Ravenwood - 02/25/08 06:00 AM
CNN/Money, who sometimes relies on advice from financial magnates like Billy Joel, continues to beat the "recession" drums. (No kidding. They actually have a section of their website called Recession Watch 2008.)
Because of all the bad news, more and more economists foresee the country falling into a recession, according to the latest survey by the National Association for Business Economics.CNN/Money says that a recession is "likely", but if you actually read the article, you find out that most economists don't think we are headed for a recession.
The group said in a report being released Monday that 45% of the economists on its forecasting panel expect a recession this year. In September, only one in four economists was pessimistic enough to put the chance of a recession at 35% or higher.So how does 45% become "likely"? And if you look even further, you'll find that they are redefining recession.
The survey shows that 55% still believe the country will be able to skate by without falling into an actual downturn, typically defined as two consecutive quarters of declines in the gross domestic output...So the economy is actually expected to grow, not recede. But that doesn't fit the media template, nor does it fit the CNN/Money Headline: "Recession more likely this year...".The forecasters believe GDP will expand by 1.8% this year, which would be the weakest growth in five years.
These people, who would ask you to subscribe to Money or Fortune magazine, appear to actually be rooting for a recession. How can anyone take these clowns seriously?
"typically defined as two consecutive quarters of declines in the gross domestic output"
It's not typically defined, it is defined by two consecutive quarters of declines in the gross domestic output. If this doesn't happen then we aren't in a recession.
I learned that in Economics 101. I guess it is too much to expect that writers for Money magazine would have taken the same course.
Posted by: Yosemite Sam at February 25, 2008 3:56 PM(c) Ravenwood and Associates, 1990 - 2014