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progree

(12,079 posts)
20. Folks, two negative quarters in a row is NOT officially a recession. The NBER is the widely accepted arbiter of when
Thu May 1, 2025, 02:29 AM
May 1

Last edited Thu May 1, 2025, 07:39 PM - Edit history (2)

recessions occur. (The U.S. government Bureau of Economic Analysis says the NBER -- National Bureau of Economic Research -- is the official arbiter -- see below). Not Internet memes and myths, no matter how common they may be.

https://www.nbcchicago.com/news/local/what-is-a-recession-impacts-jobs-real-estate-economy/3693896/

Dr. Antonio Saravia says the “conventional definition” of a recession is when there is negative growth in the GDP in two consecutive quarters.

"conventional definition" -- a common definition would be better wording. But as the article goes on to state, it is not the official definition.

Unemployment rates and payroll data can also be used to determine the start and end dates of a recession, according to economists.

The National Bureau of Economic Research also holds that significant declines in economic activity must be evaluated on their depth, diffusion and duration.

"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. A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough," according to the Business Cycle Dating Committee with NBER, which officially determines if a recession has occurred. https://www.nber.org/news/business-cycle-dating-committee-announcement-january-7-2008


https://www.nber.org/research/business-cycle-dating
http://www.nber.org/cycles/recessions_faq.html
which morphs into:
https://www.nber.org/research/business-cycle-dating/business-cycle-dating-procedure-frequently-asked-questions

Q: The financial press often states the definition of a recession as two consecutive quarters of decline in real GDP. How does that relate to the NBER's recession dates?

Q: Why doesn't the committee accept the two-quarter definition?

Q: When did the NBER become the quasi-official arbiter of US business cycle dates?


https://www.google.com/search?q=is+the+nber+the+official+arbiter+of+when+recessions+occur

From the Bureau of Economic Analysis (BEA.gov) https://www.bea.gov/help/glossary/recession
In general usage, the word recession connotes a marked slippage in economic activity. While gross domestic product (GDP) is the broadest measure of economic activity, the often-cited identification of a recession with two consecutive quarters of negative GDP growth is not an official designation. The designation of a recession is the province of a committee of experts at the National Bureau of Economic Research (NBER), a private non-profit research organization that focuses on understanding the U.S. economy. The NBER recession is a monthly concept that takes account of a number of monthly indicators—such as employment, personal income, and industrial production—as well as quarterly GDP growth. Therefore, while negative GDP growth and recessions closely track each other, the consideration by the NBER of the monthly indicators, especially employment, means that the identification of a recession with two consecutive quarters of negative GDP growth does not always hold. For information on recession, or business-cycle, dating, see: http://www.nber.org/cycles/jan08bcdc_memo.html.

This is especially significant because the BEA is the government organization that produces the GDP numbers.

Recommendations

1 members have recommended this reply (displayed in chronological order):

I know you're working on PCE. mahatmakanejeeves Apr 30 #1
I had installed the Yahoo! Finance app on my idevices a couple weeks ago BumRushDaShow Apr 30 #6
if you want to read more on bloomberg use reader mode on your browser moonshinegnomie Apr 30 #7
Oh I know that little trick BumRushDaShow Apr 30 #10
It will be even worse for the 2nd quarter numbers moniss Apr 30 #2
Don't worry, everybody! The economy only contracted due to a massive increase in the trade deficit Prairie Gates Apr 30 #3
THE BEST...IS YET...TO COME!!!! Midnight Writer Apr 30 #4
Make America Grow Negatively Again IronLionZion Apr 30 #5
and the moron is blaming biden (of course) moonshinegnomie Apr 30 #8
The argument about imports is really fishy Bluetus Apr 30 #13
It Is Not The Arithmetic That Will Go In The Other Direction DallasNE Apr 30 #15
I agree with you. The economists have this backwards. Bluetus Apr 30 #19
This message was self-deleted by its author MichMan Apr 30 #9
Why are Americans taking this?? Canada Kid Apr 30 #11
With all due respect. Keep this in mind ..People who voted for Trump are Trump. chouchou Apr 30 #18
And the orange Hitler is blaming President Biden for this! kimbutgar Apr 30 #12
Translation, If This Growth Trend Continues In The 2nd QTR DallasNE Apr 30 #14
And, right on cue, he blames Biden. SergeStorms Apr 30 #16
Make America G...glub...glub..glub... LudwigPastorius Apr 30 #17
Folks, two negative quarters in a row is NOT officially a recession. The NBER is the widely accepted arbiter of when progree May 1 #20
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