Monday, May 19, 2008

Recession call at ivory tower pace

BusinessWeek reports "Why So Long to Call a Recession?"

Any call, if it comes, is going to take a while. The NBER usually takes 6 to 18 months to decide when a recession starts or ends. Hall's committee didn't announce the end of the 2001 recession until a full 20 months after the fact.


Robert Hall, Chairman of Business Cycle Dating Committee

Hall says he's a hands-off manager of the process of identifying recessions. "These aren't people who can be directed," says Hall of the committee members. "These are people with a lot of expertise and awareness of what's happened in the past, but it's not a group that has a lot of disagreement." Discussion takes place by e-mail and frequently revolves around a mid-month message Hall sends to committee members containing economic data, including the monthly estimate of GDP growth, as calculated by the St. Louis consulting firm Macroeconomic Advisers.  


sbvor said...


My post continues to evolve:
The Recession of 2008 That Wasn’t?

I propose a three pronged gentleman’s bet:

1) The final GDP figure for Q1 will remain positive (I’m betting between 0.4% and 0.6%). We’ll know on June 26th.

2) The NBER never declares a recession to have taken place at any point in 2008.

3) The economic forecast from The Conference Board proves to be accurate within plus or minus 0.3% for each remaining quarter of 2008.

Note: As of today, 5/20/08, the predictions are:
Q2: +0.4%
Q3: +1.4%
Q4: +1.5%

(Meaning, no recession in 2008.)