It is official: We are in a recession… or are we?
The National Bureau of Economic Research (or NBER for short) has come out and officially declared that the United States economy is in a recession. Well isn’t that timely news? And here the citizens thought the economy was in great shape. But are we in a recession?
Let’s go back in time, and review some of the calls made by the NBER.
On November 26th, 2001 the NBER came out and said that the US Economy was in recession. In fact, the November report said that the recession has actually been ongoing since March of that year, 8 months before the report. But going back to a Reuters article detailing the recent recessions, by the time the NBER announced that we were in a recession, the recession was already over. In fact, the NBER did not officially announce the recession was over until its July 17th, 2003 report, confirming that it in fact ended back in November of 2001.
The recession prior to that started all the way back in July of 1990. Once again, hot on the case, the NBER released the official notice that the US Economy was in recession in their report in April of 1991. It is a shame that that recession actually ended in MARCH of 1991, a month before the official announcement. But that is ok, because they came back and said the recession was over December 22, 1992
Finding the details of their expeditious reporting is not hard. It is located right there on their own site.
Announcement dates:
The December 2007 peak was announced December 1, 2008.
The November 2001 trough was announced July 17, 2003.
The March 2001 peak was announced November 26, 2001.
The March 1991 trough was announced December 22, 1992.
The July 1990 peak was announced April 25, 1991.
The November 1982 trough was announced July 8, 1983.
The July 1981 peak was announced January 6, 1982.
The July 1980 trough was announced July 8, 1981.
The January 1980 peak was announced June 3, 1980.
So… are we still in a recession? History has shown that by the time the NBER has officially announced the recession, that we are already out of it, or at least damn close. Brandon has already said that he thinks the recession/depression actually ended in November. For me, the NBER coming out and officially announcing recession actually makes me feel much more confident that we are through the worst of it all and will be bouncing back very soon.
Sorry to say Newman but this time is quite a bit different. The deleveraging taking place currently and that will continue to occur for the next 6-12 months will keep us in a continued recession.
Where I live the bad numbers such as forclosures, job layoffs, etc. continue to rise.
I like the idea of being positive but look where it’s gotten us.
As long as the economy contracts and there’s job cuts and reduced industrial activity, we are on a recession. If you look at the definition of recession you will see that it really is a period of reduced economic activity. Forget about technicalities, like 2 consecutive quarters of GDP contraction, as far as we are concerned, we are still in the middle of “it”.
The issue with the economy is the media.The fact is, If they wasnt on T.V every 30 minutes telling us how bad things are most people wouldnt even notice it. I know thats not true for the ones losing a job or having issues in housing or something like that but for the average every day person they have no clue. The media proceeds to tell us how dire and bleak everything is and then the average person stops spending. Once that happens things stops. Im not really sure that we are out of the woods as far as this recession goes but generally by the time people notice it we are on the back side of it. Hopefully it wont last 6 more months but its hard to say at this point.
What does any of this have to do with Satellite Radio? Sirius XM was not even mentioned in the article. This site is turning into economicbuzz and this post has no business being on this site.
NBER can roll out all the fancy “statistics” they like, I think we were officially in a recession right about when people started wearing clothes made from their pets’ shed fur.
I do think the media is making this issue much larger than it is, or it could be that I live in such a low socioeconomic demographic area that we just don’t notice. Prices have gone up a far as food and other commodities, but those who received public assistance are supplemented with more food stamps or more financial aide for dependents. The only way the economy has really affected me is that my house is on he market, and it is not selling. As in the past, we just have to ride this out. This is not the first time our country has been in recession and it will not be the last. Oh, you can’t blame it on the president either. These financial plunders are deeper than the government and perhaps outside of their control.
GetItStraight:
I tend to agree with you. I think we are still contracting. I have made several predictions in the forums and other places, stating that I think that this is going to turn around in March. I think we have a couple rough months ahead, perhaps not with contraction, but maybe stagnation. Around March, I think we may start to see actual growth again.
Mike The Rookie:
You are definately proving your handle to be correct. The economy has EVERYTHING to do with Sirius. If you cannot see that, I don’t know if you even deserve a rookie title…
Thank Newman.
im wondering what those words taste like? here it is april and its still as bad as it was in december, if not worse. With us feeling positive effects on this bailout stimulus, its still goona be quite some time till things are back to normal. I wouldnt exhale till it was 2010.
Duh!:
You know, the banks are reporting better than expected results already this month, car sales for the month of march improved, home sales have improved…
Read the last line of the article again: ” For me, the NBER coming out and officially announcing recession actually makes me feel much more confident that we are through the worst of it all and will be bouncing back very soon.”
Lets see, December to March would be 3-4 months… Does that qualify as “bouncing back very soon”? It does in my books. I did not say completely healed and booming economy. I said bouncing back. I know we are not going to have great numbers at any point during 2009, but they will be better than they were last year.