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US Has Been In Recession Since December 2007
The National Bureau of Economic Research said Monday that the US has been in a recession since December 2007. The NBER is a private, nonprofit research organization of academic economists who determine business cycles. The stock market took a dip on the news that reached double-digit percentages for some tech stocks.
A long-standing rule of thumb for "recession" is that it is defined as contraction in the GDP for at least two consecutive quarters (six months).
More info.
By that long-accepted definition of recession, the US is not even yet in a recession. The US GDP decreased for the first time in recent history only in the third (most recent) quarter, by 0.3%. In the second quarter -- earlier this year -- real GDP increased 2.8%.
But how long has the media been ceaselessly hammering it into our heads that we're in a recession, tolling the bells of doom and gloom? How many times have we heard the phrase, "In these tough economic times" inserted into nearly everything we see or hear? How long has the drumbeat of the "recession" been played, when we had nothing but positive growth reports, even in the midst of the sub-prime crisis?
Worse still, many people actually believe that whatever recession we'll end up having is exclusively the fault of only the current President, and can't look back to anything before the year 2000 for any blame whatsoever. The egregious irresponsibility of the sub-prime lending has a long and sordid history.
It is this kind of partisan willful ignorance on the part of many that has enabled the political agenda among some to drive the notion that the US is in a severe recession caused by the ineptness and reckless irresponsibility of the Bush administration, when the US had nothing but growth in the GDP until only a month ago. If you asked most people how long they thought the economy had been shrinking for negative, they'd probably say things like, "A year? Two years?"
Wrong.
Last quarter. And we just found out about it.
So we've heard talk, day after day, night after night, an incessant drilling into our heads that we're in a deep and severe recession -- one that may even now rival the Great Depression! -- creating panic and fear, causing people to pull investments and hold onto their wallets, change purchasing plans, in turn creating bleak forecasts for manufacturers and other business, which causes job loss, and then -- voilà!:
Is it any surprise we're going to have a recession on our hands?
Capitalistic systems only work when the participants have faith in the system -- when that faith collapses, for whatever reason, you get a recession. And that's a normal and accepted part of the cycle.
Gold only has the value that other people think it has.
While that is true, the real argument for the gold standard is its fairly constant and predictably increasing supply. All the gold that will ever exist on earth is already here, and we find a little more every year. The main difference is that the government can't just make more gold when politically expedient, like they can with paper money. However, that's also its largest negative according to most economists. The current bailouts would be impossible with gold coins.
... and that's when the C.H.U.D.'s came at me.
A recession is two consecutive negative growth quarters in terms of GDP.
Let me just quote wikipedia for you here.
A recession is a contraction phase of the business cycle, or "a period of reduced economic activity....Some business & investment glossaries add to the general definition a rule of thumb that recessions are often indicated by two consecutive quarters of negative growth (or contraction) of gross domestic product (GDP)
You know what a rule of thumb is right? It's not a law handed down by God, but a rough guide. This is economics, not science. Even if you were to abide strictly by the 2 quarters definition, I bet you couldn't give me a reason why it's 2 quarters and not 3 or 1.
I came here for a good argument
Yeah, there is a real meaning behind "Christmas": the entire population of the temperate Northern Hemisphere deluding themselves into thinking that cold and lack of daylight are somehow jolly!
In case nobody's told you, your savior was born in April or May.
Christmas is the day of the Mass of Christ, not Jesus's birthday. The Catholic Church chose the day to coincide with an existing holy period in pagan Europe, since people were already in the habit of celebrating that week. Nobody knows (or particularly cares) what the exact date was. Christian scriptures only hint at the year by recording stuff like who was king at the time.
Information wants to be anthropomorphized.
If the dollar was backed by gold, we would not NEED "faith" in America or the American economy.
Right. The value of the dollar would then be backed by the limited and fairly stable supply of gold. They're not making any more of it. And that would work fine if the economy was a static and unchanging system. Price levels would remain constant.
But, the economy is not static or unchanging. New products are constantly coming to market, increasing our standard of living, and generally making life more pleasant and productive. Each year there are more and more new products. Just look at the average kitchen today versus one from the 1960's.
The problem with a static money supply is that the same amount of dollars are chasing an ever increasing supply of goods. Econ 101 says, through supply and demand, that the price of all those goods (including stocks, real-estate and other investments) will fall. So, over time, because of the falling prices of everything, the best investment is to simply hide your gold under your mattress, confident that tomorrow you'll be able to buy more with it than you were today. Deflation
Without that money in circulation, in investments or spent, it becomes impossible for businesses to raise money for future investments, governments collect less tax, and the economy stagnates. The current monetary policy is not the best. But, a strict gold standard would be even worse.
... and that's when the C.H.U.D.'s came at me.