If you’ve had your TV or radio on anytime in the last year or so or even if you just get your daily dose of news from the tubes of the internet, you’ve probably heard the word “recession” mentioned a few times, right? Well, bad news for the liberal media and left-wing nut job politicians, but we are not in a recession according the the numbers released yesterday. Check out the story on Breitbart if you don’t believe me:
The country’s economic growth during January through March was the same as in the final three months of last year, the Commerce Department reported Wednesday. The statistic did not meet what economists consider the classic definition of a recession, which is a retraction of the economy. This means that although the economy is stuck in a rut, it is still managing to grow, even if modestly.
I’ve had this argument with more than one person in the last month or two, the most fun of which was with my employer’s VP of Sales who didn’t seem to believe me at all. You can bet I’ll email him this article later today.
What we’re going through right will probably never meet the “classic definition of a recession,” but there is definitely something wrong with our economy. It doesn’t help that the Fed won’t let the bubble burst and let things normalize a bit — instead they pump bazillions of dollars of money into the economy by printing more of it. Wall Street people are getting rich, meanwhile the dollars in my pocket are slowly becoming worthless. This may not be a “recession,” but our economy is indeed going down the crapper.
I just realized I’ve commented twice now on your blog, and both times I sounded like a complete jerk. Please don’t take anything I say seriously. I’m a complete idiot, and in fact, I’m not usually a troll on blogs like I have been on yours.
Have a nice day!
Justin,
Don’t forget that in the last 10 years the government has redefined their standards they use to measure the “recession” definition. Unfortunately, it’s extremely hard to get a clear picture, because they’ve changed the definition so drastically in the past few years. According to some independent researchers, we are in a recession, and according to others, we’re not. Still other’s say we are close. My point: the government has been manipulating the data, and the truth about it evades us (because it seems that everyone is warping it).
Shawn
Tim – no sweat. Make sure your next comment is constructive! I make no claims that our economy is booming – but the reality is, its not as bad the folks over at CNN Money would have you believe if that was your only source of information (like it is for a large portion of America).
Shawn – I believe the data is publicly available, no? So if our “evil” government has changed it’s definition (do you have a source for that fact? I’d be curious to read up on it actually), someone can independently draw their own conclusions.
The data is publicly available — we aren’t in a recession (yet anyway). Our government can’t “manipulate” the data, that’s just absurd conspiracy theory. You can’t “manipulate” data; it’s either the observed data or made up facts, think about it. What you “manipulate” is the interpretation or the formulas that use the data. That’s why “some analysts” say “x” and “other analysts” say “y” — they are all using the same data, they are just “manipulating” the data in different ways. This isn’t even necessarily a bad thing. One group might think one variable deserves more weight than another.
Even if the economy isn’t chugging along at 100%, there have been (I think) 11 recessions since 1945, each lasting about 10 months (again, I think; if you’re interested, you look it up). Unless you are going to live under a statist government, such as communism or marxism, you’re being unreasonable to think that recessions shouldn’t exist.
Of course, that doesn’t make it easier on anyone who is impacted by it, but it is a fact a life. Until I see soup lines rounding corners, though, I don’t think I’ll worry too much.
I would like to comment on what Tim said, too. I agree with him about the printing of more money and the inflation that is going to occur because of it. It infuriates me, too, that our government would bail out banks because they made the decisions they did. Doing so only sets precedent in the future for banks to say “well, we know it’s incredibly risky, but the American taxpayer will bail us out if it goes bad.”
HOWEVER, you can’t let a wholesale collapse of the economy happen either. $15 billion is a drop in the well compared to the $19 trillion economy that might conceivably “collapse” should banks start to fail one after another. If banks didn’t have their cash flow all of a sudden from the housing bubble collapse, then one bank fails (Bear), then people get spooked and start taking their money out of their banks… well… where is it coming from? No cash flow = no money for you. I don’t know just how possible this alternative is/was, but it doesn’t seem worth the risk.