From: ted@sage0.gsfc.nasa.gov (Ted Ying)
Subject: Re: The current economic situation -- what to call it?
Organization: NASA/Goddard Space Flight Center
Date: Fri, 25 Sep 1992 17:57:19 GMT

paradis@sousa.ltn.dec.com (Jim Paradis) writes:

>philco@microsoft.com (Phillip Cooper) writes:
>>As I understand it, a recession is defined as two or more consecutive
>>quarters of negative economic growth.  Our economy has been growing
>>at 1-2% for the last year.  Not much, but certainly not negative.
>>
>><text deleted>
>>
>>I agree.  The economy is in terrible shape.  I don't see it getting any
>>better anytime soon.  My point was only that we are not technically in
>>a recession...at least not in econometric terms.

>True, but remember that this is a pretty arbitrary definition of a
>"recession".  Like I said; reducing an entire economy to single
>numbers can be *very* deceptive!  This is especially true if one
>is able to cook the numbers to make it look better than it really
>is.

	Arbitrary, but currently accepted.  This is the traditional
	economics definition.  We can redefine all terms to fit our personal
	views of the current situation, but does that get us anywhere?
	We are in a poor economic recovery.  But just calling it a recession
	doesn't change the situation.  Do you want to redefine unemployed?
	We can increase or decrease employment figures by including or not-
	including temporary and part-time employees.  But this isn't the
	point.  We have to accept some basic definitions in order to have
	reasonable debate or discussion.  Changing the definition of words
	in the middle of a discussion is just contrariness for no purpose.

	The technical definition of a recession is three or more quarters
	of negative economic growth.  We have not been in a recession for
	over a year now.  We have been in a depressed economy (but not a
	depression).

>One nice example of this was the recent announcement of unemployment
>figures; nationally, unemployment went down 0.1% in August.  Now,
>the spokesperson admitted that this was because of a lot of Federally-funded
>summer jobs, and these were coming to an end.  Nevertheless, they
>were probably *hoping* that the sound-bite would simply read "Unemployment
>Down".  Never mind that many of these summer-employed were probably making
>twice as much in manufacturing before being pink-slipped... they're
>*employed*, right? 8-P
>
	Yes, but also remember, that if they were counting those summer
	students as employees, then the unemployment figures should be
	lower still.  If they hadn't counted those jobs at the beginning
	of the summer as a decrease in unemployment, they wouldn't have to
	count them now as an increase in unemployment.  In other words, if
	those jobs weren't counted in the employment figures, they wouldn't
	be employees "unemployed" and hence our unemployment figures would
	be better still!

>The other thing to realize is that, even when we're *technically* out
>of a recession, there's going to be a long period where people struggle
>to make up the losses of the recession.  In other words, even though
>we {are|will be} "climbing", we'll be climbing out of a hole.  It'll 
>still be a while before we see daylight again 8-) 8-(
>
	True, we are still in a period of poor economic recovery, but we
	are in fact in economic recovery.  The original debate was over
	whether or not we were in a recession.  We are technically not in
	a recession althought we are in a poor economic recovery of little
	(but some) growth.

	Ted Ying			ted@rosserv.gsfc.nasa.gov
	Hughes/STX			Goddard Space Flight Center
Newsgroups: misc.jobs.misc