The National Bureau of Economic Research announced yesterday that the recession which began in December of 2007 officially ended in June of 2009, making it the longest recession since WWII. To quote their release – “The basis for this decision was the length and strength of the recovery to date.”
I guess I have no right to argue with their methodology since they are the official government arbiter of such decisions. But coming on the same day that the President acknowledged that there are no quick fixes for the economy, I guess I have to ask whether we need to redefine the term recession. Everyone talks about the “new normal” caused by the economic downturn of the last few years. Maybe we need to redefine how we look at and describe the country’s overall economic condition.
With foreclosures still on the rise, and more Americans at or below the poverty level than in decades, is there really any other logical response other than “Really?” It doesn’t feel like the recession has ended. If anyone sees any value-added in this announcement will you please let me know?
The only thing this announcement does is officially end any talk of a double-dip recession. Why? Well, officially we are no longer in a recession and have not been since last June. Therefore if we were to once again experience two straight quarters of negative GDP growth we would be in a new recession – not a double-dip recession. It would just be another recession on top of the earlier recession. Other than this little fact, I am still scratching my head over the announcement. Please show me the “length and strength of the economy.” I don’t think many people see it.
A new definition of recession seems apropos……….Or perhaps the government should curtail their message a little if the NBER wants to have any credibility in the future.
