what is Vibecession

**The concept of vibecession highlights a significant disconnect between the economic indicators and the public's perception of the economy.** This phenomenon is particularly relevant in the context of the United States, where the term was coined to describe the period starting in 2022, despite relatively strong economic data, including low unemployment and rising real wages.

1. **Definition and Origins**:
- Vibecession is a term that combines "vibe" and "recession" to describe a situation where the public's attitude towards the economy is pessimistic, despite favorable economic conditions. It was coined by economic commentator Kyla Scanlon in June 2022 to capture the feeling of living through a recession despite stable economic indicators.
- The term gained prominence in 2022 and 2023, often used by the mainstream media to describe the economic climate, highlighting a growing disconnect between economic data and public sentiment.
2. **Characteristics and Causes**:
- **Inflation and Economic Inequality**: High inflation, energy prices, and rising costs of essentials like housing, healthcare, and groceries contribute to this feeling of financial unease. Despite stable income, the higher cost of living can lead to financial strain.
- **Stagnant Wages and Job Insecurity**: Wage growth often lags behind inflation, reducing purchasing power. Additionally, the prevalence of gig work and contract jobs without benefits adds to job insecurity, fostering a sense of instability.
- **Media Influence**: The media's portrayal of economic issues, often emphasizing negativity and pessimism, plays a role in setting a negative tone, contributing to the vibecession.
3. **Implications and Consequences**:
- **Reduced Consumer Confidence**: Vibecession can lead to reduced consumer spending, delayed investment, and real market consequences, as seen in the reduced consumer confidence that has been trending upward since 2022 but hasn't yet returned to pre-pandemic levels.
- **Self-Fulfilling Prophecy**: The vibecession can become a self-fulfilling prophecy, where negative economic sentiment can influence economic outcomes, potentially leading to a recession if sustained.
4. **Bridging the Gap**:
- To address the vibecession, it is crucial to understand the factors driving the disconnect between economic data and public perception. This includes addressing inflation, ensuring wage growth keeps pace with inflation, and promoting economic policies that benefit all income levels.

In conclusion, vibecession represents a complex interplay between economic indicators, public sentiment, and the media's influence. It underscores the importance of considering the emotional and social dimensions of economics alongside traditional economic metrics.