It's official: Recession Declared

Dow Plunges 680 Points as Recession Is Declared


This is the first official recession since 2001, when the economy suffered after the bursting of the technology bubble. The period of expansion lasted 73 months, from November 2001 to December 2007.

Determination of the December 2007 Peak in Economic Activity


The committee maintains a chronology of the beginning and ending dates (months and quarters) of U.S. recessions. The committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months.

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.

Because a recession is a broad contraction of the economy, not confined to one sector, the committee emphasizes economy-wide measures of economic activity. The committee believes that domestic production and employment are the primary conceptual measures of economic activity.

The committee views the payroll employment measure, which is based on a large survey of employers, as the most reliable comprehensive estimate of employment. This series reached a peak in December 2007 and has declined every month since then.

NBER list: Business Cycle Expansions and Contractions

PeakTroughContractionExpansionCycle (peak to peak)
November 1948October 1949113745
July 1953May 1954104556
August 1957April 195883949
April 1960February 1961102432
December 1969November 197011106116
November 1973March 1975163647
January 1980July 198065874
July 1981November 1982161218
July 1990March 1991892108
March 2001November 20018120128
December 2007??????7381

Comment: I remember the recession of 1975. I was a computer salesman (IBM) and sales (and commissions) dropped off significantly.

Here's my question: If December 2007 was the last peak, when do you expect the trough?

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