The R Word

Is anyone out there still saying we might not be in a recession? Because the evidence isn't looking too rosy for that viewpoint.

The BEA has come out with its third quarter GDP estimates, which were predicted to be down 0.3 percent from the previous quarter. Today's numbers correct that to 0.5 percent, with no indication that it will be going up any time soon. Export numbers are one of the few things keeping the GDP from being worse, and they're not likely to go anywhere but down as the rest of the world's economy gets dragged down with us.

The formal definition of a recession is two successive quarters of shrinking GDP. If the next quarterly report also shows a decrease, as seems likely, we will officially have been in a recession since July. Of course, with the average American having more trouble finding and keeping work, staying in a house, or keeping health insurance, the detail of whether the economy meets the formal definition of recession is probably of little importance to most people. But the few still crowing about the strength of the fundamentals of our economy while ignoring the day-to-day evidence they see around them may have a little more cause to revise their statements.