According to the National Bureau of Economic Research (NBER), a recession is a "significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales." Here's how some of those key recession-indicating variables are doing:
1. Industrial production: Increased by 4.67% at an annual rate over the most recent three month period from May to August.
2. Private payroll employment: Increased by 1.27% at an annual rate during the most recent three month period from May to August.
3. Real GDP: Increased by 1.33% in the second quarter.
4. Real Retail sales: Decreased by 0.56% in the May-August quarter, at an annualized rate.
Other indicators:
5. Automakers are reporting strong sales gains in September vs. last year: Chrysler +27%, Ford +9% and GM +20%.
7. Weekly rail freight shipments are showing ongoing signs of increases in economic activity, not declines.
8. Jeremy Piger's "recession probability" (based on four monthly variables: non-farm payroll employment, industrial production, real personal income excluding transfer payments, and real manufacturing and trade sales) was updated last week for July at 0.9% (less than 1 out of 100 chance), unchanged from June, and down from 1.2% in May and 1.1% in April.
MP: All of the variables reported above are positive except for real retail sales. Taken together as a group, these positive indicators suggest that while the current expansion might be sub-par, the economy is certainly not experiencing any of the significant, persistent and widespread declines that would lead the NBER to declare sometime next year that the U.S. economy entered a recession in any of the recent months.
MP: All of the variables reported above are positive except for real retail sales. Taken together as a group, these positive indicators suggest that while the current expansion might be sub-par, the economy is certainly not experiencing any of the significant, persistent and widespread declines that would lead the NBER to declare sometime next year that the U.S. economy entered a recession in any of the recent months.
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