Hi! We've got 3 charts for you to whip out when the conversation at dinner tonight turns to the economy, climate change or e-commerce. Anything else and you're on your own.
The US economy is in a recession. At least it is if you ask some economists.
Agree to disagree
The country notched its second consecutive quarter of negative GDP growth, with US output contracting at an annualized rate of 0.9% last quarter. For most economists that meets the definition of a recession, but technically in the US a recession isn't official until a group at the National Bureau of Economic Research actually say "yep, this is a recession".
Exactly what data the NBER considers beyond GDP isn't clear — it appears to be more of an art than a hard science. Soaring inflation will surely count for the "it's probably a recession" argument, while near-record-low unemployment will go in the "maybe it's not" column.
GDP going backwards is a definitive sign that things are slowing up — and another three-quarters-of-a-percent rate hike, which was announced this week by the Federal Reserve, is unlikely to help GDP growth get back into the green.
Whether it is a technical recession or not, the third option in this debate is to get philosophical and quote Bobby Kennedy — who famously said that GDP "does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials... it measures everything in short, except that which makes life worthwhile".
This week the Biden administration — in between discussing the technical definition of a recession — unveiled a new plan to get lower-income households hooked up to solar power.
Here comes the sun
The plan is to expand access to "community solar" projects, where many households can share the benefits from one larger set of solar panels. After a solar farm is built, residents can then subscribe to get credit back on their electricity bills — the idea being that this subsidy will encourage solar uptake for those households that might not be able to afford the tens of thousands of upfront costs associated with installing solar.
Data from the EIA shows how quickly solar power electricity generation has grown in the US. In the last 5 years electricity generated by solar power has more than tripled, to around 115 billion kilowatthours.
That's quick progress, but it still only leaves solar as 14% of the total share of renewables electricity, and even less (roughly 3%) of all electricity generated. There's a long way to go.
The e-commerce boom is over. At the peak of the pandemic, as we all bought exercise equipment to ignore and houseplants to neglect, the e-commerce industry was one of the major beneficiaries. But online shopping is yet another pandemic trend that seems to be unwinding — the official data shows that the share of retail dollars that are spent online has fallen again in early 2022, sending online retail sales back towards the pre-pandemic trajectory.
Abandon cart
One company that is painfully aware of the change in habits is Shopify. The tech company, which provides online stores with tools and software to run their business, reported another set of underwhelming results this week with CEO Tobi Lutke sharing that 1,000 employees would be let go — cutting the company's workforce by some 10%. Shopify has seen its market cap. fall almost 80% in the last year, wiping out some $160bn of value.
Misery loves company
Although one of the worst affected, Shopify isn't alone in its misery. Yesterday, amidst what was actually a better-than-expected quarter, Amazon declared another 4% annual decline in online sales — the second time in a row that the e-commerce giant has seen its online sales slip.
• Americans have spent more than $300m on lottery tickets in the past 2 days, as the lottery rollover draws people in (chart here).
• AI image-generator Dall-E has explored what data viz from famous artists like Picasso, Rothko and Basquiat might have looked like.
• Meta announced a 1% drop in revenue in its latest quarter — the first ever decline for the social media company.
• Trade the future. Inflation, gas prices, Biden's approval rating, entertainment, weather, travel — you name it, there’s a market for it on Kalshi where you can trade the outcomes of world events on a fully CFTC-regulated exchange.**
• Australians could be in for an unholy amount of guacamole as the nation’s farmers are currently producing22 avocados per-person.• Do vending machines really kill more people every year than sharks?
• New Zealand’s name could be down to a national vote after 70,000 people signed a petition to adopt the Māori name Aotearoa.
**This is sponsored content.
