Still reading tea leaves to predict a recession? But why when we’ve advanced so much: nowadays you know a recession is coming when the Philadelphia baseball team wins the World Series competition. Welcome to the 21st century, mate!
Does it work?
Heck, yeah. Much better than some of the scientifically-flavored indicators!
In 1929 the Philadelphia Athletics win the championship. To commemorate their victory, the stock market drops like a stone, inventing phrases such as Black Thursday, Black Monday and Black Tuesday. Then, the Great Depression runs its course, plunging the US and wide parts of the world into economic misery for a decade.
For a while, Philadelphia basketball stays out of the economy. Then 1980 happens and the Phillys win the World Series for the first time. The US economy immediately blips into recession the same year, takes a breather, and then goes in for the kill in 1981 to 1982.
The Phillys won the World Series a second time. Can you guess when? I’ll give you a hint: It was a great victory. Absolutely great. Get it? That’s right, they won in 2008. At the news, Lehman Brothers immediately collapses, the financial markets explode into turmoil, and we end up with the Great Recession. For the following decade we experience the marvel of quantitative easing, negative interest rates, and low growth—and look where that’s brought us.
What does it all mean? (Do we have to boycott the Phillys?!one!)
It means that a very, very bored person stared at a screen long enough until the pixels danced and they danced and had a really good time and then they formed numbers. In a world full of data, if you try hard enough, you can find a pattern in anything.
What news outlet would even publish this garbage?
I give you the Wall Street Journal, Market Insider, the Philadelphia Inquirer, and of course the acclaimed Yahoo News. Google for more.
It’s easy to underestimate how much guilty superstition can be hidden behind the fig leave of sarcasm and a disclaimer of “correlation isn’t causation”. And of course, a good headline plays with that and here you are.