In the NYT Economix blog,
David Leonhardt asks economists whether we're in a recession. Robert Gordon says we are, but
“I would be surprised if most people on the committee didn’t agree we are in a recession,” he said. “But we certainly don’t have a consensus.” The committee is likely to wait until after it receives more data on the third quarter, which ended on Sept. 30, before making any decisions.
The NBER looks at four variables to determine if we're in a recession: employment, industrial production, real manufacturing and trade sales, and real personal income less transfers. They have nice pleasant graphs in their
November 2001 press release that called the business cycle peak in March 2001. In that release, employment is shown to peak in March 2001, industrial production and manufacturing and trade sales around September 2000, and income not at all.
What does the last two years' data look like? Take a look:
'
I see a peak in employment in December 2007, industrial production in January 2008, manufacturing and trade sales in October 2007, and personal income in September 2007. The data look pretty clear to me: I'm saying December 2007 was a business cycle peak; we've been in a recession lo these past 10 months.
Note: waiting for those third quarter GDP figures? My sources say GDP growth will be minus 3 percent. That's a huge drop!
