[Infowarrior] - It's 'official' -- NBER says we're in a recession

Mon Dec 1 19:19:37 UTC 2008

(this is the group of economists that declares "official" recessions  
for the history books.....--rf)

Panel says US has been in recession since Dec. '07  	
Dec 1 02:32 PM US/Eastern
By MARTIN CRUTSINGER
AP Economics Writer

http://www.breitbart.com/print.php?id=D94Q2TJO0&show_article=1

WASHINGTON (AP) - The U.S. economy has been in a recession since  
December 2007, the National Bureau of Economic Research said Monday.

The NBER—a private, nonprofit research organization—said its group of  
academic economists who determine business cycles met and decided that  
the U.S. recession began last December.

By one benchmark, a recession occurs whenever the gross domestic  
product, the total output of goods and services, declines for two  
consecutive quarters. The GDP turned negative in the July-September  
quarter of this year, and many economists believe it is falling in the  
current quarter at an even sharper rate.

But the NBER's dating committee uses broader and more precise  
measures, including employment data. In a news release, the group said  
its cycle dating committee held a telephone conference call on Friday  
and made the determination on when the recession began.

The White House commented on the news that a second downturn has  
officially begun on President George W. Bush's watch without ever  
actually using the word "recession," a term the president and his  
aides have repeatedly avoided. Instead, spokesman Tony Fratto remarked  
upon the fact that NBER "determines the start and end dates of  
business cycles."

"What's important is what is being done about it," Fratto said. "The  
most important things we can do for the economy right now are to  
return the financial and credit markets to normal, and to continue to  
make progress in housing, and that's where we'll continue to focus."

Many economists believe the current downturn will last well into 2009,  
and will be the most severe slump since the 1981-82 recession. The  
country is being battered by the most severe financial crisis since  
the 1930s as banks struggle to deal with billions of dollars in loan  
losses.

The Bush administration won approval from Congress on Oct. 3 for a  
$700 billion rescue package for the financial system. Bush said in an  
interview with ABC's "World News" to be aired Monday that he would  
support additional intervention if necessary to end the recession.

"I'm sorry it's happening, of course," Bush said, referring to a  
global financial crisis that has eliminated millions of jobs and  
damaged retirement accounts.

Both Federal Reserve Chairman Ben Bernanke and Treasury Secretary  
Henry Paulson were scheduled to give speeches Monday providing an  
update on how the government's rescue efforts are working to deal with  
the economic distress.

Two new reports on the economy provided a grim snapshot of how steep  
the slump is becoming. The Commerce Department reported Monday that  
construction spending fell by a larger-than-expected 1.2 percent in  
October, while the Institute for Supply Management said its gauge of  
manufacturing activity dropped to a 26-year low in November.

The GDP contracted by 0.2 percent at an annual rate in the fourth  
quarter of 2007, but that that drop was followed growth in the first  
two quarters of this year, partially boosted by the distribution of  
millions of economic stimulus payments.

However, employment, one of the measurements tracked by the NBER, has  
been falling since January.

The NBER decision means that the economic expansion lasted from  
November 2001 until December 2007. Economic expansions peak and  
recessions begin in the same month, according to the NBER's dating  
methods. Founded in 1920, the NBER has more than 1,000 university  
professors and researchers who act as bureau associates, studying how  
the economy works.

The decision on the recession means that during the eight years that  
Bush has been in office, the country has seen two recessions. The  
first downturn lasted from March 2001 until November of that year.