The Recession Is Over, Right?
Bruce Bartlett is “astounded” that some financial journalists are taking the fact that the National Bureau of Economic Research hasn’t told us when the recession ended as an indication maybe the recession hasn’t actually ended.
No, Bartlett explains, he is “100% certain that every member of the Business Cycle Dating Committee knows perfectly well that the recession ended some time ago.” The only question is the precise date. “The committee’s problem is that many key indicators of economic activity, such as real GDP, are revised so often and to such a large extent that economic history is continually being rewritten.” So, it’ll take awhile to nail it down.
Kevin Drum points out that we shouldn’t be surprised, given NBER’s track record:
- The November 2001 trough was announced July 17, 2003.
- The March 1991 trough was announced December 22, 1992.
- The November 1982 trough was announced July 8, 1983.
- The July 1980 trough was announced July 8, 1981.
While aggravating for junkies, NBER has no incentive to be fast, just accurate. And, as Bartlett himself points out later in the piece, Further, “the NBER is entrusted to call the dates of business cycles precisely because there are political implications to it. That’s why the Bureau of Economic Analysis doesn’t determine when a recession has begun or ended. But of course private economists–or even the Council of Economic Advisers–are perfectly free to express an opinion on the subject.”