http://www.nber.org/...
These guys say they could come up with and utilize any combination of factors and weights that they wish.
Business Cycle Dating Committee, National Bureau of Economic Research
CAMBRIDGE September 20, 2010 - The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday by conference call. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months.
Fantastic! The multi-millions of jobless and near jobless can now relax.
A recession is a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.
Okay - where are the breakdown and sources for these individual factors that indicate an "end" to the recession?
So far - nothing. But let's see...
The trough marks the end of the declining phase and the start of the rising phase of the business cycle.
What specifically is rising? Why does this "business cycle" exist, especially now in these extraordinary, unprecedented times?
The committee waited to make its decision until revisions in the National Income and Product Accounts, released on July 30 and August 27, 2010, clarified the 2009 time path of the two broadest measures of economic activity, real Gross Domestic Product (real GDP)
If 80% of real GDP, consists now, say, of 400 super-wealthy families, then things are looking up!
...and real Gross Domestic Income (real GDI).
Which is similar to GDP. See GDP above.
But other indicators are included:
...the payroll and household measures of total employment (and) aggregate hours of work in the total economy (and) household survey employment.
So jobs are included in three different factors in their assessment. But it's a "jobless" recovery, according to the NYT (see below).
There is no fixed rule about what weights the committee assigns to the various indicators, or about what other measures contribute information to the process.
So consistency is not necessary. So how do we see a recovery if there is no consistent standard for comparison in the first place?
The current members of the Business Cycle Dating Committee are:
Robert Hall, Stanford University (chair);
Martin Feldstein, Harvard University;
Jeffrey Frankel, Harvard University;
Robert Gordon, Northwestern University;
James Poterba, MIT and NBER President;
James Stock, Harvard University; and
Mark Watson, Princeton University.
So Bob, Marty, Jeff, Bob, Jim, Jim and Mark decided on all this in one conference call.
Any public comment or input? Of course not.
Any idea on exactly what factors were used and what weights were assigned to each factor? Nope.
Would it matter anyway? Ahhhh..Nope - because, as shown above, any combination of factors and weights can be used at any given time.
The New York Times:
http://economix.blogs.nytimes.com/...
This lag has led many to refer to the current situation as a "jobless recovery," and had even prompted suggestions that the weak job market should play a bigger role in determining recession start and end dates.
So:
...the payroll and household measures of total employment (and) aggregate hours of work in the total economy (and) household survey employment.
...were, I assume, plus factors in the calculation and assessment.
But it's still a...
"jobless recovery,"
I see.
This whole bullshit exercise would have made more sense if Penn and Teller were in on the conference call.
But what is REALLY happening out there?
http://en.wikipedia.org/...
A depression is characterized by its length, and by abnormally large increases in unemployment, falls in the availability of credit—quite often due to some kind of banking/financial crisis...numerous bankruptcies—including sovereign debt defaults...financial crises and bank failures are also common elements of a depression.
You be the judge.