Recession

[bush_cheney2004]

Neat comparison of this recession versus 7 others in the past 50 years.

This one is is currently 2 out of 8 but in a bad way.

So it's not even the worse....as any of us living long enough would know. Nothing like watching the Great 21st Century Depression on wide screen flat panel displays.

[lasrek]

This recession is a deliberate and calculated action, as it was back in the last depression. It is a transfer of wealth.

[msj]

And an update using revised GDP figures.

Looks like 4 quarters in a row of real GDP decline.

The worst since quarterly stats were kept back to 1947.

Informative post and really cool graph can be found here.

I have always preferred statistical substance over "living memory" anyway....

[bush_cheney2004]

...The worst since quarterly stats were kept back to 1947.

Sticking to that narrow timeframe, the worst war would have been Vietnam.

[Malaclypse the Younger]

This recession is a deliberate and calculated action, as it was back in the last depression. It is a transfer of wealth.

You mean a transfer of debt. Not many people have truly become richer as a result of this recession. The United States is sinking itself into bankruptcy when it's paying trillions of dollars in an attempt to stave off the effects of eight years of bad judgment. It really won't be too surprising to see America turn into Zimbabwe within the next decade.

[bush_cheney2004]

You mean a transfer of debt. Not many people have truly become richer as a result of this recession. The United States is sinking itself into bankruptcy when it's paying trillions of dollars in an attempt to stave off the effects of eight years of bad judgment. It really won't be too surprising to see America turn into Zimbabwe within the next decade.

American decisions about debt are a lot older than 2001. It will always be a lot better than Zimbabwe...Canada is proof enough of that.

[Oleg Bach]

American decisions about debt are a lot older than 2001. It will always be a lot better than Zimbabwe...Canada is proof enough of that.

Zimbabwe? Did you use spell check or did you really know how to spell that? Here in Toronto the bankers know it's all about attitude and belief - Lately the banksters are releasing public statements saying - "recession is over" _ I guess that's more profitable than saying doom and gloom? See we are pretty smart up here - we know there is not such thing as money - You guys actually believe in the stuff...we know it's a huge racket and religion - so let me send you a trillion dollar bailout --------------------------------FAITH----there - recession over!

[msj]

Here's another really good post on the GDP numbers.

Also mentions the fact that Canada's Q2 GDP came in at ~ (3%) [as in negative] on an annualized basis.

The scary thing is Canadians are buying up homes in the face of this economic decline and with the unemployment rate going up.

The power of low interest rates - seems to cut off circulation to the brain.

Anyway, an interesting quote from the linked article:

Consumer spending came in at -1.2% annualized, twice the decline expected by the consensus. This occurred in the face of gargantuan fiscal stimulus and leaves wondering how this critical 70% chunk of the economy is going to perform as the cash-flow boost from Uncle Sam’s generosity recedes in the second half of the year. Imagine, government transfers to the household sector exploded at a 33% annual rate, while tax payments imploded at a 33% annual rate and the best we can do is a -1.2% annualized decline in consumer spending in real terms and flat in nominal terms? What do we do for an encore? In the absence of the fiscal largesse, it is quite conceivable that consumer spending would have shrunk at a 10% annual rate last quarter!

[sharkman]

The media seems to be cheerleading us into a recovery, or at least trying. Ditto south of the border where Obama's crazy-eyed spending gets applauded. When the other shoe finally drops, how many will be left without a chair?

Edited August 5, 2009 by sharkman

[msj]

And if Obama did nothing and consumer spending shrunk by 10% and we saw, oh, I'll guess a negative 5% Q2, then Obama would be considered a "crazy-eyed" Hoover.

[msj]

To get a sense of how nasty the past 10 years have been in the US:

Naught for naught

[T]he private sector didn't just lose jobs over the last month or the last year -- it's lost jobs over the last decade.

[The private sector] ended up with a net loss of 223,000 jobs since August 1999, according to the latest figures from the Bureau of Labor Statistics. Meanwhile, the nation's population has grown by 33.5 million people.

That's the worst job-creating performance by the private sector since, you guessed it, the Great Depression.

[Pliny]

This recession is a deliberate and calculated action, as it was back in the last depression. It is a transfer of wealth.

A transfer of wealth to where?

Who deliberately calculated it?

[Pliny]

An interesting look at the lame duck economy that the US finds itself in right now:

Paul Krugman: The Lame-Duck Economy

Interesting parallels between 2008-2009 and 1932-33:

Paul Krugman...ha ha...if I want a laugh I read what Paul Krugman has to say.

It is true that the Bush administration is entirely different than the Hoover administration. The Hoover adminstration was only successful in keeping wages and prices high in all it's attempts to regualte the economy. I don't know if you know the story of the tailor who was jailed for three months for pressing a pair of pants for only 35 cents under the Roosevelt administration. It was unAmerican at the time to charge less than 40 cents. I got that information from the book "Liberal Fascism" by Jonah Goldberg. Just thought I would give him a plug. But anyway Roosevelt basically continued the programs started by Hoover in an attempt to "heal" the economy. One of Roosevelt's first acts on his own was to make it illegal for Americans to privately own gold.

This depression is different because the Bush administration wasn't in a crisis until the election had occurred. Obama is definitely changing course. The States survived Roosevelt and still carry a few of his scars and social burdens hopefully they will survive Obama and even recognize the damage that the great Roosevelt did.

Admittedly, Roosevelt lived in a time of progressivism and social experimentation where models like Mussolini and Hitler were being studied and even admired. Our own Tommy Douglas was enamoured with Hitler until he went to Germany and actually saw what Hitler was doing. He never abandoned his socialist ideology though, he just thought Hitler was a racist, which was true. Douglas was a great believer in Eugenics though and thought thigns like sterilization were ok.

Then there was the great communist experiment that never lasted much beyond Stalin - 30 years.

It was an economic disaster. It started in the great era of 'progressivism" as well. The socialist state had great promise then.

I heard Obama say we are on the road to recovery today in his Labour day speech. Tomoorow he is addressing the students of America on their first day in school and Wednesday is his big confrontation with Congress about his Health care bill. - That will be interesting. If I have learned anythign about government inmy years it is that what they say is happening pretty much the opposite of what is really happening. Wasn't it all rosy before the housing collapse?

[msj]

Paul Krugman...ha ha...if I want a laugh I read what Paul Krugman has to say.

If I want to read something funny I read Oleg's posts.

As for you - welcome to ignore.

[daniel]

...

This depression is different because the Bush administration wasn't in a crisis until the election had occurred. ...

So he's blaming the recession on Obama just for running in the election. Now that's funny.

[msj]

And a refresher for the usual morons suspects about the NBER and the official end of a recession (or will it be recessions?):

The End of the Official Recession?

[msj]

One of my biggest beefs in this thread has been the poor statistical methodology used to produce inflation, GDP and unemployment statistics.

Nevertheless, by understanding the methodology, many of the sources I have linked to in the past have been able to show a much better understanding of the US economy than many of the mainstream cheer leaders.

This post looks at the upcoming revisions to the employment statistics.

The BLS in the US is looking at adding a further 824,000 jobs lost to the already 4.8 million they already counted to the 12 months ended March 31, 2009.

Put another way:

Instead of 7.2 million net jobs lost since December 2007, the preliminary benchmark estimate suggests the U.S. has lost over 8.0 million net jobs during that period.

Even before the annual revision, the current employment recession was already the worst recession since WWII in terms of percent of job losses. The benchmark revision shows this recession was even deeper. The revision will be reported in February ... just something to remember over the next few months.

Don't forget to check out the post and the pretty, albeit scary looking, graph.

[sharkman]

I've recently read in the Globe and Mail that the US has lost another 263,000 jobs in September, more than the 180,000 expected. Also, 571,000 Americans dropped out of the job market altogether, so they aren't even counted in the official unemployment rate, which at 9.8 is actually lower than it should be.

Obama may be hurting at least as much as he is helping. The Cash for Clunkers car campaign, in which people could trade in their older vehicle and get government assistance to buy a new car, has seriously hurt the car business. No one's buying cars at all now, all the program did was create an artificial buying spree by those who might buy a car in the next year. Now the dealerships are hurting again except for Saturn dealers, who won't be hurting for long since they are being axed by GM.

A recession is a recession. It's going to take time for it to pass. Many feel Obama should have let the market reach a new lower equilibrium by itself instead of trying to keep the level artificially high by pumping money into the system. The stimulus may do the exact same thing that the Clunkers program did, help sales while it's in effect, but then the economy sinks back down looking for it's natural equilibrium. Perhaps you can spend your way out of a recession, I'm not sure, but buy only spending about 11-15% of the Stimulus in 2009 it seems like not enough as month after month we see job losses that exceed predictions.

[msj]

Yes, another case of damned if I do and damned if I don't.

Don't give $4,500 of "free money" out for cars and be accused of doing nothing.

Don't give out $8,000 per house for "first time home buyers" and also be accused of doing nothing.

Do nothing and watch official unemployment (U3) go to 12% or more and watch U6 go to 21% or more (currently around 17%).

Do something like stimulus or healthcare reform, anything except starting a war, and be accused of running up the deficit.

Must be tough to be the President in such a ridiculous country.

[bush_cheney2004]

.....Must be tough to be the President in such a ridiculous country.

Well, yea...but even a bad day as US president is better than a good day as PM of Canada.

[msj]

An update on this thread: looks like this should have been called the "Great Contraction" instead of "Recession."

Nice charts showing Real GDP, Real GDP per capita and Employment compared all the way back to 1960.

[bush_cheney2004]

...Nice charts showing Real GDP, Real GDP per capita and Employment compared all the way back to 1960.

Oh....this is just for the US? I thought you meant recession in global terms. Nevermind.

[Bonam]

An update on this thread: looks like this should have been called the "Great Contraction" instead of "Recession."

Nice charts showing Real GDP, Real GDP per capita and Employment compared all the way back to 1960.

What a distorted way to show charts, always showing only losses but never showing the growth in between recessions? Try something like this:

http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=ny_gdp_mktp_cd&idim=country:USA&dl=en&hl=en&q=us+gdp#ctype=l&strail=false&nselm=h&met_y=ny_gdp_pcap_cd&scale_y=lin&ind_y=false&rdim=country&idim=country:USA&ifdim=country&hl=en&dl=en

[msj]

What a distorted way to show charts, always showing only losses but never showing the growth in between recessions? Try something like this:

http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=ny_gdp_mktp_cd&idim=country:USA&dl=en&hl=en&q=us+gdp#ctype=l&strail=false&nselm=h&met_y=ny_gdp_pcap_cd&scale_y=lin&ind_y=false&rdim=country&idim=country:USA&ifdim=country&hl=en&dl=en

Umm, the purpose is clearly to compare the current contraction to other contractions which is a useful way to look at things.

Edited: I should have stated when I posted the charts above that one should read the commentary that goes along with them to better understand what is being looked at.

I supposed I take this for granted (I usually read this stuff and then look at the charts rather than just look at the charts) hence the postings by BC and Bonam....

Edited September 1, 2011 by msj

[bush_cheney2004]

Umm, the purpose is clearly to compare the current contraction to other contractions which is a useful way to look at things.

Right...for the USA only. Why it's in Canada/US Relations escapes me.

Edited: I should have stated when I posted the charts above that one should read the commentary that goes along with them to better understand what is being looked at.

The post was about slammin' charts, not "commentary", so I looked at the charts.

I supposed I take this for granted (I usually read this stuff and then look at the charts rather than just look at the charts) hence the postings by BC and Bonam....

You know what they say about the word "assume"....

Edited September 1, 2011 by bush_cheney2004