Are we in a depression? Is it because of Bush? ???
I seem to think so. The Dow is under 8000, the Nasdaq is under 1500. Unemployment is over 8%. Some estimates put it at over 12%, (Including those of us who have been jobless for more than 6 months.)
I seriously doubt that. The economy started slowing down before George W. Bush took office. The recession started on Clinton’s watch.
The DJIA is not the ‘Global Economic Chart’. Never has been, never will be. The economy is growing, unemployment is not “over 8%”, and I have not heard (until now) anyone even suggest that it is over 12%. The BLS has it at 6%, which is not far off from ‘full employment’.
So no, we are not in a depression.
alien:
Sorry, but I don’t even think we’re in a recession (defned as 2 consecutive qtrs of falling GDP). Good luck in your job search.
No. A recession is defined as a reduction in the GDP. We suffered that for about one or two quarters last year. A depression is characterised as several quarters of recession accompanied by extended high unemployment rates and deflation.
Unemployment is about 5-6% depending on where you are. The difference is that the job market is more stagnant than it was a few years ago so those with jobs are less likely to leave.
Compare that to the Great Depression with sustained unemployment of 25%.
We’re not there yet, but we’re about as close as you can get and not be there. The optimism of all the previous respondents is as good a contrary indicator as it gets.
Watch out below. There’s nothing but air down there.
All right, I’ll bite: who exactly is “estimating” the national unemployment rate at 12%? For that matter, who is saying the national unemployment rate is 8%?
Here’s a handy little cite:
Peruse the website of the folks that actually track unemployment figures, and for god’s sake, fight some ignorance…
I’m with ALIEN: we are in a depression…and because nothing is ever the same, this depression is different:
-firts, GNP hasn’t declined…this because people are still buying houses like crazy-the extremely low interest rates have kept the housing market alive.
Second, we are experiencing actual deflation in some sectors-interest rates are actually ZERO in Japan!
Third,jobs are leaving the USA in many manufacturing sectors, largely going to China and asia.The comforting illusion that we (in the USA) can preserve the high-paying jobs in areas like computer programming, software, insurace etc. is being exposed for the myth that is always was-programming is now moving to places like India, and those jobs ain’t coming back,
Finally, the USA unemployment rate is (onthe surface) not too bad…but the figure doesn’t include people who have given up looking for work, and those who haven’t burned through their severance packages yet.
This thing will really get bad (full-blown depression) when housing prices start to collapse, which will start this summer (unless the democrats in congress relent and allow Bush’s economic stimulus package to be passed.
What really scares me…we are now in the 4th year of a bear market in stocks…this hasn’t been seen since 1912!
One interesting measure of the economy is bankruptcies. 2002 was a record year for bankruptcies in public companies, though I haven’t seen data for private companies.
Alan Feld, a bankruptcy attorney with Manatt Phelps & Phillips in Los Angeles. “I think it’s going to get worse before it gets better.”
cite: http://www.cmonitor.com/stories/market/bizstori2002/0101_bankrupt_2002.shtml
I guess if you want to change the definition of “depression” then that’s fine. But bear markets and recessions are not nearly the same thing as a depression according to the traditional definition.