resulted in actual war and the Harrison act made the Fed a necessity absent in 1837, 1907 and 1912. Even so, Wilson's use of the income tax shut down all stock markets for a long time.

[Truthfulness]

https://yourlogicalfallacyis.com/tu-quoque

[Overt]

This is the problem with all these economic metrics. There was tons of inflation going on in the financial-apocalypse. It just inflated the corporate bond and securities markets. This myth that there was no inflation is a smokescreen of liberal economists.

In 2007 everyone agrees we were in a housing bubble. And housing prices crashed. Those median housing prices were back to THE SAME LEVELS within 6 yrstds. Are you really going to tell me that our economy and productivity grew SO MUCH in 6 years that houses were tangibly worth what we all agreed were bubble prices? Please.

If you look at the legacy of QE, it did to the bond and securities markets what general goods inflation does to our labor- made them worth less. Bonds became a horrible investment- stable but still losing money. Securities inflated massively to the point that Blue Chips and other "bedrock securities" could no longer be counted on to provide alpha (a return that exceeded the general economy). And so prices of speculative stock were inflated massively as they were the only place to get a return. That is why Rivian was able to generate 10 Billion dollars in cash reserves before they even had a proof of concept.

During recessions, not every industry retracts- some grow and some thrive. Prior to QE, we had a MASSIVE devaluation of housing and stocks. And QE re-inflated those goods. This notion that there was no inflation going on is a fairy tale.

[mad.casual]

Kyla Scanlon: What's Actually Wrong With the Economy?

Not enough 2-for-1 sales on shoes and handbags, amiright?

[Eeyore]

One word.
Starts with G.
Rhymes with mint.
GO!

[VULGAR MADMAN]

Gimp?

[Fire up the Woodchippers! (5-30 Banana Republic Day)]

You mean Jeffy?

https://www.reddit.com/r/barstoolsports/comments/ei8t5d/big_ev_looking_like_a_snack_in_his_nye_outfit/

[Vernon Depner]

Gestimmint?

[Truthfulness]

Kyla Scanlon has been nothing but a gaslighter when it comes to the economy. She is completely out of touch with reality.

[Fast Eddie]

Including this article, everyone keeps using the term "cooling" as if now lower inflation rates are okay and we can move forward. Sometimes I think we really are in the twilight zone.

[squarooticus]

Is a 26 year old social media influencer really the best you guys can do for guests? Someone who doesn't understand how competitive the grocery market is and was mealy-mouthed about price controls when it's clear that she understands (from the canteloupe example) why they don't work is not going to be very insightful for listeners.

[LIBtranslator]

Leave it to Lizard and Zach to pretend 9 out of 10 Crashes and depressions were NOT due to Republican asset-forfeiture prohibition laws.

[Truthfulness]

They weren't.