Where is the US economy headed?

Roxxxanne wrote:

And the tax policy?

That's part of fiscal policy. Everything I said about fiscal policy applies to tax policy too. In particular, it was prudent and responsible under Bush I and Clinton, imprudent and irresponsible under Reagan and Bush II.

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The global markets have taken a beating after the US markets closed.

Nobody still has any idea how deep the housing market downturn will affect the US economy - or the worlds.

Some are beginning to talk about a recession.

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Some?

Most of those in the know are saying we're in one right now...

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many in the know believe the moon landing was done at a film studio in Arizona and the the world is flat.

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Miller wrote:

Some?

Most of those in the know are saying we're in one right now...

The economy has not met the definition for a recession - yet.

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cicerone imposter wrote:

Miller wrote:
Some?

Most of those in the know are saying we're in one right now...

The economy has not met the definition for a recession - yet.

Your definition , not that of the economists...

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a slowing in the rate of growth in the gdp is hardly the same as a decline in the gdp.

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Miller wrote:

cicerone imposter wrote:
Miller wrote:
Some?

Most of those in the know are saying we're in one right now...

The economy has not met the definition for a recession - yet.

Your definition , not that of the economists...

Interesting comment, can you justify it?

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Recession: The BCDC Definition
The Business Cycle Dating Committee at the National Bureau of Economic Research (NBER) provides a better way to find out if there is a recession is taking place. This committee determines the amount of business activity in the economy by looking at things like employment, industrial production, real income and wholesale-retail sales. They define a recession as the time when business activity has reached its peak and starts to fall until the time when business activity bottoms out. When the business activity starts to rise again it's called an expansionary period. By this definition, the average recession lasts about a year.

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My conclusion is based on comments which I read, this past weekend in one or more of the following publications:

WSJ
Barrons
Financial Times
Economist

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Miller wrote:

My conclusion is based on comments which I read, this past weekend in one or more of the following publications:

WSJ
Barrons
Financial Times
Economist

Can you summarize for us the content of what you read? I would really appreciate it.

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Miller wrote:

Most of those in the know are saying we're in one right now...

Could you please name three, and link to where they're saying this?

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I've read a number of "investment analysts/talking heads" predict a soon coming recession. The only economists I've read recently have predicted/projected USA GDP grown for 2007 of between 1.8% and 4%.
The most recent I've read (this morning) projects a GDP growth of 2007 @3.77%

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dyslexia wrote:

I've read a number of "investment analysts/talking heads" predict a soon coming recession. The only economists I've read recently have predicted/projected USA GDP grown for 2007 of between 1.8% and 4%.
The most recent I've read (this morning) projects a GDP growth of 2007 @3.77%

The same impression I'm getting from what I've been reading.

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cicerone imposter wrote:

Recession: The BCDC Definition
The Business Cycle Dating Committee at the National Bureau of Economic Research (NBER) provides a better way to find out if there is a recession is taking place. This committee determines the amount of business activity in the economy by looking at things like employment, industrial production, real income and wholesale-retail sales. They define a recession as the time when business activity has reached its peak and starts to fall until the time when business activity bottoms out. When the business activity starts to rise again it's called an expansionary period. By this definition, the average recession lasts about a year.

That definition (at least as you have described it) is basically meaningless without a specification of the minimum time scale for the discrete measurements of activity. This is exactly the sort of vaguery that makes most contemporary arguments about just what "phase" of a presumed economic cycle we are in, so useless. However it does provide a good deal of grist for the mills of the talking heads and commentators.

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georgeob1 wrote:

cicerone imposter wrote:
Recession: The BCDC Definition
The Business Cycle Dating Committee at the National Bureau of Economic Research (NBER) provides a better way to find out if there is a recession is taking place. This committee determines the amount of business activity in the economy by looking at things like employment, industrial production, real income and wholesale-retail sales. They define a recession as the time when business activity has reached its peak and starts to fall until the time when business activity bottoms out. When the business activity starts to rise again it's called an expansionary period. By this definition, the average recession lasts about a year.

That definition (at least as you have described it) is basically meaningless without a specification of the minimum time scale for the discrete measurements of activity. This is exactly the sort of vaguery that makes most contemporary arguments about just what "phase" of a presumed economic cycle we are in, so useless. However it does provide a good deal of grist for the mills of the talking heads and commentators.

georgeob, Rather than attack the NBER definition, why don't you post one that suits you? As you well know, if you've done any research to find a definition for "recession," there are more pros and cons to confuse most experts.

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I'm not "attacking" anything. Instead I merely pointed out a fundamental and crippling flaw in the definition and noted that it is just such omissions that so often lead to (in my view) rather useless, often unending, disputes over the question.

The reality of economic activity is far more complex and locally varied than these simplistic constructs can express. There is nothing in my life that requires me to "know" whether or not current economic activity fits into this or that definition of a recession or an expansion. Furthermore the constructs are not particularly helpful in aiding my understanding of what does affect me.

In general these constructs are useful only in the retrospective analysis of major trends.

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Bully for you!

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georgeob1 wrote:

That definition (at least as you have described it) is basically meaningless without a specification of the minimum time scale for the discrete measurements of activity.

Huh? If the definition is "two or more consecutive quarters of economic decline", then the minimum time scale is implicitly defined as one quarter. What's unspecified about it? And anyway, what difference would it make if the interval was a month instead?

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Thomas wrote:

georgeob1 wrote:
That definition (at least as you have described it) is basically meaningless without a specification of the minimum time scale for the discrete measurements of activity.

Huh? If the definition is "two or more consecutive quarters of economic decline", then the minimum time scale is implicitly defined as one quarter. What's unspecified about it? And anyway, what difference would it make if the interval was a month instead?

Please read the referenced poasts. There was no specification of the minimum time scale in the referenced definition, and the absence of one in the associated dispute was indeed the very reason the disputers were merely talking past each other.

Surely one as well versed in physics and economics as you understands the problems attendant to discrete sampling of continuous variables and the aliasing and other distortions that can result. They are indeed dependent on the sampling interval, despite your assertion to the contrary.

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Where is the US economy headed?

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