0.6% GDP Growth is Cheered
Mike Hashimoto, in The Dallas Morning News Opinion blog, greeted the news that the GDP grew at an annualized rate of 0.6% last quarter as good news. You see, as long as it's above zero, it means we're technically not in a recession. He brings all the expertise of a hockey fan to his economic analysis. As long as we're not negative, we must be winning. And a one-goal win counts as much as a five-goal win.
Whether or not we're in a recession depends on the definition and who's doing the measurements. The classic definition is two quarters of declining GDP. By that definition, the quarter ending in March, with 0.6% GDP growth, was not part of a recession. Others point out that the population is growing at faster than a 0.6% rate. GDP growth below population growth means the per capita economy is slipping.
The government relies on the National Bureau of Economic Research for its "official" call. The NBER defines recession as a "significant decline in economic activity spread across the economy, lasting more than a few months." They haven't made the call yet, but many experts believe when the NBER does finish crunching the numbers, they'll call this a recession.
The Cheerleader in Chief calls the current economy a "tough economic period." Yikes. Mike Hashimoto doesn't even have George W Bush pretending the economy ain't all that bad. Mike Hashimoto describes four consecutive months of job losses and 20,000 more jobs lost last month as "not so bad." I expect more than a few readers will have that reaction when Belo passes out that pink slip to Mike Hashimoto.
2 comments:
Examining everything that the NBER indicate show “normally visible” and “significant” decline during a recession, it is increasingly unlikely that we are currently in a recession:
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The Recession of 2008 That Wasn’t?
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Time will tell. Thanks for the link.
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