As I write this, I sigh and realise that despite the president of the United States dropping his threats to commit war crimes and destroy Iranian civilisation, he is always a chance to set the world on fire because it’s been more than 20 minutes since he had a Diet Coke.

This, of course, is hyperbolic. I think.

Economies are rather tough enough to predict without having to deal with the erratic actions of a man whose cerebrum is indistinguishable from a particularly rancid Chicken McNugget.

So take all of that into consideration.

The past week has seen an increase in concerns of a recession in the coming months. Various media outlets are polling economists and getting them to place odds.

At this point I am required to cite the old joke that economists have predicted 30 of the past five recessions. But on this I can at least stand aside from my peers.

I don’t mean to brag, but I am a bit of a savant at such things. After all, I was the bloke who in early February 2020 wrote an article titled “Bushfires and the coronavirus will hit Australia’s economy – but they won’t knock it out”.

So when I say we won’t have a recession, you can give that all the credibility it deserves.

The main reason for the recession concerns is Trump and Iran, and a thing from the 1970s called “stagflation”, where inflation rises while the economy stagnates and unemployment also rises.

As a general rule, when unemployment goes up inflation usually slows, but in the mid-1970s and in early 1980s this did not happen:

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The reason, of course, was the Opec oil crisis and the Iranian revolution oil crisis, which is why the current war in Iran has created such jitters.

But Trump’s Taco manoeuvre on Wednesday has lessened the concerns – at least for now. Oil markets reacted quickly and prices fell 13% in an hour:

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But it is worth noting that it wasn’t just oil price rises in the 1970s and 1980s that led to stagflation and recession, it was also the reaction of governments and the Reserve Bank (which at the time was not independent).

In the nine months from November 1980 to July 1981, the official interest rate rose from 9.8% to 15.4%. A recession followed and the rate kept going up, hitting a record 20.8% in August 1982:

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Similarly, the 1990s recession occurred only after rate rises peaked in November 1989 at 18.2%.

This is why the concerns about Iran and oil prices have in some ways sharpened worries of a recession. After all, three weeks ago the governor of the Reserve Bank was asked whether she’d be prepared to put Australia into recession – if that’s what it takes to bring inflation down – and she replied, “We don’t want to have a recession, but if it’s hard to get inflation down, then you know we’re going to have to deal with that possibly.”

That is not altogether comforting.

Inflation will still be higher than previously anticipated, as the impact of the oil shock flows through, and as companies take advantage of the situation to raise prices similar to what occurred in 2022 off the back of the Russian invasion of Ukraine.

The market still thinks the RBA will raise interest rates in May:

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Even after Trump’s backdown, it still anticipates another rise by December:

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One would hope that, should the economy slow and unemployment begin to rise, the RBA would stop raising rates. But given the tendency of the central bank to only realise it has gone too far after it has actually done so, that is no guarantee.

The good news is we are nowhere near a recession at the moment.

Forget the discussion of two consecutive quarters of negative GDP, the real measure of a recession is if unemployment rises by more than 0.5 percentage points in a year. The US economist Claudia Sahm found this was a much better way of measuring recession because it is quicker than waiting for GDP figures, and it also focusses on people rather than production.

On this score, we’re doing OK:

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It’s also worth reminding ourselves what we mean when we talk about a recession. The Covid recession was not really a recession; it was an arbitrary one forced on us by efforts to prevent deaths, and once the lockdowns ended, things snapped back.

In a real recession the drop in employment lingers for many years, even up to a decade:

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This is why I get a bit snarky when I hear the governor of the RBA being so blithe about causing a recession should inflation remain above 3% for longer than she would like.

Recessions destroy lives.

The story of male full-time employment since 1970 is essentially one of collapse during recession, never to recover:

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And maybe the RBA thinks it can tweak the levers so easily that the recession would this time only be a small one, but I’d rather not risk it.

Thankfully Trump has walked back from his latest threat, but that does not mean the RBA will stop doing all it can to reduce inflation – even if, as it says, that means a recession.

Let us hope they are not true to their word.

• Greg Jericho is a Guardian columnist and chief economist at the Australia Institute