Why is this a recession and not a depression?

[Thunder]

http://news.yahoo.com/s/ap/20090302/ap_on_bi_ge/the_d_word

Whatever this is...it sucks.

[gumboot]

http://news.yahoo.com/s/ap/20090302/ap_on_bi_ge/the_d_word

Whatever this is...it sucks.


Don't give the media any ideas. They've made things bad enough without starting to throw around "depression".

[Texas]

http://news.yahoo.com/s/ap/20090302/ap_on_bi_ge/the_d_word

Whatever this is...it sucks.When we reach these conditions:

http://useconomy.about.com/od/grossdomesticproduct/f/Depression.htm


During the Depression, unemployment was 25% and wages (for those who still had jobs) fell 42%. Total U.S. economic output fell from $103 to $55 billion and world trade plummeted 65% as measured in dollars.
The Depression was aggravated by poor monetary policy. Instead of pumping money into the economy, and increasing the money supply, the Fed allowed the money supply to fall 30%. The "New Deal" created many government programs to end the Depression, but government programs alone could not end it. Unemployment remained in the double-digits until 1941, when the U.S. entry into World War II created defense-related jobs.

[Springfork]

When your neighbor is out of work, it's a recession. When you're out of work, it's a depression.

[chefpeon]

Don't give the media any ideas. They've made things bad enough without starting to throw around "depression".

That's the general jist of what I was going to say. I think what feeds the fire is the media, whom I believe, while serving the public, also do not serve the public. All day I hear "hard times" "bad economy" "tough econonomy" etc. It's in the paper, the radio, the TV news. All day we are reminded of it, and then they make the announcements that the stock markets are not doing well because consumer confidence is down. Well.........duh!

I appreciate the media reporting the news, but how about concentrating on the news, instead of re-stating the obvious day after day?

It's like listening to traffic reports.....what's the point? Traffic sucked yesterday and it sucks today.....maybe a little more, maybe a little less, but it still sucks.....otherwise there'd be no traffic report!

How about if the media agrees to agree that the economy sucks, and they'll report again when things start looking up? Perhaps if the "hard times" aren't rammed down our throats every day.....a little consumer confidence just might go up.........

[Thunder]

Perhaps if the "hard times" aren't rammed down our throats every day.....a little consumer confidence just might go up.........

good point. we feed off the media..and the media feeds off us.

[gumboot]

That's the general jist of what I was going to say. I think what feeds the fire is the media, whom I believe, while serving the public, also do not serve the public. All day I hear "hard times" "bad economy" "tough econonomy" etc. It's in the paper, the radio, the TV news. All day we are reminded of it, and then they make the announcements that the stock markets are not doing well because consumer confidence is down. Well.........duh!


Our media report every tiny little snippet of bad economic news with glee. To read the media you'd think that the end times were upon us.

But in my country, Treasury projects that as a worst case scenario, unemployment will hit 7.5%. It's currently at 5%. That's not really that bad.

I see reports and they're things like "worst in 6 years", "dollar is weakest in five years". Again, that's not that bad.

When unemployment's at 20% and they're reporting "lowest in 60 years" then their doomsday reporting might be justified.

At the moment all their scaremongering is going to do is make that nightmare come true. It's not like anyone in the media is actually offering solutions and when someone else does offer a solution the media can't be quick enough to show how it's not going to work.

I think traitors have lost their place in the 9th Circle of Hell. That's reserved for journalists now.

[Puppycow]

When we reach these conditions:

http://useconomy.about.com/od/grossdomesticproduct/f/Depression.htm

That was The Great Depression. A small 'd' depression is by one definition (http://economics.about.com/cs/businesscycles/a/depressions_2.htm)an economic contraction greater than 10%. The economy shrank by 6.2% in Q4, so if it shrinks by another 3.8% it would fall under that definition of depression. So it looks like a pretty good bet that this downturn will meet that definition. This would still be not nearly as bad as The Great Depression, but it would be a depression.

[Thunder]

Yeah, I predict a mini-Depression. Or a Depression-lite.

Diet Depression?

:)

[Texas]

That was The Great Depression. A small 'd' depression is by one definition (http://economics.about.com/cs/businesscycles/a/depressions_2.htm)an economic contraction greater than 10%. The economy shrank by 6.2% in Q4, so if it shrinks by another 3.8% it would fall under that definition of depression. So it looks like a pretty good bet that this downturn will meet that definition. This would still be not nearly as bad as The Great Depression, but it would be a depression.That was just for the quarter. You have to average all 4 quarters for the year to get the actual GDP. Real GDP in 2008 actualy increased 1.1% year over year:

http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

2008 GDP
Real GDP increased 1.1 percent in 2008 (that is, from the 2007 annual level to the 2008 annual
level), compared with an increase of 2.0 percent in 2007
<snip>
During 2008 (that is, measured from the fourth quarter of 2007 to the fourth quarter 2008), real
GDP decreased 0.8 percent. Real GDP increased 2.3 percent during 2007. The price index for gross
domestic purchases increased 2.0 percent during 2008, compared with an increase of 3.3 percent during
2007.



.

[Meadmaker]

Maybe we could call it a "panic". It has such a quaint, 19th century sound to it.

[dudalb]

We will know it is a Depression when "Brother ,Can You Spare Me A Dime" becomes a huge hit again.

[Thunder]

How about "The Great 21st Century Flippity-Flop"?

[gumboot]

Maybe we could call it a "panic". It has such a quaint, 19th century sound to it.

Retro is in.