Recession started December 07

insane man · Dec 1, 2008

The U.S. entered a recession in December 2007, according to the National Bureau of Economic Research.Get Breaking News by e-mail

cnn.com

Breaking News 12:32 PM ET:
It’s Official: U.S. Economy in Recession

nyt.com

Major · Dec 1, 2008

I don't understand how that works. The definition of a recession is 2 consecutive quarters of negative economic growth, no? We had positive growth in Q4 2007, Q1 2008, and Q2 2008. Q3 2008 was the first negative growth, and I assume Q4 will be the same. Wouldn't that mean we entered the recession in Q3 2008, or at the earliest, sometime in the middle of Q2?

insane man · Dec 1, 2008

Major said:

I don't understand how that works. The definition of a recession is 2 consecutive quarters of negative economic growth, no? We had positive growth in Q4 2007, Q1 2008, and Q2 2008. Q3 2008 was the first negative growth, and I assume Q4 will be the same. Wouldn't that mean we entered the recession in Q3 2008, or at the earliest, sometime in the middle of Q2?
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Although a recession is conventionally defined as two quarters of successive contraction in gross domestic product, the private committee doesn’t require supporting GDP data to make a recession call. Its members focus on month-to-month changes in the economy.

The U.S. economy shrank at a 0.5 percent pace in the third quarter after expanding 2.8 percent in the previous three months. Economists at Goldman Sachs group Inc. and Morgan Stanley in New York are among those projecting the economy will contract at a 5 percent pace this quarter.
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bloomberg

also here is their press release/paper on this.

rimrocker · Dec 1, 2008

Uh, duh.

Lil Pun · Dec 1, 2008

Tell us something we didn't know.

SamFisher · Dec 1, 2008

Major said:

I don't understand how that works. The definition of a recession is 2 consecutive quarters of negative economic growth, no? We had positive growth in Q4 2007, Q1 2008, and Q2 2008. Q3 2008 was the first negative growth, and I assume Q4 will be the same. Wouldn't that mean we entered the recession in Q3 2008, or at the earliest, sometime in the middle of Q2?
Click to expand...

maybe they are counting from the beginning of the shrinkage. Also I wouldn't discount the possiblity of them using downwardly revised GDP figures.

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Recession started December 07

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