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Slow
02-06-2009, 03:16 AM
Tough times all around

"Canada could lose 325,000 jobs this year and the national unemployment rate could soar to nearly 9%, the Toronto-Dominion Bank predicted yesterday in one of the most dire forecasts on Canada's worsening labour market.

Canada has already shed 84,000 jobs in the last two months of 2008 as the recession took hold for the first time, but the bank's economists say the picture will worsen as the economy enters a new and more perilous period.

The 325,000 jobs that will be lost this year would likely be the most since the recession of the early 1990s."

http://www.edmontonsun.com/Business/2009/02/05/8270206-sun.html

Hans
02-06-2009, 08:05 AM
And yours is the most since 1982. We win!

Huggy85
02-06-2009, 08:14 AM
http://globalpolitician.com/25439-economics

ECONOMY: Unemployment Headed for 9 Percent

Today, the Labor Department will report employment data for January. In December, the economy lost 524,000 jobs, and the consensus forecast is for another 535,000 jobs lost in January. My forecast is for a 520,000 loss.

Unemployment should reach 7.4 or 7.5 percent and is headed for 9 percent before the end of 2009.

Since President Bush took office, more adults have chosen not to seek employment owing to worsening labor market conditions. If labor force participation today were at the same level as when President Bush took the helm, the unemployment rate would be about 9.4 percent. The difference is discouraged workers that have quit looking for work that the Labor Department does not count when computing the unemployment rate. Add workers in part time positions that cannot find full time employment and the hidden unemployment rate is about 14.5 percent.

Anapeg
02-06-2009, 09:55 AM
I do believe I heard the newscaster say 11% in Windsor is Canada's highest at present. I am confident we will eclipse this mark with ease.

verotik66
02-06-2009, 10:20 AM
you may be slow but you still got us beat

Michigan Unemployment Rate
(Seasonally Adjusted)

December 2008 10.6%
Change Over Month +1.0
Change Over Year +3.2

Michigan unemployment rate tops 10 percent, expected to keep rising
by Rick Haglund | Detroit Bureau
Wednesday January 21, 2009, 5:59 PM

DETROIT -- Michigan's unemployment rate has hit double digits for the first time in nearly a quarter century.

The state's 10.6 percent unemployment rate in December was the steepest since December 1984 when 10.9 percent of the state's work force couldn't find jobs, the state Department of Energy, Labor and Economic Growth said Wednesday.
RELATED STORIES

• Granholm promises 276 more workers, upgraded Web service to handle backlog of Michigan unemployment requests

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Put another way, slightly more than one out of 10 people in the state's labor force was out of work last month.

The U.S. unemployment rate last month was 7.2 percent.

Michigan last experienced double-digit joblessness in September 1985 when the unemployment rate hit 10 percent. The state was then emerging from the worst economic downturn since the Great Depression.

Unemployment last month jumped a staggering 3.2 percentage points from the 7.4 percent rate in December 2007. And December's rate was up a percentage point from November.

"That was a little surprising," said Scott Watkins, a senior consultant at the East Lansing-based Anderson Economic Group. "Unfortunately, I don't think we've found the bottom yet."

The biggest area of job losses last month was business and professional services, which shed 15,000 jobs. About 9,000 of those lost jobs were temporary and contract positions, many of them in the beleaguered auto industry.

Manufacturers eliminated 12,000 jobs in December. The only industry category that did not shed jobs last month was natural resources and mining, which was flat.

Economists expect the state and national unemployment rates to rise this year because consumers are spending less in a deepening recession.

"There are still some more layoffs to come," said University of Michigan economist Don Grimes. "Retail jobs are going to take a huge hit going forward."

Michigan lost 173,000 jobs in 2008, when unemployment averaged 8.4 percent.

U-M economists George Fulton and Joan Crary have predicted this year's average jobless rate will jump to 10.3 percent.

Mackinac Center senior economist David Littmann said he expects unemployment to hit 12 percent by July.

Slow
02-06-2009, 11:27 AM
Of course Michigan's unemployment rate is high, we have a Canadian democrat as our leader :)

Oh, and by the way, comparing a State to a country means I win. :)

Slow
02-06-2009, 11:38 AM
And yours is the most since 1982. We win!

"Canada shed a much worse than expected 129,000 jobs in January, sending unemployment up 0.6 percent to 7.2 percent, Statistics Canada said Friday.

The jobs loss was worse than the grimmest monthly showings of the downturns of the 1980s and 1990s, Statistics Canada said in a statement.

And the January drop in employment topped by far the 40,000 job losses analysts had forecast. They predicted unemployment would edge up to 6.8 percent from 6.6 percent in December."

http://www.breitbart.com/article.php?id=CNG.8f107734a55d32d8490aae2b6b8e517 2.5c1&show_article=1

It's amazing, what some people consider a 'victory' ;)

Slow
02-06-2009, 02:11 PM
"Canada shed a much worse than expected 129,000 jobs in January"

That would be 1.2 million jobs in the U.S.

Yet barely a word on here.

Unreal.

Huggy85
02-06-2009, 07:17 PM
"Canada shed a much worse than expected 129,000 jobs in January"

That would be 1.2 million jobs in the U.S.

Yet barely a word on here.

Unreal.

Still waiting for your serious comment on the fact that it was the United States sub prime mortgage crisis that has caused the rest of the world to go into recession.

Your usual remark is something like "it's great to be king". That's like the guy that burned down the house being joyful for setting up a nice bonfire and weenie roast.

http://rawstory.com/news/2007/UN_US_economy_could_cause_global_0110.html

According to an analysis released by the UN's Department of Economic and Social Affairs, "There is a clear and present danger of the world economy coming to a near standstill. ... The domino effect of a U.S. recession would be to knock down export growth from China, Europe and Japan, in turn reducing their demand for exports from developing countries."

Chief UN economist Rob Vos told Bloomberg News that in those circumstances the world economy might not expand at all in 2009.

Australian television reports that although their own economy remains strong, banks and home buyers there are feeling the impact of the global credit crunch. The major Australian banks have been downplaying their exposure to the US subprime mortgage crisis but they are said to have a $1 billion investment in Countrywide Financial, which is rumored to be close to collapse. This has already caused them to raise mortgage interest rates.

Slow
02-06-2009, 07:28 PM
"Still waiting for your serious comment on the fact that it was the United States sub prime mortgage crisis that has caused the rest of the world to go into recession.

Your usual remark is something like "it's great to be king". That's like the guy that burned down the house being joyful for setting up a nice bonfire and weenie roast."

Well, it is good to be King, that I will not deny.

However, the sub prime crisis is only a part of the worldwide recession. This thing is much too large to simply pin on one thing (I realize your inherent anti-Americanism does not allow you to see differing factors).

Huggy85
02-06-2009, 07:32 PM
"Still waiting for your serious comment on the fact that it was the United States sub prime mortgage crisis that has caused the rest of the world to go into recession.

Your usual remark is something like "it's great to be king". That's like the guy that burned down the house being joyful for setting up a nice bonfire and weenie roast."

Well, it is good to be King, that I will not deny.

However, the sub prime crisis is only a part of the worldwide recession. This thing is much too large to simply pin on one thing (I realize your inherent anti-Americanism does not allow you to see differing factors).

I hope you are enjoying your weenie roast. Don't forget that when just before your recession started in 2007 (not the week before Christmas 2008 like you have claimed) your unemployment rate was 2% lower than Canada's. I'd say the US has fallen much further than Canada has since then.

Slow
02-06-2009, 07:33 PM
I hope you are enjoying your weenie roast. Don't forget that when just before your recession started in 2007 (not the week before Christmas 2008 like you have claimed) your unemployment rate was 2% lower than Canada's. I'd say the US has fallen much further than Canada has since then.

Right. You lose more jobs per capita and that means you're doing better than the U.S.

My comment about blind anti-Americanism seems quite appropriate right now.

Huggy85
02-06-2009, 08:02 PM
Right. You lose more jobs per capita

How do you figure that? Your math sucks.

Since your recession started, USA has lost 3.1 million jobs.

http://network.nationalpost.com/np/blogs/posted/archive/2009/02/06/news-roundup-canada-u-s-combine-for-730-000-jobs-lost-in-january.aspx

"Employers in the United States have shed jobs every month since January 2008, for an aggregate decline in payroll employment of 3.1 million."

3.1 million divided by your population of 303 million means that 1% of Americans have lost jobs.


Since Canada's recession started, 213,000 jobs have been lost. 213,000 divided by Canada's population of 33 million means that .65% of Canadians have lost jobs.

http://*******logic.wordpress.com/2009/02/06/record-body-count/

"Since October, when most economists say the global recession hit Canada’s shores, the country has lost a whopping 213,000 jobs, wiping out a year’s gains."

1% vs. .65% doesn't fit your equation

Pity the American education system.........

1337
02-06-2009, 08:28 PM
Unfortunately, Slow is the United States Educational System.

Slow
02-06-2009, 08:44 PM
It's just too damn cute, watching you guys when you think you're on to something!

I mean CUTE! :)

I was talking about that specific number mentioned above.

Nice try, though :)

Slow
02-06-2009, 08:45 PM
Unfortunately, Slow is the United States Educational System.

So, has the recession affected fast food restaurants yet?

Huggy85
02-06-2009, 08:52 PM
I was talking about that specific number mentioned above.

Nice try, though :)

I see. So just like you seem to feel that any US recession prior to December doesn't count, the only unemployment numbers that count are the ones from January?

Sheeeeeesh!!!!

Seems to me the thread topic refers to the big picture. But right now it seems convenient for you to just want to talk about one month.

Slow
02-06-2009, 08:55 PM
I see. So just like you seem to feel that any US recession prior to December doesn't count, the only unemployment numbers that count are the ones from January?

Sheeeeeesh!!!!

Seems to me the thread topic refers to the big picture. But right now it seems convenient for you to just want to talk about one month.

That number I posted dealt with one month, yes.

Good boy!!

Who gets a treat?
WHO GETS A TREAT??

(pats head)

Huggy85
02-06-2009, 09:00 PM
That number I posted dealt with one month, yes.

Good boy!!

Who gets a treat?
WHO GETS A TREAT??

(pats head)

Sounds like an admission of defeat as to who's economy is suffering the most (excepting that one month, of course).

White flag accepted

Slow
02-06-2009, 09:02 PM
I'm glad you guys are using my 'white flag' line. It shows how effective it really is. Also, the fact you're imitating me proves you look up to me as someone to be emulated.

The fact the 'white flag' line doesn't fit here is irrelevant.

KDawg
02-06-2009, 09:04 PM
Right. You lose more jobs per capita and that means you're doing better than the U.S.

My comment about blind anti-Americanism seems quite appropriate right now.

I'd say blind adherence to propaganda is a hey of a lot worse. Do you seriously believe the depression started only 2 months ago?

Huggy85
02-06-2009, 09:06 PM
I'm glad you guys are using my 'white flag' line. It shows how effective it really is. Also, the fact you're imitating me proves you look up to me as someone to be emulated.

The fact the 'white flag' line doesn't fit here is irrelevant.

There is only one thing about this thread that is irrelevant, and it is also not to swift.

Slow
02-06-2009, 09:08 PM
I'd say blind adherence to propaganda is a hey of a lot worse. Do you seriously believe the recession started only 2 months ago?

I'm sure you know all about blind propaganda ;)

But I digress.

The recession officially began two months ago. The reasons for the recession were evident long before.

This orange I'm eating, they say it's seedless.

Oh yeah?? Two bites in, a SEED!!!

Damnit!!!!

Slow
02-06-2009, 09:09 PM
There is only one thing about this thread that is irrelevant, and it is also not to swift.

Not too swift...not too swift...as in not fast...opposite of fast...who is that? Who does he mean??

bohd
02-07-2009, 08:15 AM
i am sure we look at you , but in order to be civil , i do NOT think it is in admiration that is on our minds,,,,,

Huggy85
02-07-2009, 12:43 PM
The recession officially began two months ago. The reasons for the recession were evident long before.




According to the "Michigan Bank of Slow" I guess.

Others feel very differently....

http://money.cnn.com/2008/12/01/news/economy/recession/?postversion=2008120115

NEW YORK (CNNMoney.com) -- The National Bureau of Economic Research said Monday that the U.S. has been in a recession since December 2007, making official what most Americans have already believed about the state of the economy .

The NBER is a private group of leading economists charged with dating the start and end of economic downturns. It typically takes a long time after the start of a recession to declare its start because of the need to look at final readings of various economic measures.

The NBER said that the deterioration in the labor market throughout 2008 was one key reason why it decided to state that the recession began last year.

Employers have trimmed payrolls by 1.2 million jobs in the first 10 months of this year. On Friday, economists are predicting the government will report a loss of another 325,000 jobs for November.

The NBER also looks at real personal income, industrial production as well as wholesale and retail sales. All those measures reached a peak between November 2007 and June 2008, the NBER said.

In addition, the NBER also considers the gross domestic product, which is the reading most typically associated with a recession in the general public.

Many people erroneously believe that a recession is defined by two consecutive quarters of economic activity declining. That has yet to take place during this recession.

Slow
02-07-2009, 12:44 PM
The NBER said that the deterioration in the labor market throughout 2008 was one key reason why it decided to state that the recession began last year.


Yup, that was two months ago! :)

How 'bout I get you a calendar for your birthday??

Huggy85
02-07-2009, 12:50 PM
Yup, that was two months ago! :)

How 'bout I get you a calendar for your birthday??

Please explain how the fact that this article was printed 2 months ago changes the facts.

It really just proves how totally uninformed you are; when the rest of the US has acknowledged two months ago that the recession is a year old, yet you still today claim it just started after this article was printed.

Slow
02-07-2009, 12:51 PM
when the rest of the US has acknowledged two months ago that the recession is a year old,.


The "rest of the U.S."??

Source? Link??

Huggy85
02-07-2009, 12:54 PM
The "rest of the U.S."??

Source? Link??

How about this one...

http://money.cnn.com/2008/12/01/news/economy/recession/?postversion=2008120115

Oh, that looks familiar, doesn't it?

"It's official: Recession since Dec. '07
The National Bureau of Economic Research declares what most Americans already knew: the downturn has been going on for some time."

Slow
02-07-2009, 12:55 PM
No, you need to prove "the rest of the U.S." (your words) believes that way.

In other words, you have to find sources that say everyone but me believe that way.

If you cannot, you've, once again, shown you do not have any reservations about lying, if it helps you score some cheap political point.

Good luck! :)

Huggy85
02-07-2009, 01:12 PM
How about producing a "link, source?" that supports your assertion that the recession started 2 months ago.

If you're going to make a statement like that, one would hope that you'd be able to back it up with SOMETHING!

Slow
02-07-2009, 01:18 PM
How about producing a "link, source?" that supports your assertion that the recession started 2 months ago.

If you're going to make a statement like that, one would hope that you'd be able to back it up with SOMETHING!

Can't do it, EH??

We'll just chalk this up to yet another time you got caught in a lie.

The Berean
02-07-2009, 01:49 PM
Can't do it, EH??

We'll just chalk this up to yet another time you got caught in a lie.


right, the lie tactic

from the least honest guy here.

slow that be you in case theres any confusion

Slow
02-07-2009, 02:19 PM
right, the lie tactic

from the least honest guy here.

slow that be you in case theres any confusion

I bet you say that to all the guys ;)

Huggy85
02-07-2009, 03:48 PM
Can't do it, EH??

We'll just chalk this up to yet another time you got caught in a lie.

What in the Hal are you talking about?

I gave you a link supporting the statement that most Americans believe the recession started long ago. It is YOU that can't offer up a link that supports your claim that the recession started just 2 months ago.

What a joke!

Slow
02-07-2009, 06:44 PM
I gave you a link supporting the statement that most Americans believe the recession started long ago.



Yet you said all other Americans, but me, believed the recessions started long ago.

You made a statement. You stalled hoping no one would call you on your obvious lie. You hoped no one would ask for proof.

Sad.

Sad, indeed.

Huggy85
02-07-2009, 07:23 PM
Yet you said all other Americans, but me, believed the recessions started long ago.

You made a statement. You stalled hoping no one would call you on your obvious lie. You hoped no one would ask for proof.

Sad.

Sad, indeed.

Yeah. I'm busted. Said all. Meant most. You must have a few friends that think just like you do.

I'm still waiting for you to back up your ridiculous claim that the recession started 2 months ago. Of course everyone knows you can't do that. So I'm calling you on what is either an obvious lie or a mere statement of ignorance. Still waiting....

Slow
02-08-2009, 12:26 AM
I understand your anger..yet I still consider you a friend.

That's how I roll. :)

Huggy85
02-08-2009, 09:22 AM
I understand your anger..yet I still consider you a friend.

That's how I roll. :)

Still nothing to back up your claim, huh?

BlueSky
02-08-2009, 09:36 AM
What is the definition of a recession? Haul it out, and apply the definition. Settled.

Huggy85
02-08-2009, 10:03 AM
What is the definition of a recession? Haul it out, and apply the definition. Settled.

What is the definition of recession that you subscribe to then, bluesky?

Huggy85
02-08-2009, 10:17 AM
What is the definition of a recession? Haul it out, and apply the definition. Settled.

Besides, that was done very effectively here.

http://money.cnn.com/2008/12/01/news/economy/recession/?postversion=2008120115

Yet slow continues to insist that the recession started in Dec. 2008. As usual though, he hasn't been able to produce anything to back up this ridiculous assertion.

BlueSky
02-08-2009, 10:34 AM
From that article the nub of the controversy lies here:

The NBER also looks at real personal income, industrial production as well as wholesale and retail sales. All those measures reached a peak between November 2007 and June 2008, the NBER said.
In addition, the NBER also considers the gross domestic product, which is the reading most typically associated with a recession in the general public.

Many people erroneously believe that a recession is defined by two consecutive quarters of economic activity declining. That has yet to take place during this recession.

My comment: Who is to say this is erroneous?
This has always been the popular definition, I think.

But the discussion is rather moot at this pt.

So it all depends on whose definition one is using. It's like asking a man who is falling off a 40 story blding whether he is at the 38th floor or the 30th.

Huggy85
02-08-2009, 10:48 AM
Many people erroneously believe that a recession is defined by two consecutive quarters of economic activity declining. That has yet to take place during this recession.



Sorry, but that definition has no validity and is not based on any economic theory


http://www.telegraph.co.uk/finance/financetopics/recession/3917367/Definition-of-a-recession-drawn-up-on-back-of-an-envelope.html

"The technical definition of a recession was drawn up on the back of an envelope and was a piece of political spin, a former ambassador to the US has claimed."

"Peter Jay, who was Britain's envoy to Washington between 1977 and 1979, said that the definition - two consecutive quarters of negative growth - had no basis in economic theory and was created by the US Government in 1967 to aid the re-election prospects of President Lyndon Johnson.

Mr Jay, who said he was "in the room" when the definition was established, said that Art Okun, the chairman of Johnson's economic council, acted upon "indications that there might be a recession that year", which he feared would dent the President's popularity.

He said: "Art had the neat idea that if we had a definition of recession which meant that people could say we are not actually in a recession, not technically, that would get the president out of a difficulty.

"So on the back of an envelope he invented the idea that in order to call it a recession you had to have had two consecutive quarters of negative growth."


"Mr Jay, who went on to become the BBC's economics editor, said: "This was completely arbitrary - there was absolutely nothing scientific or in the economic theory that requires that a recession be defined in that way. It was just a neat device by a clever economist trying to help his chief who was faced with a political challenge. "

Slow
02-08-2009, 10:54 AM
Why make this so hard? None of us or economists, so it's best to go by this simple rule of thumb: a recession is two consecutive months of negative growth.

The U.S. did not hit that benchmark until late-Fall.

Speaking of the old saying "rule of thumb", do you know where it comes from?

Puritan courts allowed a man to beat his wife, but he could not use a stick any wider than his thumb. Using a stick wider than the thumb constituted 'abuse'.

BlueSky
02-08-2009, 11:09 AM
It's the definition that I hear from Canadian newscasters all the time.

Huggy85
02-08-2009, 11:10 AM
Why make this so hard? None of us or economists, so it's best to go by this simple rule of thumb: a recession is two consecutive months of negative growth.



Might work for you seeing as how you need simple rules of thumb. The real world is not that simple though. A real definition is required.

http://www.nber.org/dec2008.html

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.

Huggy85
02-08-2009, 11:11 AM
It's the definition that I hear from Canadian newscasters all the time.

The one that was created to help a president get elected?

Slow
02-08-2009, 11:12 AM
Might work for you seeing as how you need simple rules of thumb. The real world is not that simple though. A real definition is required.

http://www.nber.org/dec2008.html

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.

LOL!

Thanks for saying what I said, but with one hundred more words.

Huggy85
02-08-2009, 11:17 AM
LOL!

Thanks for saying what I said, but with one hundred more words.

Not what you're saying at all.

From the same article......

The Business Cycle Dating Committee of the National Bureau of Economic Research met by conference call on Friday, November 28. The committee maintains a chronology of the beginning and ending dates (months and quarters) of U.S. recessions. The committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months.

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.

Because a recession is a broad contraction of the economy, not confined to one sector, the committee emphasizes economy-wide measures of economic activity. The committee believes that domestic production and employment are the primary conceptual measures of economic activity.

The committee views the payroll employment measure, which is based on a large survey of employers, as the most reliable comprehensive estimate of employment. This series reached a peak in December 2007 and has declined every month since then.

The committee identified December 2007 as the peak month, after determining that the subsequent decline in economic activity was large enough to qualify as a recession.

Slow
02-08-2009, 11:18 AM
Two months of negative growth.

See, being succinct and pithy is always much better. :)

Huggy85
02-08-2009, 11:20 AM
Two months of negative growth.

See, being succinct and pithy is always much better. :)

Many months of negative growth, beginning in December, 2007

Slow
02-08-2009, 11:22 AM
Many months of negative growth, beginning in December, 2007

LOL!

I know it can be "many months", most recessions are. But that's how long they LAST...I'm talking about BEGINNINGS.

I'm saying they officially BEGIN when a country experiences two consecutive months of negative growth!

LOL!!

Huggy85
02-08-2009, 11:27 AM
LOL!

I know it can be "many months", most recessions are. But that's how long they LAST...I'm talking about BEGINNINGS.

I'm saying they officially BEGIN when a country experiences two consecutive months of negative growth!

LOL!!

Yes, beginnings are what matters. And the National Bureau of Economic Research has clearly stated that the recession beginning was in December, 2007. I'm still waiting for you to back up your statement that the recession started in December 2008.

Anything! From anyone! C'mon, produce a link,source.

Huggy85
02-08-2009, 11:29 AM
I'm saying they officially BEGIN when a country experiences two consecutive months of negative growth!

LOL!!

Months?????

It used to be quarters.

bohd
02-08-2009, 11:30 AM
Do not fight with god(slow) ....he "always" wins lolololololololololol

Slow
02-08-2009, 11:33 AM
Only half the people in that report you cite from NBER believe the recession started in 2007. Why is that a slam dunk?? Because you want it to be?

Read your own links! LOL

Slow
02-08-2009, 11:34 AM
Months?????

It used to be quarters.

My bad...I meant quarters.

Huggy85
02-08-2009, 11:38 AM
Only half the people in that report you cite from NBER believe the recession started in 2007. Why is that a slam dunk?? Because you want it to be?

Read your own links! LOL

And where is your link to an article that states that anyone, let alone half of a committee comprised of economics professionals, believes that the recession started in Dec. 2008?

Produce a link "LOL"

And it was the committee as a whole that issued the statement. Show me where it said anything about "half of the committee"

Slow
02-08-2009, 11:41 AM
Your anger is palpable :)

http://news.bbc.co.uk/2/hi/business/7495340.stm

Slow
02-08-2009, 11:43 AM
:) :) :)

The National Bureau of Economic Research, the official caller of recessions, recently said we are now in a recession that started one year ago, in December 2007.

"The committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months."


This struck me as odd. Not that I don't believe we are in a recession now, but the starting date of December 2007 just seemed too early to me. To see if this made sense, I looked at some underlying economic data and the NBER's explanation, such as it is. Why this might be important, I'll explain later.

The rule of thumb for defining a recession is two consecutive quarters of negative real growth in GDP. This is now the second recession called by the NBER in the two terms of President George W. Bush, yet in neither case were there two such consecutive quarters. In fact, at no time in Bush's Presidency were there two such quarters.

Of all 11 NBER-called recessions since 1947, only one other involved no two consecutive quarters of negative real growth. That was the recession of April 1960 to February 1961. However, that recession involved one quarter with significant negative growth, -5.1% annualized, and a cumulative -1.0% growth for a whole year

Compare that to Bush's two "recessions." In 2001

* No two consecutive quarters of negative growth.
* Worst single quarter: -1.4% annualized.
* Year-to-year: +0.2% (positive real growth, 4Q2000 to 4Q2001).


In 2007

* No two consecutive quarters of negative growth.
* Last four quarters: -0.2%, +0.9%, +2.8%, -0.5%.
* Year-to-year: +0.7% (positive real growth, 3Q2007 to 3Q2008).


In all the other nine recessions since 1947, the NBER-called recession involved at least one quarter of year-over-year negative real growth.

President Bush deserves some sort of prize for getting two recessions assigned to him, yet never presiding over either (1) two consecutive quarters of negative real growth, or (2) year-over-year negative real growth. I think that's a first. It certainly is in the last 60 years.

But the NBER does not use the "rule of thumb." Here is how the NBER explains its method.

"The committee's procedure for identifying turning points differs from the two-quarter rule in a number of ways. First, we do not identify economic activity solely with real GDP, but use a range of indicators. Second, we place considerable emphasis on monthly indicators in arriving at a monthly chronology. Third, we consider the depth of the decline in economic activity. Recall that our definition includes the phrase, "a significant decline in activity." Fourth, in examining the behavior of domestic production, we consider not only the conventional product-side GDP estimates, but also the conceptually equivalent income-side GDI estimates. The differences between these two sets of estimates were particularly evident in 2007 and 2008."


Get it? I don't. I mean I sort of understand it, but I could never duplicate the NBER's results with that explanation. No one could. It lacks transparency. If the NBER explains its method elsewhere, I could not find it and no such link was provided in its FAQ on the matter.

For example, in the 2001 "recession", why does the NBER say it started in March, under Bush, and not in 2000, under Clinton? The first quarter of negative real growth was actually the third quarter of 2000, under President Clinton. It showed -0.5% growth contraction, annualized. But the NBER said no recession. When it again showed -0.5% growth six months later, under Bush, the NBER said recession.

In 2007, the final revision of the estimate of fourth quarter growth was slightly negative: -0.2%. The NBER now says that was a recession. One quarter of -0.5% under Clinton, not a recession. One quarter of -0.2% under Bush, a recession.

Maybe unemployment was more of a factor in the NBER's analysis.

When the NBER said the recession of 2001 started, the unemployment rate was 4.3%. That's pretty low. In fact, the unemployment rate was 4.3% or higher in every single month of President Clinton's first term, and every single month of his second term until March of 1999. No recession that whole time.

What about in December 2007, the beginning of our current "recession"? The unemployment rate was 5.0%. Then it dropped below that for the next two months and still stood at 5.0% in April of 2008. Again, the unemployment rate was at or above 5.0% in every single month of Clinton's recession-free first term. It did not go below 5.0% until May of 1997.

Well, neither real GDP nor the unemployment rate quite explains the NBER's method. The NBER said it looks at the "income side." So let's try Disposable Personal Income in real dollars.

In three of the last four months of 2000, all under President Clinton, real DPI declined. NBER said no recession. In the next three months, or the first three months of 2001 and mostly under President Bush, real DPI increased in each month. NBER said recession. Decline in three of four months, no recession. Increase in three of three months, recession.

Just for fun, I looked at quarterly GDP numbers since 1947 and all 11 NBER recessions called since that year. Here are a couple of interesting observations.

(cont'd below)

Slow
02-08-2009, 11:43 AM
(1) Every time there was at least one quarter of year-to-year negative real GDP growth, there was a recession associated with it. There were no recessions without such negative year-to-year growth, with two exceptions.

(2) With simple rules based on real GDP numbers alone, a recession as well as its beginning and ending quarters could be called. Every recession called by these rules was also called by the NBER. Every recession called by the NBER was also called by these rules, with two exceptions. For every recession these rules called that matched the NBER recessions (9 of the 11), the starting and ending quarters matched within one quarter, at worst. What were these simple rules?

* A recession starts in a given quarter when that quarter-to-next-quarter's growth is negative and the total growth over the two quarters combined is also negative. (A somewhat weaker version of the "two quarters" rule.)
* A recession ends as many quarters after that beginning quarter as there remains cumulative negative growth.


That is, without trying really hard, using real GDP data easily available from the St. Louis Fed only, and programming simple rules in a spreadsheet, I was able to match 9 of the 11 NBER-called recessions, with no false alarms and with, at most, one quarter mis-match in timing. The only two exceptions in any of this? The two recessions under George W. Bush.

My simple rules said no recession in either case (yet called all other recessions, with no false alarms).

The year-to-year negative growth rule said no recession in either case (yet called all other recessions, with no false alarms).

The "two quarters" in a row rule said no recession in either case (yet called all but one other recession, with no false alarms).

(It's still possible, by any of these rules, that we are in a recession now, but one that started in the third quarter of 2008, meaning July at the earliest. But for any of these rules to kick into effect, we need the fourth quarter's data.)

I'm sure the NBER has good reasons for calling and timing the two Bush recessions. But even it would have to admit that those two recessions are anomalous -- oddballs among the 11 recessions in the last 60 years.

Why would this matter? Why would it matter whether the US recession started in December of 2007 or July of 2008, for example? After all, President Bush presided in either case.

Here is why. Europe is now in recession, and it started in the second quarter measured the old-fashioned way: two consecutive quarters of negative real growth in 2008. The US did not have its first quarter of negative growth until the third quarter of 2008. The question is whether the recession spread from Europe to the US or vice versa.

If the US recession started in 2007, as the NBER states, Europe caught our cold. If we go by the simple rule of two negative quarters in a row, we are catching Europe's cold. It's all about who gets the blame, at least plausibly so.

In 2001, President Bush got the blame instead of President Clinton, per the NBER.

In both cases, blame Bush. In this second case, blame Bush not only for a US recession, but a global recession. If Iceland is bankrupt, it must be Bush's fault.

Yet in both cases, we don't know exactly how the NBER did it.

Here is what the NBER says about itself:

Committee members are: Robert Hall, Stanford University (chair); Martin Feldstein, Harvard University and NBER President Emeritus; Jeffrey Frankel, Harvard University; Robert Gordon, Northwestern University; James Poterba, MIT and NBER President; David Romer, University of California, Berkeley; and Victor Zarnowitz, the Conference Board. Christina Romer of the University of California, Berkeley, resigned from the committee on November 25, 2008, and did not participate in its deliberations of November 28.


Christina Romer (formerly on the committee) was just designated as the chair of Barack Obama's economic advisors. She is married to David Romer (on the committee).

Here's how the NBER might help: tell us exactly the formula for calling and timing a recession and give us the input data so that we can reproduce its results. If it can't, or won't, it should not be considered the "official" caller of recessions in my opinion.

In my opinion, there should be both transparency and clear objectivity in calling and timing recessions. The method should be repeatable and based on publicly available data. It should be more than simply the considered, consensus opinion of a panel of seven experts. Otherwise we invite public doubt -- public doubt in the area of cause and effect of economic downturns. This is important stuff -- or should be, in a democracy.

Data sources:

* St. Louis Federal Reserve Economic Data (http://research.stlouisfed.org/fred2/) for real GDP (GDPC96), real Disposable Personal Income (DSPIC96) and Civilian Unemployment Rate (UNRATE).
* NBER (http://wwwdev.nber.org/cycles/dec2008.html) for latest recession announcement, FAQs on recession definition, and official recession dates (http://www.nber.org/cycles.html).

Slow
02-08-2009, 11:46 AM
:) :) :)

Slow
02-08-2009, 11:48 AM
http://www.youtube.com/watch?v=9hUy9ePyo6Q

Huggy85
02-08-2009, 11:49 AM
Your anger is palpable :)

http://news.bbc.co.uk/2/hi/business/7495340.stm

LOL - too funny

There's that bogus definition again - and you couldn't link to anything that references the recession in America.

Even if your definition is correct, your article says that "One of the problems about officially declaring a recession is that one can only confirm it after it has happened."

In other words, if you experience 2 quarters of negative growth, one can, after those two quarters are over, proclaim that the economy started to contract (i.e. the recession began) two quarters ago.

Slow
02-08-2009, 11:50 AM
Is that panic??

It is! It is panic!!

LOL!!!!

Better luck next time, Tiger :)

Huggy85
02-08-2009, 11:53 AM
This debate has nothing to do with Bush. Why do you feel the need to post obvious Right Wing articles that defend him?

Slow
02-08-2009, 11:55 AM
http://74.125.47.132/search?q=cache:8QYZ2aL6H-AJ:www.shadowstats.com/article/57+NBER+recession+report+flawed&hl=en&ct=clnk&cd=2&gl=us&client=firefox-a

Slow
02-08-2009, 11:57 AM
This debate has nothing to do with Bush. Why do you feel the need to post obvious Right Wing articles that defend him?

Whistling past the graveyard, EH?

That didn't defend Bush, it showed how flawed the report you are in love with is.

Care to address the part of the article that talks of recession?

Of course you don't ;)

Huggy85
02-08-2009, 12:04 PM
http://74.125.47.132/search?q=cache:8QYZ2aL6H-AJ:www.shadowstats.com/article/57+NBER+recession+report+flawed&hl=en&ct=clnk&cd=2&gl=us&client=firefox-a

So if Walter J. "John" Williams is such a good reference, I suspect you'll agree with him when he says this too.

http://newsformom1.blogspot.com/2008/08/walter-j-john-williams-ab-in-economics.html

The U.S. economy is in an intensifying inflationary recession that eventually will evolve into a hyperinflationary great depression. Hyperinflation could be experienced as early as 2010, if not before, and likely no more than a decade down the road. The U.S. government and Federal Reserve already have committed the system to this course through the easy politics of a bottomless pocketbook, the servicing of big-moneyed special interests, and gross mismanagement.

The U.S. has no way of avoiding a financial Armageddon. Bankrupt sovereign states most commonly use the currency printing press as a solution to not having enough money to cover their obligations. The alternative would be for the U.S. to renege on its existing debt and obligations, a solution for modern sovereign states rarely seen outside of governments overthrown in revolution, and a solution with no happier ending than simply printing the needed money. With the creation of massive amounts of new fiat (not backed by gold) dollars will come the eventual complete collapse of the value of the U.S. dollar and related dollar-denominated paper assets.

What lies ahead will be extremely difficult and unhappy times for many. Ralph T. Foster, in his "Fiat Paper Money", closes his book’s preface with a particularly poignant quote from a 1993 interview of Friedrich Kessler, a law professor at Harvard and University of California Berkeley, who experienced the Weimar Republic hyperinflation:

"It was horrible. Horrible! Like lightning it struck. No one was prepared. You cannot imagine the rapidity with which the whole thing happened. The shelves in the grocery stores were empty. You could buy nothing with your paper money."
Posted by Todd at 8/25/2008
0 comments:

Huggy85
02-08-2009, 12:07 PM
http://www.shadowstats.com/article/292

Slow
02-08-2009, 12:07 PM
Explaining how a recession works and making predictions are two different things. One is concrete, one is conjecture. I can totally agree with Williams' explanation of something, yet disagree with his predictions.

Two very different things.

Nice to see you are moving the goalposts ;)

Huggy85
02-08-2009, 12:12 PM
And I'm still waiting for something that supports your claim the the recession in America (not the UK) started in Dec. 2008.

Slow
02-08-2009, 12:12 PM
LOL!!!

Have a good one. I've provided all you wanted, and more.

Huggy85
02-08-2009, 12:21 PM
You obviously misunderstand the article you posted the link to. The author, Walter J "john" Williams stated as early as June 6, 2008, that the US was already in recession.

http://www.shadowstats.com/article/329

GDP Benchmark Revisions Should Show Weaker Historical Economy.With consensus expectations running around 1.8% (briefing.com) for the "advance" estimate of annualized real (inflation-adjusted) second-quarter GDP growth — up from 1.0% in the first quarter — such likely will be targeted by the Bureau of Economic Analysis (BEA). The report, due on July 31st (next Thursday), however, will include annual revisions back through the first quarter of 2005. The revisions should show historically weaker growth in the GDP than previously reported by the BEA. The current recession even could show up in the detail.

"The current recession"

From June 6, 2008

http://www.shadowstats.com/article/313

The reported fifth consecutive decline in monthly payrolls as of May indicated a recession in place, with annual payroll growth on the brink of turning negative. The sharp upturn in unemployment also was consistent with a contracting economy. Still, as has become the standard pattern — with fairly predictable gimmicks — the weakness in the jobs report was understated, even beyond the apparent manipulation of seasonal factors.

"fifth consecutive decline in monthly payrolls as of May indicated a recession in place"

From July 16, 2008, same author

http://www.shadowstats.com/article/328

On the recession front, real (inflation-adjusted) second-quarter retail sales contracted for the fourth consecutive quarter, while second-quarter industrial production showed a sharp quarterly contraction. In conjunction with consecutive quarterly contractions in payroll employments, these numbers should remove any doubt of the economy being in recession. Whether or not such is reflected in upcoming GDP revisions and reports, tax revenues will fall off sharply, again intensifying the government’s fiscal problems.

"these numbers should remove any doubt of the economy being in recession"

Huggy85
02-08-2009, 12:36 PM
LOL!!!

Have a good one. I've provided all you wanted, and more.

Run away! Run away!

LOL!