Everyone's screaming for recession like it's some guaranteed trade setup. Reality check: we'd need WAY higher energy prices to actually push this economy over the edge.
The sensitivity to energy shocks isn't what it was in the 70s or even 2008. The economy has structurally changed — less energy-intensive GDP mix, better efficiency, more services vs manufacturing weight.
So all these permabear calls banking on oil spikes to trigger the crash? They're fighting the last war. Energy would need to go parabolic AND stay there to matter enough. Short-term spikes get absorbed now.
Be careful what you wish for. Recession trades work until they don't — and macro regime shifts take longer than your options expiry.
The sensitivity to energy shocks isn't what it was in the 70s or even 2008. The economy has structurally changed — less energy-intensive GDP mix, better efficiency, more services vs manufacturing weight.
So all these permabear calls banking on oil spikes to trigger the crash? They're fighting the last war. Energy would need to go parabolic AND stay there to matter enough. Short-term spikes get absorbed now.
Be careful what you wish for. Recession trades work until they don't — and macro regime shifts take longer than your options expiry.