Login | Create New Account | Facebook | Twitter
Homes | Jobs | Wheels | Worship | IShopTheTri | Move To Kingsport | Kingsport Chamber of Commerce
Print
The recession may be officially over, but recovery is fragile and job losses still mounting
WASHINGTON (AP) -- It's about to become official: The recession is over - but not the pain.
The government will release figures this week expected to show that the economy has awakened from its deepest slump since the 1930s and is in the early stages of a recovery. But the following week, the government will issue another set of figures expected to show unemployment continuing to rise toward and possibly above a clearly recessionary 10 percent.
How can both be possible?
The government releases third-quarter Gross Domestic Product figures on Thursday. Many forecasters say they will show GDP growing at an annual rate of about 3 percent, validating a widely held belief among economists that the recession ended in June or July.
But try telling that to the more than 15 million still unemployed, the small businesses and individuals who can't get loans and the people whose homes are worth less than their mortgages.
Assertions by government and private economists that the recession is over - issued amid graphic examples of continuing wide distress - are raising fresh questions about economic scorekeeping.
The national recession may be technically over, but the state of the economy remains in the eyes of the beholder.
Or, as Ronald Reagan liked to say, a recession is when your neighbor loses his or her job. Depression is when you lose yours.
A survey of economic forecasters prepared by Blue Chip Economic Indicators, a research organization, predicted GDP growth to remain positive in each quarter through the end of 2010. In a survey by the National Association of Business Economics, 34 of 43 economists polled said the recession is over.
"From a technical perspective, the recession is very likely over," said Federal Reserve Chairman Ben Bernanke.
"A recession that showed no signs of ending last January appears to be firmly entering the recovery phase," said Christina Romer, the chair of the White House Council of Economic Advisers.
But nobody is sugar coating the statistics, especially in the administration, which agrees with private surveys suggesting that unemployment will hover near 10 percent through most of next year.
"Even when you've turned the corner, you have so much work to do," Romer told Congress' Joint Economics Committee.
And while she credited much of the turnabout to government stimulus measures and moves by the Fed, she said "by mid-2010, fiscal stimulus will be contributing little to further growth."
The economy has lost 7.2 million jobs since the recession began in December 2007, 3.4 million of them since President Barack Obama took office in January.
James K. Galbraith, an economist at the University of Texas at Austin, suggests too much attention is given to when recessions technically begin and not enough to other measures of the economy.
"It's just a word. A recession technically lasts during negative quarters. But that doesn't mean you're back to prosperity once you have positive growth. You're back to prosperity when the unemployment rate is back around 4 percent," Galbraith said. And that, he said, could take years.
A recession is popularly defined as two or more consecutive quarters of negative economic growth, or declining output.
But a more refined determination is made by the National Bureau of Economic Research, a private group of leading economists charged with dating the start and end of economic downturns. It not only looks at GDP but at employment levels, real personal income, industrial production and wholesale and retail sales.
It put the start date at December 2007 and has not yet called an end.
There have been 11 recessions since World War II. In the two most recent ones, job growth lagged long after the recessions were deemed over. In the most recent two - July 1990-March 1991 and March-November 2001 - the unemployment rate did not fall to prerecession levels for several years.
After the eight-month 2001 recession, the unemployment rate went from a prerecession 4 percent in 2000 to 4.8 percent in 2001. Then it kept climbing even higher - to 5.8 percent in 2002 to 6 percent in 2003. It didn't return to under 5 percent until 2006, when it fell to 4.6 percent.
While there are clear signs of recovery, it is uneven.
Stocks have surged about 50 percent since their March lows. And a year after Washington rescued the financial industry, some large banks and Wall Street firms have roared back to profitability.
But smaller banks and other businesses are struggling, and many have failed or are failing.
That disconnect sparked anger among the public and led to sweeping government action last week to limit executive compensation at financial firms that accepted federal bailout money.
"While credit may be more available for large businesses, too many small business owners are still struggling to get the credit they need," Obama said in his weekly radio and Internet address. "These are the very taxpayers who stood by America's banks in a crisis - and now it's time for our banks to stand by creditworthy small businesses, and make the loans they need to open their doors, grow their operations and create new jobs."
There have been modest improvements in manufacturing and other parts of the nonfinancial business sector, yet lingering signs of weakness in commercial real estate and retail spending.
Economists suggest some of the expected increase in economic growth is a bounce off the bottom. They attribute it to government stimulus spending, including the now-expired Cash for Clunkers program; accommodative Fed monetary policies and widespread cost-cutting by companies.
Many companies let inventories run down so much that when they ran out, orders picked up. Home resales ticked up as buyers scrambled to complete their purchases before a tax credit for first-time owners expires. And U.S. exporters have benefited from a relentless decline of the dollar that has made U.S. goods cheaper and more competitive overseas.
But none of this adds up to a sustainable upswing.
"Absent robust job growth, it is not a true economic recovery," said White House economic adviser Jared Bernstein.
To comment, you must register.
Comments are the sole responsibility of the registered user participating in online discussions. You agree not to post comments off topic, abusive, obscene, defamatory, vulgar, threatening or an invasion of privacy. Violators may be banned.
Most Popular News
Today | Week | Month | Year
- No top stories for the day.
Most Popular News
Today | Week | Month | Year
Featured Blogger
Militia Muster This Saturday and Sunday.
By Ned Jilton - 11-20-2009
I know that this week-end will be busy for many folks what with the Santa Train, Christmas Parades in the area and high school football play-offs in s...
Most Discussed
Today | Week | Month | Year
- Kingsport nurse accused of stealing credit cards from elderly patient's daughter
- Coach’s comments repulsive
- Kingsport police going paperless with PDAs
- Machete bandit robs same Kingsport Sunoco station for second time
- Judge strikes down Tennessee guns-in-bars law
- Tenn. comptroller: Health care reform bills potential ‘disaster’ for states
Most Discussed
Today | Week | Month | Year
topjobs
Browse Premiere Local Businesses
Home | Login | Local News | Obits | Sports | Business | Opinions | Blogs | Classifieds| Business Profiles
Web Feeds/RSS | Contact Us | Customer Service | Privacy Statement | Common Questions | E-Edition | Subscriptions | Site Map
© 2009 Kingsport Publishing Corporation - Innovation by Times Digital Group
Jay: You overlooked Ron Paul?
I also share a political viewpoint that probably cannot exist, in the current state of affairs. When you have the usual anti-war party (the Democrats) in charge, you would think the troops were coming home soon. In fact- they're there for the long haul- destined to hemorrhage blood and money into the soils of Afghanistan to what is essentially, a draw.
Billions spent, families wrecked, and thousands of Afghanis dead... and it's basically a draw. Afghanistan isn't called the "graveyard of empires" for no reason...
My candidate would have brought home troops like there was no tomorrow.
With our current slate of candidates- they're basically both sides of the same coin. We just happened to get the spend-happy uber-narcissist on the coin flip last November.
We wouldn't have fared much better with Mr. Perpetual War McCain. The Recession would still be ambling along, and the Gov't would see itself as the Savior of the economic well-being of the nation.
To hell with both of the parties, and their legion myrmidons. It's a crying shame that they're dragging our nation with them.
I think I explained it pretty well. I am for whomever will wake up every morning and go to work. I couldn't tell you who would be a good candidate. They are all to busy making you promises that they can't back up just to get a job. What we need is a government that wants to lead, A government that cares about it's people. I am afraid that is just a pipe dream. Mr. Clinton started the housing crisis, Signed the NAFTA bill and started the beginning of selling our country off to the Chinese. Yeah he had a surplus but he started the banks on there financing frenzy with the housing market which in turn created the biggest market downturn we have seen in 4 decades.
Mr. Bush I didn't really have any major policy issues with, He was pretty much deadlocked from the get go and never really accomplished anything but his wars. It would have been nice if he would have reversed the easy street financing and left wall streets regulations alone. I think it is a real shame that not only Mr. Bush but a large portion of the country forgot what we were doing there. We never tracked down that man that murdered all of our fellow citizens and that is a real failure in American History and an insult to everyone that died that day. Not only did we give up on tracking that man down, We quit caring what he did. Where have all the flags gone. Gone from the cars, Gone from the homes and the business'. Then We took off and started another war in a whole other country for no good reason what so ever. I Blame Bush for that failure.
Then comes Obama with all of his change. His spending will be the end all. How can you stand around and let the country go broke, While you preach a healthcare bill that I will guarantee you will only add to the demise of America's Finances.
I don't know who but My President will wrangle congress into control. He will raise taxes because that's what we have to do as a country. He would be more concerned about our National deficit than the Olympics. Although he would raise taxes he would initiate a flat tax to make it fair for all. He will raise interest rates to help prop up the American dollar. When oil is 40 bucks a barrel he would find every empty place in the country to store it and then he would start building refineries and drilling on our own land. He would regulate the hell out of Welfare and make it known that you have to go get it in this country it will not be handed to you. The lobbyists, and all the special interest groups would be made to understand we have to do what is for the well being of our country not these people's feelings.
He probably wouldn't be liked by many, That is except by law abiding citizens that want to work for what they have.
This country has gotten weak. Quite honestly we are a country full of Lazy, shameless people who have a self entitlement mentality and until someone comes in a changes our direction as a whole we are screwed.
Think about it. One should never, Never be able to buy a house without a down payment. Go back 20 years, If you didn't have a down payment it wasn't happening,. Same thing with credit cards 20 years ago credit card's were a luxury item, now the average American has a $10,000.00 balance.
These Presidents certainly are not the only ones to blame. Every single person in this country is. All we have to do is look in the mirror. At the same time when these President's come in and make these promises of change and then blatantly ignore those promises and then people go out and put these guys up on a pedestal simply because they are a Democrat or a Republican or whatnot thats is an insult.
I honestly had hoped Obama was the real deal. I wasn't particularly impressed with either of the candidates. Personally I liked Huckabee. If that makes me a Republican fine you can label me whatever you like, He just seemed like a straight shooter to me.
My world will never exist, America could never handle my candidate. America is to weak to handle my candidate, But for the sake of my children and every other child out there I hope someone comes along soon that makes real change. This President has officially sold our children's futures. I just hope someone can change that soon. It might even be him but I don't see how.
Mr. Johansen, You've listed those you are against (anti, anti, anti). I can't help but wonder who you are for, then? What candidate, if any, would you support? I truly want to know who you find worthy? Or would you simply propose that we have no government?
A jobless recovery spells big time trouble for Democrats in 2010. Oh by the way how many jobs did that $850 billion "so called" stimulus plan buy? They way I calculate it, it cost U.S. taxpayers about $1 million per job. Quite a bargain huh? I would laugh if it wasn't so pathetic.
Ha! I like the Reagan quote. He always was a big joker. After he was shot, he said to the medical crew, "I hope you guys are Republicans." That's too funny.
Typo = two massive planes > not to
LOLOLOL, You can't be serious, This is seriously your idea of a defense for spending 2.7 million of the taxpayers dollars to take to massive planes to go fight for an Olympics. That really in the true light of things is the last thing we should be thinking about. They could have rented two G5's from Marquee for 100,000.00 or better yet They should have stayed home. That would have been 2.7 million not added to the deficit.
Just keep on thinking he's the savior of this country, I'll save you a place in the soup line. I am anti Obama, and anti Bush, and anti Clinton, Anyone that thinks these cat's are actually doing good for the country or care about your life are living in LALA land.
I have not seen any death threats against Obama, when, where?About that D from FL. that's what I would expect from a congressman. He will do nothing for you unless it's for money or vote.
If you had as many death threats each day as our President and his family (many thanks to Fox "news" hate rhetoric), then I bet you and your wife would take separate planes also just so that your daughter wouldn't be an orphan if things went wrong.
Rudy Gulliani's wife bought an extra first class seat just for her designer bag.
I see a trickle now, where 3 months ago there was only a drip. It's a LITTLE better.
People are to worried about being a Democrat or a Republican -- How about being an American
I'm not blaming Obama for anything other than his priorities are way of. And his campaign of change was nothing more than a campaign of lies, which by this time we should know that's all campaigns are. Bottom line is Clinton, Bush, and now Obama are driving this country into a collision course with bankruptcy. I want a President that wakes up to go to work, Not one that tell's the banks every American should have a home and your going to do it for them like Clinton did, or a President that starts a war in Iraq to get some for his daddy as Bush did, or a President that Spends more money than any of the other two did in 8 years in 8 months, The two seperate planes for he and his wife to go fight for the olympics officially did it for me. Mr. Obama is no better than the other two and has the potential to be worse. I could care less about what so called pathetic joke of a party you are from. I need a government that is going to give my daughter a country to live in. I can teach her how to go out and pay for her own health care, How about we deal with that after we put a road block on the this road to nationwide bankruptcy. Get over defending this guy, Look at what your government has done to your country not only in the last 16 years but the current one as well.
Florida Congressman, Alan Grayson-D, said it best when he said,
America understands that the republicans are party of "No!". "In fact they understand that if Barack Obama were somehow able to end world hunger, the republicans would blame him for overpopulation.
They understand that if Barack Obama were to bring about world peace, they'd blame him for destroying the defense industry.
In fact, they understand that if Barack Obama has a BLT sandwich for lunch, they will somehow try to ban bacon."
Sadly, he's exactly right.
The last two President's certainly put us here. This government will not get us out. Mr. Obama is to worried about putting his namesake on a healthcare bill. In the background the country is going Bankrupt and this government is doing nothing but spending more money. Cut the Waste, Raise interest rates to get the dollar back up, Control oil costs. Stop spending and start working.
The recession may be over for all those that Uncle Sam gave the Welfare to, Oh wait no sorry that was Stimulus. The rest of us are still in a Depression, I would love to see a recession this is worse. Our business has been down more than 40% for that last 8 months and this month will be close to 60% down. That is not the end of a recession in my book that is the road to a Depression. 2010 and 2012 can't get here fast enough. This governments ideals are hurting more than helping.
The recession is over as much as my ability to breathe is over. Who do they think they're kidding?