The other craziest thing is that the Bank of England isn't just saying "We'll have a recession" but they're specifically selling it as the longest recession ever.

If you ever want to have the longest recession ever a great first step is for your central bank to say "Hey - this one is going to be a lot worse than most of them". One of the responsibilities of central banks (which the Fed has taken quite seriously) is to carefully control messaging - if you're overly optimistic when things are clearly bad you'll cause a loss of faith and it'll make things worse... but there's also never a reason to go above and beyond expectations in how bad you think things will be because that causes people to batten down even more hatches and prolong the recession.

Markets are weird and they're essentially gigantic tabloids - the image of what's going on counts much more than tangible things like a shortage of widgets.