I think if you asked just about anyone this year if we were in a recession they would have responded “yes.” Of course it just can’t officially be a recession until The National Bureau of Economic Research says it is.
Oddly enough, they have been eerily quite this year. Sure we get the occasional “could be getting close” and “we are waiting for more information” – number crunchers always need more facts than looking outside the office at foreclosures, rising gas prices, loss of jobs, and lack of consumer spending.
Well, yesterday the official stamp arrived. The U.S. economy has been in a recession since December 2007. I am not sure this actually surprised anyone but there is something about putting a label on it that will make it more real for those out there who have been in denial.
Key players believe we may be in for a bit more of a downturn…
“While we are making progress, the journey ahead will continue to be a difficult one. But I have confidence that we are pursuing the right strategy to stabilize the financial system and support the flow of credit into our economy.” – Treasury Secretary Henry Paulson
“Even if the functioning of financial markets continues to improve, economic conditions will probably remain weak for a time.” - Federal Reserve Chairman Ben Bernanke
“I’m sorry this is happening…” – President George W. Bush
Additionally, yesterday the DOW dropped 679 points to 8,149. Both Amex and Chase announced they would cut available credit by as much as 45 percent.
On the upside?…ummm, I will have to get back to you on that one.
My question: Were you surprised by the “official” announcement or did you already kind of have a “feeling” we were in a recession?