In technical terms, we cannot call what the United States is now going through an economic downturn. Economic misery as a real-life condition persists, however a government panel announced Monday the recession officially finished in June 2009. This has been the longest slide since World War II as the economic downturn lasted 18 months after starting in December 2007. Before the “Great Recession” was over, it earned that title. It was already bad. The economy isn’t expected to go back to its normal state within the near future. Of course, it has continued growing though. The Federal Reserve is doing every little thing it can to prevent a “growth recession” from happening where the economy doesn’t expand fast enough for unemployment.
Recession runner up to Depression
The economy growing again showed that the longest recession since the Good Depression was over. The National Bureau of Economic Research tells us this. The Los Angeles Times lets us know the recession is totally over. This means it would be a new recession if a double dip were to occur. The Great Recession is second to the Great Depression in length. The Economic downturn was only 18 months even though the Depression was between 1929 and 1933, making it 43 months. Between 1973-75 and 1981-82 there were two 16 month recessions. There were over 8 million people with job losses. The recovery of the labor market may be too slow. The NBER said probably the most damaging factors in this recession was rapid productivity growth, which deleted jobs as output was marginally sustained.
Recession ended on paper, however not on the street
Last Spring, the NBER has a warning to give. They said that any growth being seen may just be too small. The Washington Post reports that the NEBR defines a recession as “a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real gross domestic product (GDP), real income, employment, industrial production, and wholesale-retail sales.” Since June 2009, GDP and industrial production totally bottomed out. Employment, however, did not start expanding until December 2009. The NEBR said that by declaring a specific date for the end of the economic recession it was not saying that economic conditions are favorable since then.
Info on a growth recession
The growth economic downturn is shown as the unemployment rate weakens even though the economy expands. Economic growth was at 3.7 percent within the first quarter of 2010, claims Bloomberg. It then dropped to a 1.6 percent annual rate for the second quarter. A 5 percent rate of growth in the fourth quarter of 2009 raised hopes that economic recovery was gathering steam. The consumer spending needed to strengthen the economy is not occurring with the unemployment rate at 9.5 percent. The economy could be aided with tools Fed chairman Ben Bernake states he has. With rates of interest near zero, some think the next step for the Fed is to buy more Treasuries, or government debt. Numerous people think that individuals just need jobs. This would help America’s economy a lot.
Find more information on this subject
Los Angeles times
latimes.com/business/la-fi-recession-20100920,,4014811.story
Washington Post
voices.washingtonpost.com/political-economy/2010/09/its_official_the_great_recessi.html
Bloomberg
bloomberg.com/news/2010-09-19/escaping-double-dip-to-growth-recession-means-no-unemployment-relief-seen.html
