It's Official: The Greatest Multi-Trillion Dollar Economic Crisis in the History of Creation Has Led to a Recession


So saith the Business Cycle Dating Committee of the National Bureau of Economic Research. Many (though not all) significant macro measures of economic growth have been on the downhill slide since the last quarter of 2007. The heart of the matter:

The committee determined that the decline in economic activity in 2008 met the standard for a recession….. All evidence other than the ambiguous movements of the quarterly product-side measure of domestic production confirmed that conclusion. Many of these indicators, including monthly data on the largest component of GDP, consumption, have declined sharply in recent months.

And some specifics:

The committee identified December 2007 as the peak month, after determining that the subsequent decline in economic activity was large enough to qualify as a recession.
Payroll employment, the number of filled jobs in the economy based on the Bureau of Labor Statistics' large survey of employers, reached a peak in December 2007 and has declined in every month since then. An alternative measure of employment, measured by the BLS's household survey, reached a peak in November 2007, declined early in 2008, expanded temporarily in April to a level below its November 2007 peak, and has declined in every month since April 2008.

Our measure of real personal income less transfers peaked in December 2007, displayed a zig-zag pattern from then until June 2008 at levels slightly below the December 2007 peak, and has generally declined since June.


The last monthly measure of production is the Federal Reserve Board's index of industrial production. This measure has quite restricted coverage—it includes manufacturing, mining, and utilities but excludes all services and government. Industrial production peaked in January 2008, fell through May 2008, rose slightly in June and July, and then fell substantially from July to September. It rose somewhat in October with the resumption of oil production disturbed by hurricanes in the previous month. The October value of the industrial production index remained
a substantial 4.7 percent below its value in January 2008.
The committee noted that the behavior of the quarterly estimates of aggregate production was not inconsistent with a peak in late 2007. The income-side estimate of output reached its peak in the third quarter of 2007. The product-side estimate reached a temporary peak in the same quarter, but rose to a higher level in the second quarter of 2008.

Link via Marginal Revolution.