Comments on: Poll: Do You Feel We’re in a Recession?

By: Tim

Tim — Sun, 23 Mar 2008 21:56:44 +0000

you are missing an option: who cares? i don’t care if we are or we aren’t. i wish people would stop getting hung up over it. ok, so if you feel the economy is bad right now, then let’s just say we are in a recession. if not, then say we aren’t. all this self fulfilling prophecy is useless and making the markets all jittery. of course there are other reasons for the jittery markets, but just admit that we aren’t or we are and let’s get on with spending more money.

By: Ron@TheWisdomJournal

Ron@TheWisdomJournal — Fri, 21 Mar 2008 13:17:15 +0000

A recession has a definition. We ARE NOT in one right now and if one starts during the first quarter of 2008, we won’t know for sure until late summer!

By: Steve Austin

Steve Austin — Fri, 21 Mar 2008 04:50:54 +0000

Folks, I’m only saying that feelings have nothing to do with the *measurement* of GDP. That’s what a recession is, nothing more than a measurement of the economy. So if you “feel” down about the economy this Q1, how can you possibly expect that to effect how NBER measures what went on economically? I find it more plausible that down feelings this quarter will affect Q2 or even Q3. Can’t turn the economy on a dime; it’s a large animal.

So if you really want to gauge the Q1 economy (i.e. find out pre-NBER report, whether we’re in a recession now) based on people’s feelings, wouldn’t it be better to ask this:

“Did you feel last year that the economy would contract in Q1 2008?”

By: billspaced

billspaced — Fri, 21 Mar 2008 03:04:46 +0000

By definition, we’re not in a recession. Generally, it is not proclaimed that we’re in a recession until we’re half way or more out of it. It’s the nature of the beast.

However, I can say that we’re in a pretty bad place. Housing, credit, consumer spending, employment, growth, inflation — all on the downturn. Housing and the subsequent credit crunch have really taken the wind out of the wealth sails — people feel poorer and take the appropriate actions, like cutting discretionary spending.

Let’s hope this all unfolds pretty normally rather than the protracted recession that many economists are predicting. My question is, where were they 6 months or a year ago? Yeah, they were saying “no recession in sight.”

By: Jeremy

Jeremy — Thu, 20 Mar 2008 23:15:12 +0000

Steve, I think consumer/investor sentiment has much more to do with how things play out than what a bunch of statistics and numbers about the economy do. If people feel like money is tight, they won’t spend it, or spend it on something different than what they otherwise would have.

If there is a sense of insecurity in the equities market, people flee from stocks and mutual funds and stash everything away in cash or bonds.

If there are uncertainties with employment and in real estate, people aren’t going to be as likely to move or look for new jobs.

All of these behaviors are driven by personal perception of their situation, and what NBER says one way or another won’t change that. Of course, their decisions and statistics can further accelerate these behaviors, but we may never meet the exact definition of a recession, but some people are certainly behaving in a way that says they are.

By: Webomatica

Webomatica — Thu, 20 Mar 2008 21:31:14 +0000

Steve since this looks to be a consumer led recession I think the feelings of consumers are totally valid.

By: Steve Austin

Steve Austin — Thu, 20 Mar 2008 18:17:47 +0000

What do feelings and fuzzies have to do with whether the NBER at some point in the future determines that 1Q2008 was either the first or second in a succession of 2 or more quarters of negative GDP? ;-\ My point is that feelings are not good predictors of statistics and statistics don’t respond to feelings.

By: Fiscal Musings

Fiscal Musings — Thu, 20 Mar 2008 16:20:41 +0000

I don’t think we’ve hit a recession yet. I don’t see a pull back in spending, driving, grocery shopping and the like. People are less optimistic in general, but I see more complaining than an actual decrease in spending.

By: Anonymous for privacy

Anonymous for privacy — Thu, 20 Mar 2008 16:15:10 +0000

We have been in recession for over 6 months now. I was lining up to buy a house in San Francisco in August 2007, and wanted to get a loan for the tax benefits. I have a good FICO score, make $200K a year and have $1.2M in cash in a high-interest savings account, and yet all I could get for a $600K loan was a 15-year interest-only loan at over 7%, i.e. worse than just renting. Naturally I dropped my offer, and I can’t imaging the economy won’t suffer severely from the credit crunch.

By: Jen

Jen — Thu, 20 Mar 2008 14:56:22 +0000

I voted “Yes” not because I’ve noticed increased grocery prices (don’t shop enough to notice), or I’ve seen layoffs where I work, but because I just have a general feeling in my gut that Things Are Not Good. Plus, I’ve been seeing more empty storefronts at the strip mall near my home. In fact, one bargain department store went out of busy 2-3 years ago, and its old building is STILL empty. Doesn’t give me the warm fuzzies.