Now that we have the "official" blessing from the National Bureau of Economic Research (NBER), I guess we can actually start using the word recession, right?
Bloomberg, "Recession started in December 2007, NBER says":
"The U.S. economy entered a recession a year ago this month, the panel that dates American business expansions said today.
The declaration was made by the cycle-dating committee of the National Bureau of Economic Research, a private, nonprofit group of economists based in Cambridge, Massachusetts. The last time the U.S. was in a recession was from March through November 2001, according to NBER.
“The committee determined that the decline in economic activity in 2008 met the standard for a recession,” the group said in a statement on its Web site. The 1.2 million drop in payroll employment so far this year was the biggest factor in determining that start of the contraction, the group said.
Federal Reserve policy makers at their last meeting predicted the economy will contract through the middle of 2009, in line with private economists’ forecasts. If correct, the recession would be the longest since the Great Depression."
Thanks for telling us, guys. We honestly had no idea...
Despite early warnings from many private economists and noted market participants, it seems some people were hoping reality would continue to be ignored, if we could only keep from uttering the dreaded "r-word" in public.
Oh, and you might want to take the NBER's official durations of previous recessions with a grain of salt, as well.
For example: the early 1990s recession. I was in junior high at the time, and not really much of an economic observer, but I seem to remember the economic downturn as lasting well beyond the NBER's July 1990-March 1991 timeframe.
Here's a little trip down memory lane to the early '90s:
US job losses were affecting much of the white collar and blue collar workforce, many American households were facing financial problems, the rise of Nirvana and the "Seattle sound"/grunge coincided with the country's dark mood and its youth culture's angst from 1991-1993, SNL was still lampooning George Bush and the recession well into the latter part of his presidential term, and Ross Perot made the nation's economic problems the focus of his independent presidential campaign in 1992.
This time around (2007-2008), we had frequent denials and pooh-poohing of the dreaded "recession" label by many of the country's officials and the media's talking heads and high priests of spin. We can probably expect another spike in recession-related articles and media stories, now that the economic reality of the past twelve months has been officially recognized.
So, I guess this leaves us with one question. Where are you getting your information from on topics such as these?
Do you trust the tv and cable news to tell you that the sun is shining or that the clouds are covering the sky? Internet, blogs, newspapers? A mixture of some or all of these media sources? Maybe you trust your native common sense, and take these proclamations and news stories for what they are worth (not much, if anything).
At any rate, especially during times like this, I find it interesting to know what people are really thinking, and where they choose to get their information from. Tell us what you know, share your thoughts with us here.
Related articles and posts:
1. "US faces recession, Bernanke's stimulus" - Finance Trends.
2. "Congratulations, it's officially a recession" - Big Picture.
3. "Recession began a year ago, economists say" - MarketWatch.
4. "Recession in real terms" - Finance Trends.
5. "Marc Faber on Bloomberg TV" - Finance Trends.
6. "Roubini: US in recession" - Finance Trends.