Where is the economy right now?
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Where is the economy right now?
Disregarding official pronouncements of growth or recession, where do you see the U.S. economy now?
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'Modern Day Depression' is so hard to express without people conjuring up notions of the great depression.
Since 'modern day' implies things being drastically different, one has to figure that the iconic pictures of the 30's with people standing in bread lines is *not* how we have to think about it. SNAP and unemployment, that keeps being extended, are the new bread lines. Massive mass food production didn't exist in the 30's. Super Walmarts and Targets didn't exist back then. It is simply *way* easier to hand this stuff out digitally and make the visible picture of a bread line non-existent.
Since those figures keep going up and up...I'm hard pressed to say anything rosier then entering a 'severe recession' and bordering on depression. Some parts of the economy always grow, regardless of the macro picture. So pointing to any growth is pointless. Take out inflation and lets see where the growth is even on some of the core economic components.
Since 'modern day' implies things being drastically different, one has to figure that the iconic pictures of the 30's with people standing in bread lines is *not* how we have to think about it. SNAP and unemployment, that keeps being extended, are the new bread lines. Massive mass food production didn't exist in the 30's. Super Walmarts and Targets didn't exist back then. It is simply *way* easier to hand this stuff out digitally and make the visible picture of a bread line non-existent.
Since those figures keep going up and up...I'm hard pressed to say anything rosier then entering a 'severe recession' and bordering on depression. Some parts of the economy always grow, regardless of the macro picture. So pointing to any growth is pointless. Take out inflation and lets see where the growth is even on some of the core economic components.
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All these words are well defined, so I am not sure what exactly we should disregard.
Depression: 10% decline in GDP
Recession: GDP decline for 2 consecutive quarters.
Growth: GDP growth.
I am confused what exactly we should disregard.
Last Qtr. GDP had positive growth, so current state of US economy is "Growth".
Depression: 10% decline in GDP
Recession: GDP decline for 2 consecutive quarters.
Growth: GDP growth.
I am confused what exactly we should disregard.
Last Qtr. GDP had positive growth, so current state of US economy is "Growth".
But. if this quarter and the next had declines, then wouldn't that make the current state Recession?hsv_climber wrote:All these words are well defined, so I am not sure what exactly we should disregard.
Depression: 10% decline in GDP
Recession: GDP decline for 2 consecutive quarters.
Growth: GDP growth.
I am confused what exactly we should disregard.
Last Qtr. GDP had positive growth, so current state of US economy is "Growth".
According to the US Bureau of Economic Analysis, real consumer spending, adjusted for inflation is higher now than it was at the peak in 2007 prior to the recession.
http://www.schwab.com/public/schwab/res ... ctive.html
http://www.schwab.com/public/schwab/res ... ctive.html
"I'm not so much concerned about the return on my money as the return of my money" - Will Rogers
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As long as Europe's problems don't get much worse (Instead of just Greece defaulting, every member of the PIIGS default and bring down global banks with them)... my guess is (very) slow growth.
Even if hiring rebounds it will takes years for unemployment rates to approach 6%. Housing will continue to be stagnant in many areas as long as hiring/incomes growth is minimal.
Like someone else mentioned, the economy in farming communities appear to be plugging along due to higher commodity prices, and that might be a bright spot.
Even if hiring rebounds it will takes years for unemployment rates to approach 6%. Housing will continue to be stagnant in many areas as long as hiring/incomes growth is minimal.
Like someone else mentioned, the economy in farming communities appear to be plugging along due to higher commodity prices, and that might be a bright spot.
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I think for purposes of this question where we assess what the economy is doing TODAY, we don't want to wait 6 months for two consecutive quarters to identify a recession. That is why many recessions are not made official until they are over with. If GDP is declining this week vrs last week, a snapshot will show decline. But because these snapshots are so time limited, they could change by next week. You make the call on how long the minimum evaluation period should be.hsv_climber wrote:All these words are well defined, so I am not sure what exactly we should disregard.
Depression: 10% decline in GDP
Recession: GDP decline for 2 consecutive quarters.
Growth: GDP growth.
I am confused what exactly we should disregard.
Last Qtr. GDP had positive growth, so current state of US economy is "Growth".
The NBER is generally regarded as the official arbiter of recessions. Their definitions are different than yours.hsv_climber wrote:All these words are well defined, so I am not sure what exactly we should disregard.
Depression: 10% decline in GDP
Recession: GDP decline for 2 consecutive quarters.
Growth: GDP growth.
I am confused what exactly we should disregard.
Last Qtr. GDP had positive growth, so current state of US economy is "Growth".
http://www.nber.org/cycles/recessions_faq.html
http://www.nber.org/cycles/recessions.html
livesoft wrote:5 is the right answer for large values of 2.tadamsmar wrote:Disregarding math, 2+2 =
...
5
--Political comments deleted==
Disregarding all visual information, what color is my type:
1. Growth Green
2. Recesssion Grey
3. Depression Grey
(I am disregarding those political comments that have been deleted)
Weak growth
Between growth and mild recession there should be a choice of weak growth. That is what it is now, the economy is growing but the growth is way below the 4.5% level which can meaningfully reduce unemployment.
I just heard Krugman say we were in a depression on Colbert. He has been using this language for a while:
--Political/economic link removed--
Krugman might want to answer 1 and 4. Growth during a depression is possible. As Krugman points out, there were periods of growth during the Great Depression.
But Krugman points to a number of official pronouncements in the link I just cited, so you should disregard this post. :roll:
--Political/economic link removed--
Krugman might want to answer 1 and 4. Growth during a depression is possible. As Krugman points out, there were periods of growth during the Great Depression.
But Krugman points to a number of official pronouncements in the link I just cited, so you should disregard this post. :roll:
I prefer the second great contraction (Rogoff).
It is the second balance sheet recession in the 1900's. The first one was pretty grim. It required a highly inflationary world war to get us out of it.
Japan is still stuck in their balance sheet recession.
So I was forced to pick a modern day depression, though I remain invested at my AA, and we are currently bumping along at very tepid growth. Exactly as would be expected during the long period of time that is required to repair unsustainable debts run up by households in the US, and by certain sovereigns overseas.
It is the second balance sheet recession in the 1900's. The first one was pretty grim. It required a highly inflationary world war to get us out of it.
Japan is still stuck in their balance sheet recession.
So I was forced to pick a modern day depression, though I remain invested at my AA, and we are currently bumping along at very tepid growth. Exactly as would be expected during the long period of time that is required to repair unsustainable debts run up by households in the US, and by certain sovereigns overseas.
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I would agree that what we had was a contraction, and we may oscillate between mild growth and recession for years before we see vigorous growth again. Domestically, there is no driver of increased demand, other than consumer needs, which are likely to remain static, given the state of the consumer. Our only path to growth is coupled to growth overseas.detifoss wrote:I prefer the second great contraction (Rogoff).
It is the second balance sheet recession in the 1900's. The first one was pretty grim. It required a highly inflationary world war to get us out of it.
Japan is still stuck in their balance sheet recession.
So I was forced to pick a modern day depression, though I remain invested at my AA, and we are currently bumping along at very tepid growth. Exactly as would be expected during the long period of time that is required to repair unsustainable debts run up by households in the US, and by certain sovereigns overseas.
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Where do you see that growth coming from? Ceertainly not in the land of austerity - Western Europe is out. Emerging markets? - perhaps, but I believe they will be catching a cold from us at some point in the near future. Hopefully, the cold does not turn into a flu.dLdV wrote:I would agree that what we had was a contraction, and we may oscillate between mild growth and recession for years before we see vigorous growth again. Domestically, there is no driver of increased demand, other than consumer needs, which are likely to remain static, given the state of the consumer. Our only path to growth is coupled to growth overseas.detifoss wrote:I prefer the second great contraction (Rogoff).
It is the second balance sheet recession in the 1900's. The first one was pretty grim. It required a highly inflationary world war to get us out of it.
Japan is still stuck in their balance sheet recession.
So I was forced to pick a modern day depression, though I remain invested at my AA, and we are currently bumping along at very tepid growth. Exactly as would be expected during the long period of time that is required to repair unsustainable debts run up by households in the US, and by certain sovereigns overseas.
You are forgetting the The Great Atlantic and Pacific Tea Company, otherwise known as the A & P. It was quite comparable to Walmart and Target in its day. It was also quite controversial in its effect on the mom and pop grocery stores. I do not know what impact A & P had during the Depression, however.FredPeterson wrote: Super Walmarts and Targets didn't exist back then. It is simply *way* easier to hand this stuff out digitally and make the visible picture of a bread line non-existent.
The term "recession" has always implied a short term event to me. I do not view the current economic state as short term. If modern depression means a long term event consisting of shorter term periods of anemic growth followed by short recessions, and there are no significant changes in employment, that would be my view.
Labor participation, and real unemployment rates would have to drop markedly for me to think otherwise. It is a modern depression.
Sam
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"The Great Depression: A Diary" by Benjamin Roth is a really eye-opening read. For folks living during the Depression, the economy wasn't as cut-n-dried as high school history class makes it seem - there were lots of false starts and "We're in a recovery, oh wait, we're not, oh wait, it's getting better. Wait, worse..."
Here is my crackpot analysis, to be taken with a grain of salt. We in the West are victims of our own success. In developed countries, most common needs are met, and most of what I call "opportunity space", for lack of a better term, is largely occupied. The cost of satisfying the remaining need or want grows at some a^x curve, or it would already be done. This constrains opportunity space.GRT2BOUTDOORS wrote:Where do you see that growth coming from? Ceertainly not in the land of austerity - Western Europe is out. Emerging markets? - perhaps, but I believe they will be catching a cold from us at some point in the near future. Hopefully, the cold does not turn into a flu.dLdV wrote:I would agree that what we had was a contraction, and we may oscillate between mild growth and recession for years before we see vigorous growth again. Domestically, there is no driver of increased demand, other than consumer needs, which are likely to remain static, given the state of the consumer. Our only path to growth is coupled to growth overseas.detifoss wrote:I prefer the second great contraction (Rogoff).
It is the second balance sheet recession in the 1900's. The first one was pretty grim. It required a highly inflationary world war to get us out of it.
Japan is still stuck in their balance sheet recession.
So I was forced to pick a modern day depression, though I remain invested at my AA, and we are currently bumping along at very tepid growth. Exactly as would be expected during the long period of time that is required to repair unsustainable debts run up by households in the US, and by certain sovereigns overseas.
In contrast, opportunity space is abundant in poorly developed countries. The cost of attaining that next need, want or efficiency may be very low, and increasing on some shallow linear slope.
I don't know specifically where these opportunities lie, but they do exist, since the greater part of humanity is comparatively under developed. Having been a visitor to Korea in the 80's and 90's, I witnessed an incredible rate of development. There must be many places with ample opportunity space. Hopefully, there are many in the West with their eyes on the ball, searching out opportunities to develop for the best returns on capital investment.
Apologies for posting simplistic drivel. It's all I'm qualified to do.
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