Recessions and the Lying Liars Who Lyingly Lie About Them
While the usual pollyannas crow over the fact that our economy isn’t currently quite miserable enough to qualify for the R-word, I think some perspective is in order. As recently as last March, Beldar made a hair-trigger charge that Phil Izzo and the WSJ were “lying” when they truthfully reported that a majority of economists surveyed at the time thought the U.S. was in a recession. The gravamen of Beldar’s charge was that some use the word “recession” to describe certain economic downturns (e.g., 2001) even though they do not include declines in GDP for two consecutive quarters. In reality, as the lying liars at WSJ made clear to anyone who took the time to read the article, the definition of “recession” is a bit more complicated than the classic “two-bit” definition (UPDATE: I goofed; two “bits” add up to one quarter, not two, so make that the “four-bit” definition):
Although the classic definition of recession is two consecutive quarters of declines in the gross domestic product, [Stephen Stanley of RBS Greenwich Capital] pointed out that the National Bureau of Economic Research, the nonpartisan organization that is the official arbiter of when recessions begin and end, doesn’t necessarily follow that definition. “If you go back to the 2001 recession, there was only one negative GDP quarter, and there might not even be one negative quarter in this recession,” he said.
