Recession Ended June 2009

[Paulie]

No harm, no foul. We do need better words. 1-2% GDP growth oughtta be a recession not a correction.

The recession IS the correction.

The correction is price levels retreating to equilibrium and stagnating growth, which is what makes it eventually become a recession.

You misunderstood what I was saying.

While 1-2% GDP growth technically isn't a recession, in a world that requires 150,000 new jobs/month and 3% GDP growth to retain status, 0% GDP growth really isn't the magic threshold between a shrinking and a growing economy.

The magic threshold is somewhere close to 3% /anum GDP growth depending on fed interest rates and other variables.

When the money supply is not growing at x%/anum then you are in a true recessionary climate. Again a much more important threshold than 0% GDP growth.

0% GDP growth is arbitrary when discussing the true inertia of the economy.

I took it like you said it. You said the small growth rate ought to be a recession, not a correction, which by logic is a distinction where there is no distinction to be made.

You're also trying to define your own version of recession, which is of no use to this particular OP because it's completely beside the point.

 

[william the wie]

Out of all the threads and columns I've seen today on this story this is the most economically literate one. Just posting so I can track the argument.

 

[loosecannon]

You're also trying to define your own version of recession, which is of no use to this particular OP because it's completely beside the point.

What I said I am doing is what I am doing. Which isn't usefull to the OP, but it is what it is. The definition of a recession isn't as magic as it ought to be. That's all.

 

[loosecannon]

How can you measure economic growth on a static scale like pure GDP when GDP doesn't care if it's products are war, medical care, useless financial sector synthetics, or soilent green?

Because all it measures is output and income. It doesn't measure societal mores.

OK, but the economy is a social function. If GDP grows and unemployment surges there maybe no benefit due to the increase in GDP while there may be huge hardship due to unemployment.

GDP is overrated. IMO the only reason why the economy is measured in terms of GDP growth is because that bears a direct impact on the futures of banking and interest rates. That's just my opinion and not an effort to be argumentative. But economic "science" as a rule is all skewed to address the issues most significant to bankers and financiers. Not people or nations.

 

[uscitizen]

There are things that cause the GDP to go up and hurt the heck out of the people. High oil prices for instance.
Boosted GDP but hurt the vast majority of US citizens.

 

[Charles_Main]

Pretty funny that it ended before much of the stimulus had been spent if you ask me.

 

[uscitizen]

Umm aren't those lagging jobs supposed to be happening about now? I mean the recession ended over a year ago.

 

[Charles_Main]

Umm aren't those lagging jobs supposed to be happening about now? I mean the recession ended over a year ago.

One would sure hope so

 

[uscitizen]

Ohh well I was lucky enough to live in "The golden Age of America".
All downhill from here.

I speak from consideration of peoples standards of living.

 

[Paulie]

Umm aren't those lagging jobs supposed to be happening about now? I mean the recession ended over a year ago.

There's much more uncertainty about fiscal and regulatory policy in the near future than there typically is following a recession.

Companies have a pretty good reason to be timid about hiring right now.

 

[uscitizen]

I guess we are back into the just another 6 months loop.

 

[Neubarth]

According the official daters of the business cycle, the NBER, the recession ended in June 2009.

The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday by conference call. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months.

Business Cycle Dating Committee, National Bureau of Economic Research

That doesn't mean the economy is great, or has recovered to where it was before the recession, or that we aren't going to slip into another recession. It just means that the recession technically ended last summer.

Toto, you can post these lies all you want. As previously stated, the government can buy false GDP numbers as they have done, but it does not put people back to work.

Instead, to hide the ever increasing Unemployment they just drop people off of their imaginary Labor Force.. They substantiate this with false surveys. It goes on and on and on and on, but there is no real improvement in the economy.

It is time to impeach Obama. He is incompetent and horribly dishonest.

 

[Paulie]

I guess we are back into the just another 6 months loop.

A lot is going to depend on the election.

If the repubs take enough seats to gridlock the dems' agenda, or even take enough seats to move back to the right a little, businesses might feel a little more secure that they aren't going to get taxed and regulated as bad and may hire.

That's just a guess though. Business and the markets do well when the party control between the executive and legislative branches is split.

 

[loosecannon]

So how did they cook GDP data, Neubarth?

 

[Neubarth]

Pretty funny that it ended before much of the stimulus had been spent if you ask me.

Charlie, the reason why it "ended" was because the stimulus money is designed to create positive GDP. Government spending can instantly make GDP positive as it did. They then continue to keep it positive with further government spending. Yet the reality is that people are not back to work and the employment situation continues to be dysmal. I have been telling people about this ruse for years.

 

[Neubarth]

So how did they cook GDP data, Neubarth?

I have been over this many times. This time I will just say that people should look for their selves. The constituent parts of GDP tabulate spending. Government spending qualifies and can take negative GDP and make it positive in a quarter with just a few billions spend in the right places. Go get the definition of GDP and you will see for yourself.

 

[loosecannon]

So they didn't cook the GDP data?

 

[Charles_Main]

Umm aren't those lagging jobs supposed to be happening about now? I mean the recession ended over a year ago.

There's much more uncertainty about fiscal and regulatory policy in the near future than there typically is following a recession.

Companies have a pretty good reason to be timid about hiring right now.

Which of course according to the left, is not Obama's fault

 

[Charles_Main]

Pretty funny that it ended before much of the stimulus had been spent if you ask me.

Charlie, the reason why it "ended" was because the stimulus money is designed to create positive GDP. Government spending can instantly make GDP positive as it did. They then continue to keep it positive with further government spending. Yet the reality is that people are not back to work and the employment situation continues to be dysmal. I have been telling people about this ruse for years.

So basically, we were right when we said their idea of Stimulus would not actually stimulate the economy. That is was purely a cosmetic feel good attempt to make it appear things are better in the short term, and would simply lead to even worse problems down the road.

Can't say I am happy to have been right on this one.

 

[PLYMCO_PILGRIM]

The GDP is the entire economy.

that isn't what he meant. He meant that the economy has other aspects other than GDP. Like unemployment and wages and tax revenues and debt etc.

ok

Ty Loosecannon for clarifying and thank you for toro for adding more information for people.