(Un)Officially in a recession.

in us •  2 years ago 

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Look at it this way. The two negative GDP quarters notion wouldn't have called 2001 and 2020 recessions, but they clearly were given the underlying comprehensive economic data.

It also wouldn't have called 2008 a recession initially. 2008 Q1 GDP was initially estimated as positive. Revisions would later show it was actually negative and that 2008's contraction was significantly more severe than initially thought. The NBER's Business Cycle Dating Committee (the official arbiter of a recession) would determine the recession actually began as early as December 2007. If we went by the two consecutive quarters rule the recession wouldn't be until Q3 2008.

The opposite situation might be going on now. It is entirely possible Q1 or Q2 GDP get revised upward when the annual and benchmark revisions are released in the future. This may very well be the case given that Gross Domestic Income was positive for Q1. Or it could very well be that the BCDC determines Q1/Q2 were not a recession despite negative GDP. It would be a very odd recession with employment this strong.

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