California Business Minute™

Hi, I am Tim Johnson and welcome to the California Business Minute

The National Bureau of Economic Research, the organization that dates when a
recession starts and when it ends recently met to review data to determine an
end date if there is one to the recession.

The Bureau’s Business Dating Committee is chaired by Robert Hall a professor
from Stanford University. The Committee met on Monday to discuss the dates. 
The committee released an unusual statement. While acknowledging it met last
week, it said the group found it "premature" to declare the recession over,
(see below).

The Business Cycle Dating Committee of the National Bureau of Economic
Research met at the organization’s headquarters in Cambridge, Massachusetts,
on April 8, 2010. The committee reviewed the most recent data for all indicators
relevant to the determination of a possible date of the trough in economic
activity marking the end of the recession that began in December 2007. The
trough date would identify the end of contraction and the beginning of
expansion. Although most indicators have turned up, the committee decided
that the determination of the trough date on the basis of current data
would be premature. Many indicators are quite preliminary at this time
and will be revised in coming months. The committee acts only on the basis
of actual indicators and does not rely on forecasts in making its determination
of the dates of peaks and troughs in economic activity. The committee did
review data relating to the date of the peak, previously determined to have
occurred in December 2007, marking the onset of the recent recession. The
committee reaffirmed that peak date.

Meanwhile, Committee member Robert J. Gordon, a professor of economics at Northwestern
University, quickly circulated his own judicial-style dissenting opinion, stating that
he "strongly disagree(s)" and that it is "obvious that the recession is over."
Apparently the Committee got hung up on the prospect of a double-dip recession, he said,
a scenario that he personally finds "implausible."

As it was once said, put two economists in a room and you will get three answers
appears to apply here.

I am Tim Johnson and this has been the California Business Minute.

See details at http://www.nber.org/cycles/april2010.html