When Do We Start Calling This “The Greater Depression”?

[ksen]

http://equitablegrowth.org/2014/08/...depression-early-friday-focus-august-29-2014/

A year and a half ago, when some of us were expecting a return to whatever the path of potential output was by 2017, our guess was that the Great Recession would wind up costing the North Atlantic in lost production about 80% of one year’s output–call it $13 trillion. Today a five-year return to whatever the new normal might be looks optimistic–and even that scenario carries us to $20 trillion. And a pessimistic scenario of five years that have been like 2012-2014 plus then five years of recovery would get us to a total lost-wealth cost of $35 trillion.

At some point we will have to stop calling this thing “The Great Recession” and start calling it “The Greater Depression”. When?

Couple this with the increased pessimism being exhibited by Americans and the near future doesn't look too good.

Americans foresee unending economic doom

Maybe I won't be retiring in 20 years after all.

 

[arkirk]

http://equitablegrowth.org/2014/08/...depression-early-friday-focus-august-29-2014/



Couple this with the increased pessimism being exhibited by Americans and the near future doesn't look too good.

Americans foresee unending economic doom

Maybe I won't be retiring in 20 years after all.

Depression is a clinical term too. When that sets in on our society and is widespread, it is right to call it a depression. It looks like 71% of us feel we are in a permanent hole. There are structural adjustments that could be made that could at least ease this sad state of mind our whole country seems to be living with. Our elected government simply refuses to take any meaningful action on this problem. Man! That is depressing alright.

 

[dismal]

When Do We Start Calling This “The Greater Depression”?

When there's not a Democrat president?

 

[GenesisNemesis]

When Do We Start Calling This “The Greater Depression”?

When there's not a Democrat president?

Have any evidence that the economy is worse under democratic presidents?

 

[Underseer]

When there's not a Democrat president?

Have any evidence that the economy is worse under democratic presidents?

Of course. You would have noticed if you were paying attention. The Great Depression was caused by FDR, to name one very obvious example. You would have noticed that if you weren't so busy hating our freedom and trying to implement a Soviet-style communist dictatorship in America. [/conservolibertarian]

 

[Loren Pechtel]

If this is the greater depression you need to provide numbers comparing it to the great depression.

 

[AthenaAwakened]

Popular joke from the 1970s

When your neighbor is out of work, it's a recession.
When you are out of work, it's a depression.

 

[dismal]

When there's not a Democrat president?

Have any evidence that the economy is worse under democratic presidents?

Woosh. Sound of point going past you.

 

[GenesisNemesis]

Have any evidence that the economy is worse under democratic presidents?

Woosh. Sound of point going past you.

I may have misread. Sometimes I misread things. It happens.

 

[Jason Harvestdancer]

I've been calling it Great Depression II for a while. But whenever I do so I've been told I'm just a Kooky Austrian Libertarian who doesn't know anything about politics because we've been seeing green shoots and signs of growth for years now.

- - - Updated - - -

The Great Depression was caused by FDR, to name one very obvious example.

Did you learn that on Fox News?

 

[Under the Rose]

The following is from the second link provided in the OP:

Really, what the report seems to show is that strong improvements in the economic numbers haven't registered with Americans. That's not because Americans are wrong — rather, it's that numbers don't tell the whole story. The nearly 10 million new jobs created since early 2010 feel less promising if the bulk of them are low-wage. Likewise, record stock index levels don't help people if they don't own stock.

The disparity of income between low and high wage earners is a factor that few seem to mention. Being 'employed' is meaningless if your wage cannot provide you with at least the basics of food, shelter and health care. (I'm Canadian and I know the value of at least basic health coverage for all.) In contract negotiations with corporations, they desire to retain the majority of their staff at minimum wage scales and part-time hours,( try getting a mortgage with that as security) retaining only a few full time positions with benefits which they dangle as incentive for those in 'the progression' as they call it. This leads to retention figures of 29 people of 166 after 5 years, so no mentoring or skilled back-fill coming along either to cover for illness and vacation time. There is limited ability to advance, and if you quit and return, they usually exercise their right to make you start at the very bottom rung once again.

I think this 'depression' started much farther back than most realize and sadly expect it to get a lot worse before the ivory towers fall.

 

[Toni]

Anybody here have grandparents still alive?


During the Great Depression, U.S. unemployment rose to nearly 25 percent. In our most recent downturn, unemployment topped out at what? 10 percent?
During the crash of 1929 and shortly thereafter, bankers leapt to their deaths in shame and despair. In the 2008 crash, no one jumped and in fact, we haven't really even slowed down bonuses to executives of failed banks.

 

[Togo]

During the Great Depression, U.S. unemployment rose to nearly 25 percent. In our most recent downturn, unemployment topped out at what? 10 percent?
During the crash of 1929 and shortly thereafter, bankers leapt to their deaths in shame and despair. In the 2008 crash, no one jumped

Yeah, they did. Just not as many.

and in fact, we haven't really even slowed down bonuses to executives of failed banks.

They did slow down for the first few years.

No real change to the system though. There's now a move to encourage mortgage securitisations again, since the fuss has died down.

 

[laughing dog]

Of course, people are free to expand the meaning of terms like "Depression" or "Recession" to make rhetorical points. However, to imply that the US experience over the past 5 or so years is equivalent to the US experience during the Great Depression is either ignorant or dishonest. There is no good reason to make such a linkage.

 

[Nice Squirrel]

When Do We Start Calling This “The Greater Depression”?

When the current expansion ends?

 

[Jason Harvestdancer]

When Do We Start Calling This “The Greater Depression”?

When the current expansion ends?

There were periods of grown during Great Depression I, so by your reasoning obviously it wasn't a depression.

 

[SimpleDon]

When Do We Start Calling This “The Greater Depression”?

When the current expansion ends?

What we experienced wasn't technically a depression, which is defined as two or more quarters where the year to year drop in GDP is greater than 10%. We had a year to year drop in GDP of ~9%.

It is the most serious recession that we have had since the Great Depression.

The reason that it feels like a depression, at least for the 99%, is because of the slow recovery. What some are calling the secular stagnation. The Japanese type slow or no growth with reoccurring recessions but no booms to balance them out. The lost decades

The slow or no growth is because we have over the years reduced what is called our effective demand. The idea of effective demand boils down to the fact that not only must consumers want to buy things, they also have to have the money to buy things.

If you think that this is too simple, to obvious to not be true it will depress you all the more when I tell you that the mainstream economics that we base our economic policies on doesn't accept the concept of effective demand.

Unfortunately we have just about at our current limit of effective demand. This means that we are headed for another recession. Which will catch the mainstream economists by surprise, yet again.

 

[SimpleDon]

When Do We Start Calling This “The Greater Depression”?

When the current expansion ends?

There were periods of grown during Great Depression I, so by your reasoning obviously it wasn't a depression.

Correct. The largest drop in GDP in the 20th century was followed by the largest growth in the 20th century. It just wasn't large enough to return the GDP to pre-depression levels until the economic boost from World War II spending.

There was a recession too during the Depression years, brought on by the ill advised austerity program of 1936, when they tried to balance the budget.

 

[Loren Pechtel]

Anybody here have grandparents still alive?


During the Great Depression, U.S. unemployment rose to nearly 25 percent. In our most recent downturn, unemployment topped out at what? 10 percent?
During the crash of 1929 and shortly thereafter, bankers leapt to their deaths in shame and despair. In the 2008 crash, no one jumped and in fact, we haven't really even slowed down bonuses to executives of failed banks.

You can't compare them, though--we measured unemployment differently then.

And there weren't a bunch of banker suicides in 1929 anyway.

 

[Nice Squirrel]

When Do We Start Calling This “The Greater Depression”?

When the current expansion ends?

There were periods of grown during Great Depression I, so by your reasoning obviously it wasn't a depression.

Um, we have been out of recession for about 4 years and many places are at or above full employment. Is the sky falling?