Are we due for a recession? One barometer is to simply look at how much we’re all chattering about the possibility of a recession. This is normally calculated using media mentions of the word recession, but that’s old school—and I don’t know where to get that data anyway. So instead, here are two other measures of how much we’re all talking about the economy:
The orange line is an index based on the average daily number of uses of the word recession in the Wall Street Journal. The blue line is the Google Trends chart for recession as a percentage of the Google Trends chart for expansion. It crossed the 50 percent mark two weeks ago.
As you can see, there’s been a slight upward trend in both indexes all year, followed by a huge uptick in December. The Journal index increased by 50 percent in December compared to its average over the previous 11 months, while the Google Trends index soared by 150 percent.
Why is this? Is it because we all get bored during the holiday season and invent things to chatter about? Is it because the stock market has been doing so poorly? Is it because Donald Trump has been whining about the Fed so much? Or is it because we really are getting close to a downturn? Wait and see!