“Lady Gaga’s chart-topping hits have got us dancing, but her recent resurgence on the economic radar has us questioning the beat of the economy. The ‘Lady Gaga recession indicator’ has been making waves online, with the pop sensation’s comeback seemingly tied to a potential downturn. But what’s behind this unlikely correlation, and can a pop star’s success really signal the upcoming economic crash? As the Australian economy teeters on the edge, we’re putting the spotlight on this unlikely recession indicator and exploring the theories behind its supposed connection to economic woes. Join us as we dissect the myth and reality behind the ‘Lady Gaga recession indicator’ in our latest investigation.”
The Recession Indicator Meme: Separating Fact from Fiction
According to Morningpicker, signs of a recession are looming everywhere. Lady Gaga headlining Coachella is a recession indicator. A new White Chicks movie? Recession Indicator. Knee-high Converse? Unfortunately, yes. The meme, which jokingly points to returning cultural trends as harbingers of a market crash, has inundated feeds across the globe. As far as economic metrics go, it’s the most trending. But is 2000s cringe a true indicator of our financial outlook? And what does it say about us that we’re all in on the joke?
Understanding the Meme’s Origins
The meme’s roots can be traced to a 2019 tweet, which asked, “When did everything become a ‘recession indicator'”, poking fun at several news publications decrying what they believed were signs of a looming US recession. From there, the phenomenon got a shout-out in satirical news outlet The Onion, and has sporadically popped up again over the last three years.
Nothing could compare, however, to its popularity within the past months — when everything from US Army enlistments to Snooki at the club indicated economic downturns. Even celebrity Ed Sheeran and Spotify are in on the joke. It was propelled mostly by major US economic headlines.
In early April, President Donald Trump announced “reciprocal” tariffs on almost all trading partners, which he later diminished to a “baseline” 10 per cent rate. He also ratcheted up the pressure on Beijing, slapping a 145 per cent tariff on Chinese goods. The result? Everything from toys to toasters now faces a price increase for US consumers, while American Gross Domestic Product (GDP) decreased at an annualised rate of 0.3 per cent.
What Does the Meme Really Mean?
To answer that, RMIT professor of finance Angel Zhong says the meme needs to be distinguished from actual recession indicators. Those include things like employment data and levels of industrial production. She says this meme instead reflects “the uncertainty, the sentiment and the confidence of consumers”.
While she adds that anxiety is “totally reasonable” given the current outlook for the US market, there have been positive signs in the Australian market, including an adjustment in interest rates.
“I can acknowledge that the past few years have been hard for a lot of Australians, with interest rate hikes and the cost-of-living crisis,” Dr Zhong says. “But let’s also acknowledge the fact that we have seen some decrease in interest rates already.”
Her take is backed up by the PM, who was asked the same question before the election. “We have, if you look at all of the figures, inflation heading the right way, interest rates heading the right way, it started to rise before the election,” Anthony Albanese told reporters in late April.
Culture and Economics: A Divided History
Culture and consumers have a long history of foretelling a recession. There’s the lipstick index — a theory coined by cosmetic giant Estée Lauder that lipstick sales rise when we’re nearing a recession (the idea being consumers opt for a relatively inexpensive pick-me-up as opposed to a larger splurge). Then there’s the hemline index, which posits that when the economy goes up, so too do hemlines.
Dr Zhong even points out the infamous avocado smash — the debunked theory that avocado sales signal a recession. These examples show how consumers react to economic uncertainty, and the meme is just another example of that.
The Australian Market: A Different Story
In contrast to the United States, Australia’s market is telling a different tale. Interest rate adjustments have had a significant impact on the market, and the effects are being felt.
- The decrease in interest rates have brought benefits to the market, with a positive effect on inflation and consumer spending.
- However, there is a time lag between interest rate changes and inflation, which means that the effects of interest rate deductions are not immediately felt.
Culture and Economics: A Divided History
The relationship between culture and consumers has a long and complex history, with cultural trends often foretelling a recession.
The Lipstick Index and the Hemline Index
The lipstick index, coined by Estée Lauder, suggests that lipstick sales rise when a recession is nearing, as consumers opt for a relatively inexpensive pick-me-up.
The hemline index, on the other hand, posits that when the economy goes up, so too do hemlines.
The Infamous Avocado Smash
RMIT professor of finance Angel Zhong points out the infamous avocado smash, which has been debunked as a reliable recession indicator.
Despite this, cultural indicators can still have an impact on the market, reflecting the uncertainty, sentiment, and confidence of consumers.
Conclusion
In conclusion, the notion that Lady Gaga’s rise is a harbinger of economic doom has been a topic of fascination and amusement for many. Through a closer examination of the so-called “recession indicator meme,” we’ve found that while the correlation between Gaga’s popularity and economic downturns is intriguing, it’s largely a product of chance and selection bias. Furthermore, the meme’s significance extends beyond mere entertainment value, as it speaks to our collective desire for patterns and meaning in an increasingly complex and unpredictable economic landscape. As we move forward, it’s essential to approach economic indicators with a critical and nuanced perspective, recognizing that the interplay between culture, economics, and technology is multifaceted and ever-evolving.
The Lady Gaga recession indicator meme serves as a poignant reminder that our attempts to make sense of the economy can sometimes lead us down rabbit holes of spurious correlations. However, it’s precisely this type of creative and outside-the-box thinking that can also lead to innovative solutions and fresh perspectives. As we continue to grapple with the challenges of the modern economy, we would do well to balance our pursuit of predictive models and economic certainties with a healthy dose of skepticism, humor, and openness to the unexpected.