When will the recession end?

[I spent the winter writing songs about getting better]

Typically by a normal pattern it would in the first half of 2009, but this one may take longer. Tough to say.

[Queen Mum Inks.LWC]

Q2 2010

[Torie]

It is going to be a long time baby. Even if it ends, growth rates will be anemic. This massive borrow and spend is not going to work out very well, is my best guess.

[Sam Spade]

Amusingly, the recession still hasn't started yet according to GDP.  Of course, that's a joke.

Of course, the government is known to inflate things to make it look better.  So, probably the powers that be will show some growth for two consecutive quarters sometime before the elections in 2010.  In fact, I would bet on it.

But let me be frank.  What we're seeing right now is only the beginning.  It's going to be ugly, worst since the Great Depression, maybe worse in fact.  We'll see.

[Lunar]

Amusingly, the recession still hasn't started yet according to GDP.  Of course, that's a joke.

Of course, the government is known to inflate things to make it look better.  So, probably the powers that be will show some growth for two consecutive quarters sometime before the elections in 2010.  In fact, I would bet on it.

But let me be frank.  What we're seeing right now is only the beginning.  It's going to be ugly, worst since the Great Depression, maybe worse in fact.  We'll see.

Agree except with the caveat that it depends on what approach the government takes.

Bailing out the auto industry = bad.  Massive spending on infrastructure and education = good.    No concern about balancing a budget = good.

Let's see how much the GOP obstructs this, basically, and whether if the GOP obstructs the bad parts that the Dems want (auto bailout) but not the good parts (massive massive more spending).

We'll see.

*note, some things may be generalized

[CARLHAYDEN]

I predicted the recession several months ago when I reminded people that the 2008 election would be one worth losing.

Now, there are a lot of imponderables as to the length/duration of the recession.  I highly doubt that it will end in 2009, and it could extend into 2011.

We were in a souffle economy where the books of many financial organizations were "cooked" to inflate the supposed value to enable executive to extract large bonuses.

Much of the bogus value was the result of the slice and dice (mystery meat) mortgage resale market.

I highly recommend that everyone study the classic "Tulip" bubble to gain a better understanding of what is happening.

[Sam Spade]

Massive spending on infrastructure and education = good.    No concern about balancing a budget = good.

Won't work - you'll see.  I meant to explain why in the other thread you started instead of my silly "yawn", but Torie already posted the why.

Look, U-6 unemployment jumped another 1.3% last month to 12%.  That's the number worth watching, not the government's cooked numbers.  And unemployment is a lagging indicator.  Be prepared - it's going to be ugly.

[Lunar]

Well, what can I say but that I trust Christie Romer, who was my professor last year and is an expert on depressions (as is Bernanke)?  Still waiting for an opinion on that skateboarding, swearing Geithner.  Honestly [well, it's not hard to be honest here] they know a lot more about the economy than you or me.  To me, it's all a matter of how much political considerations hamper doing the right thing, and that's sort of an unknown.

Obama's appointment of Vilsack today certainly isn't encouraging, unlike all of his previous cabinet picks.

[Sam Spade]

Well, what can I say but that I trust Christie Romer, who was my professor last year and is an expert on depressions (as is Bernanke)?  Still waiting for an opinion on that skateboarding, swearing Geithner.  Honestly [well, it's not hard to be honest here] they know a lot more about the economy than you or me.  To me, it's all a matter of how much political considerations hamper doing the right thing, and that's sort of an unknown.

Obama's appointment of Vilsack today certainly isn't encouraging, unlike all of his previous cabinet picks.

They may know a lot and probably have studied a lot of history and economics, but don't think at any times that they're smarter than you are or necessarily are any more correct about the solutions.  Chances are they bought into a lot of the suppositions that led to our current plight.

The best suggestion I can make is to do your own inquiry.  Do some study of economics, behavior patterns, history, etc.  Read up on the specifics of corporations.

I'm no genius on economics (nor do I have a degree, unlike Torie), but I have done enough reading to where I have a halfway decent idea what's going on.

And hey, when I was working down in Houston, every housing deal I ever got my family into turned a sizable profit (25% or above, even after taxes).  Of course, those were during the house bubble days, but the bubble was never very big in Texas housing.  You did have to do some work to get that kind of profit. (ends bragging)

[Sensei]

Q1 2010, I'm thinking

[Swing low, sweet chariot. Comin' for to carry me home.]

I would guess Q3 2009, but no one knows, obviously

I love what the Fed did yesterday. 

[Matt Damon™]

Who says it will? Argentina has never really recovered from Peron.

[opebo]

I think some growth is possible in 2010, but it all depends on government spending.  Without a proper Keynesian response - one that truly puts massive spending power into the hands of the poor/working class - growth will sputter out at just the wrong time (before the 2012 elections). 

The key to fixing this is World War II level spending, but without the silly war excuse - just good economics.  Also we should cut back to a 32 hour work week and double the minimum wage, as well as the obvious imposition of a comfortable dole and free universal health care.

I see no reason that the money for this cannot just be created by printing press.

[J. J.]

My guess is that new economic problems crop up in 18 months.

I'm seeing 1975-82 repeating itself.

[The Populist]

I'd guess probably Q2 of 2009.

[CARLHAYDEN]

My guess is that new economic problems crop up in 18 months.

I'm seeing 1975-82 repeating itself.

Pretty much.

[opebo]

My guess is that new economic problems crop up in 18 months.

I'm seeing 1975-82 repeating itself.

Pretty much.

You nutters, 1976, 1977, and 1978 were all boom years, and better than anything that has gone since:

http://www.data360.org/dsg.aspx?Data_Set_Group_Id=274


Quarter Nominal Real Growth rate annualized
Jan-1975 4.27%  -4.78% 
Apr-1975 9.07%  2.93% 
Jul-1975 14.32%  6.78% 
Oct-1975 12.39%  5.24% 
Jan-1976 13.53%  9.00% 
Apr-1976 7.29%  2.98% 
Jul-1976 7.40%  1.92% 
Oct-1976 10.23%  2.86% 
Jan-1977 11.46%  4.83% 
Apr-1977 13.76%  7.85% 
Jul-1977 12.12%  7.16% 
Oct-1977 8.67%  -0.04% 
Jan-1978 7.27%  1.29% 
Apr-1978 23.37%  15.77% 
Jul-1978 10.65%  3.94% 
Oct-1978 13.83%  5.26% 
 

[Torie]

Opebo, your percentage numbers would have more meaning if they were inflation adjusted. Inflation was alive and well in 1976-1978. Real percentage growth might have been anemic or negative.

[bullmoose88]

Opebo, your percentage numbers would have more meaning if they were inflation adjusted. Inflation was alive and well in 1976-1978. Real percentage growth might have been anemic or negative.

I think he did use real growth, the first percentage is nominal, the second real?  Or is he fooling around with them?

[opebo]

Opebo, your percentage numbers would have more meaning if they were inflation adjusted. Inflation was alive and well in 1976-1978. Real percentage growth might have been anemic or negative.

I think he did use real growth, the first percentage is nominal, the second real?  Or is he fooling around with them?

Absolutely correct, bullmoose.  Sorry, Torie, that my labelling and columns were a bit off, but yes, the first figure is nominal, and the second 'real' GDP growth.  Real GDP growth was quite strong in 76, 77, and 78.  Those were great years for american workers.

[Neinrein]

I think some growth is possible in 2010, but it all depends on government spending.  Without a proper Keynesian response - one that truly puts massive spending power into the hands of the poor/working class - growth will sputter out at just the wrong time (before the 2012 elections). 

The key to fixing this is World War II level spending, but without the silly war excuse - just good economics.  Also we should cut back to a 32 hour work week and double the minimum wage, as well as the obvious imposition of a comfortable dole and free universal health care.

I see no reason that the money for this cannot just be created by printing press.

I agree in theory with Keynesianism, but the problem with what you just suggested, just printing money, is the fact that the country has changed. We don't have the industrial base we did back then and one big difference, we now have a national debt that will soon equal and exceed the yearly GDP. We can print our way out of it numerically but that will lead to inflation. If we produce a bunch of government jobs without manufacturing anything tangible and pay for it with currency production you will have inflation and you could have hyperinflationary. We need jobs, manufacturing jobs, we have to start producing something again or sink and we have to stop caring about all the poor people of the third world because caring about them and shipping them this country's jobs is why we are in this mess

[Torie]

Opebo, your percentage numbers would have more meaning if they were inflation adjusted. Inflation was alive and well in 1976-1978. Real percentage growth might have been anemic or negative.

I think he did use real growth, the first percentage is nominal, the second real?  Or is he fooling around with them?

Absolutely correct, bullmoose.  Sorry, Torie, that my labelling and columns were a bit off, but yes, the first figure is nominal, and the second 'real' GDP growth.  Real GDP growth was quite strong in 76, 77, and 78.  Those were great years for american workers.

My apologies Opebo. I was just having a senior moment - your chart upon review was sufficiently lucid to cause  me to pen  the first bit of this sentence.

[Jacobtm]

Perhaps a crazy expert could tell, but I doubt anyone who thinks they can tell which quarter the economy will start expanding again. 1-3 years seems reasonable, but who knows?

[muon2]

Opebo, your percentage numbers would have more meaning if they were inflation adjusted. Inflation was alive and well in 1976-1978. Real percentage growth might have been anemic or negative.

I think he did use real growth, the first percentage is nominal, the second real?  Or is he fooling around with them?

Absolutely correct, bullmoose.  Sorry, Torie, that my labelling and columns were a bit off, but yes, the first figure is nominal, and the second 'real' GDP growth.  Real GDP growth was quite strong in 76, 77, and 78.  Those were great years for american workers.

My apologies Opebo. I was just having a senior moment - your chart upon review was sufficiently lucid to cause  me to pen  the first bit of this sentence.

I agree that the chart was accurate, but the four year stretch from 1976 through 1979 wasn't quite better than anything since. I used the tables for annual and quarterly real GDP as maintained by the Bureau of Economic Analysis. That stretch had a total growth of 20.00% over four years. The period from 1983 through 1986 had a growth of 20.70%. It is true that no four year period in the 90's beat that. For comparison, Clinton's best years were from 1996 through 1999 and only reached 17.91%.

[○∙◄☻¥tπ[╪AV┼cVê└]

Opebo, your percentage numbers would have more meaning if they were inflation adjusted. Inflation was alive and well in 1976-1978. Real percentage growth might have been anemic or negative.

I think he did use real growth, the first percentage is nominal, the second real?  Or is he fooling around with them?

Absolutely correct, bullmoose.  Sorry, Torie, that my labelling and columns were a bit off, but yes, the first figure is nominal, and the second 'real' GDP growth.  Real GDP growth was quite strong in 76, 77, and 78.  Those were great years for american workers.

My apologies Opebo. I was just having a senior moment - your chart upon review was sufficiently lucid to cause  me to pen  the first bit of this sentence.

I agree that the chart was accurate, but the four year stretch from 1976 through 1979 wasn't quite better than anything since. I used the tables for annual and quarterly real GDP as maintained by the Bureau of Economic Analysis. That stretch had a total growth of 20.00% over four years. The period from 1983 through 1986 had a growth of 20.70%. It is true that no four year period in the 90's beat that. For comparison, Clinton's best years were from 1996 through 1999 and only reached 17.91%.

On the other hand, if you use average annual percentage increase in jobs by President as your barometer,  then for the last 85 years every Democratic President beats every Republican President. The worst 3 are Hoover, Bush 43, and Bush 41.