You Wouldn't Know It, But...

It's time to Break It Down!

The Great Recession Is Officially Over! In fact, not only is it over, it ended in June, 2009, or 15 months ago. Say what?

That’s almost as long as the downturn lasted; 18-months, which makes the recent economic malaise, that began in December, 2007, the longest continuous economic downturn in the United States since the Great Depression (1929-1933). It is also the deepest, in terms of job losses.

This past Monday, economists, specifically, the National Bureau of Economic Research (NBER), considered the arbiter of record for economic turning points, confirmed the nascent details of the recovery. Consumers, workers, homeowners, and especially the trenchantly unemployed, continue to express doubt, frustration, and frequently, utter disbelief at that assessment. Largely because, even while a number of leading economic indicators are rebounding, an incredibly large number of Americans are still unemployed.

In grappling with ones personal belief system about the State of the Recession, it is important to remember that the declaration of the Recession’s end revolves around a fairly technical, but significant point. In essence, the Recession is not deemed over, because all indicators are fully recovered, but rather because we have passed what has been determined to have been the economic nadir, which in this case, occurred in June, 2009. Since that time, total output has increased, as have numerous other key measures of economic activity.

Still, the rate of recovery is slow; so laggardly, if the unemployment rate, currently at 9.6%, continued dissipating at its current pace; unemployment could still top 9% through the end of 2012. In that regard, this Recession distinguished itself from the economic disruptions of 1981, 1991, and 2001.

The combination of high unemployment and slow recovery give this downturn a deep and wide footprint. While the over all unemployment rate was greater in the Recession of ’81, at 10.8%, compared to 10.1% in 2009, and the job market, which bottomed six months after the worst of the economic downturn in ’09, it took nineteen months to do so after the 2001 Recession. The absence of the double-barrel impact rendered those episodes less nettlesome.

For those who look to insinuate political significance to such matters, there are probably too many to enumerate, but a couple resonate poignantly. The first point is the Obama Administration, which rightly claims to have inherited this Recession from the policies of George Bush, can ill afford to take comfort in the NBER’s proclamation. Any thing approximating a recovery is in far too embryonic a stage to warrant celebrating, or to offer Americans substantial reasons to cheer, for that matter. The second point is, given the almost imperceptible pace of the recovery, there is still more than ample time for the country to slip back into secondary or even tertiary doldrums. Certainly no saleable arguments can be made to make such reversals, should they occur, the province of Bush policies.

Since the latest Recession began just under three years ago, more than 7.3 million jobs have disappeared, and over 2.5 million families have seen their homes repossessed. Unemployment soared above 10%, and still hovers at 9.6%, while the number of underemployed, combined with discouraged workers, who do not factor into unemployment statistics, render the economic outlook in the near term dismal for many, still.

All these “Nightmares on Wall Street,” Main Street, and your street are being turned into the ammunition, or at the very least, tools, to foment change in Washington. The mid-term elections take place six weeks from now, and the Tea Party and its alter ego, the Republican Party, appear to have appropriated the agenda and most of the relevant talking points from the Democrats. The debate among pundits, talking heads, and other media mavens seems mostly to revolve around, not whether some combination of the Tea Party and the GOP can cobble together an alliance to re-take one of the Houses of Congress, but how large will their advantage be…in both Houses?

In the interim, the current Loyal Opposition has created just enough side bar issues to keep things interesting:

• Jan Brewer, incumbent Governor, and Republican Gubernatorial candidate in Arizona asserted that Law Enforcement officials found beheaded bodies in the Arizona desert, and then refused to respond to questions from the media on the subject

• Joe Miller, Senate candidate in Alaska, maintains some Social Security benefits are unconstitutional

• Christine O'Donnell, Senate candidate in Delaware contended she once “Dabbled into Witchcraft,” faces allegations of misusing campaign funds, was sued by Fairleigh Dickinson University, her alma mater for unpaid tuition, and ultimately was required to complete an additional course before receiving her degree.

Moreover, there is a chance all these candidates might win. To paraphrase former President Bill Clinton, we may b entering a period of politics that is fact-free; when experience in government is a negative attribute. Heading into mid-term elections, in many unflattering ways, the Obama Administration finds itself being cast as the ghost of the former Bush Administration, challenged by a cadre of energized opponents, who like their former selves are brandishing the mantle of change (from current government practices) as its most effective implement.

This President understands that he and his Party are between a rock and a hard place. In a Town Hall Meeting Monday in Washington, DC, President Obama noted that economist declaring the Recession over doesn’t change the reality of those who are out of work or struggling. Mr. Obama faced one woman who said she voted for him, but who added, “I’m exhausted of defending you, defending your administration, defending the mantle of change that I voted for, and deeply disappointed with where we are right now."

"Is this my new reality?" she asked.

The President responded, "My goal is not to convince you that everything is where it ought to be. It's not." Still, Mr. Obama went on, “Things are moving in the right direction under policies I have put in place.”

Undoubtedly, the question of the hour, or at least, of Election Day, will be, “Is that enough?” Yes, “You Wouldn’t Know It, But…The Great Recession is Officially Over…Really!

I’m done; holla back!

Read my blog anytime by clicking the link: http://thesphinxofcharlotte.blogspot.com/. A new post is published each Wednesday. For more detailed information on a variety of aspects relating to this post, consult the links below:

http://www.washingtonpost.com/wp-dyn/content/article/2010/09/20/AR2010092005999.html?wpisrc=nl_headline

http://news.blogs.cnn.com/2010/09/21/vets-cfo-on-obama-i-am-exhausted-of-defending-you/?hpt=T2

http://www.cnbc.com/id/15840232?video=1596469896&play=1

http://www.nytimes.com/2010/09/21/business/economy/21econ.html

http://www.msnbc.msn.com/id/39271659/ns/business-eye_on_the_economy

http://www.indystar.com/article/20100921/LOCAL18/9210321/Recession-officially-over-but-few-cheers?odyssey=tab%7Ctopnews%7Ctext%7CIndyStar.com

http://www.pbs.org/newshour/bb/business/july-dec10/news_09-20.html

http://www.msnbc.msn.com/id/39269753/ns/business-eye_on_the_economy/

http://consumerist.com/2010/09/recession-is-officially-over.html

http://wcco.com/local/recession.over.unemployment.2.1922888.html

http://www.cnbc.com/id/15840232?video=1595943737&play=1

http://economix.blogs.nytimes.com/2010/09/20/the-recession-has-officially-ended/

http://www.youtube.com/watch?v=kCvfPFDm3ho

http://www.youtube.com/watch?v=F0elygJ63-o

http://www.youtube.com/watch?v=nwIY44Z670A

http://www.cnbc.com/id/15840232?play=1&video=1165373282

http://seekingalpha.com/article/215790-banks-still-not-lending-credit-crunch-continues

http://www.economicshelp.org/blog/economics/why-are-banks-not-lending/comment-page-1/