Pssss… No U.S. recession…..

[Coronita]

Yup…Yessiree… The experts indicates there is no recession….

wink wink…

http://finance.yahoo.com/news/No-Recession-for-US-as-bloomberg-3344563177.html?x=0&sec=topStories&pos=1&asset=&ccode=

The U.S. has likely dodged a recession for now, even though it’s too early to sound the all- clear for the economy.

A string of stronger-than-projected statistics — capped by the news on Oct. 7 of a 103,000 rise in payrolls last month — has prompted economists at Goldman Sachs Group Inc. and Macroeconomic Advisers LLC to raise their growth forecasts for third quarter growth to 2.5 percent from about 2 percent. That’s nearly double the second quarter’s 1.3 percent rate and would be the fastest growth in a year.

“The U.S. economy doesn’t look like it’s double-dipping at all,” said Allen Sinai, president of Decision Economics Inc. in New York. “But it is a crummy recovery.”

That recovery still faces what economist Chris Rupkey in New York calls “a lot of headwinds.” These range from the sovereign-debt crisis in the euro zone — and increasing likelihood of a recession there — to political gridlock in the U.S. over the budget.

“We can skirt a recession,” said Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. “But if headlines worsen in Europe and cause a major stock-market rout, it could lead to a loss of confidence here on the part of businesses and consumers and make forecasts for a recession a reality.”

Crisis Plan

European stocks and the euro rose after German and French leaders pledged to devise a plan to stem the debt crisis in three weeks. U.S. stock futures also gained.

The unsettled outlook may push U.S. Treasury bond yields back down as investors seek safety in the debt of the world’s largest economy. The yield on the 30-year bond remains on course to fall to about 2.5 percent, according to Christopher Hine, vice president of technical analysis at Credit Suisse Securities in London.

“The bull trend is still there,” he said in an Oct. 7 conference call with clients.

The long bond ended trading at 3.017 percent in New York on Oct. 7, after touching 2.69 percent Oct. 4, the lowest since January 2009. Yields rose as concerns about a recession ebbed.

The Standard & Poor’s 500 Index will face difficulty trading above 1,200 in the next few weeks as investors seek to determine the impact of the European crisis on U.S. corporate earnings, Sinai said. Business with Europe represents about 20 to 25 percent of operating profits for companies in the S&P, Sinai said.

Futures Rise

S&P 500 futures added 1.4 percent as of 11:24 a.m. in London, while the Stoxx Europe 600 Index rose 0.6 percent, extending a three-day, 6.7 percent jump. The S&P 500 had climbed as much as 0.6 percent on Oct. 7 on the back of the jobs numbers before being erasing gains after Fitch Ratings downgraded the foreign and local currency long-term issuer default ratings for Spain and Italy.

The euro advanced 1.6 percent against the dollar and strengthened 1.5 percent versus the yen after German Chancellor Angela Merkel said European leaders will do “everything necessary” to ensure that banks have enough capital.

Exceeded Forecasts

The 103,000 gain in September payrolls announced by the Labor Department was more than economists had forecast and followed an upwardly revised gain of 57,000 for August. Private employment climbed 137,000 and included the return of 45,000 striking workers at Verizon Communications Inc.

“The continued forward momentum in private job growth should ease concerns that the U.S. will slip into recession in the second half of this year,” said Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York.

The latest numbers bring the jobs data in line with what other statistics are suggesting: Gross domestic product is growing “very slowly,” not contracting, he said.

Construction spending rebounded in August, propelled by the biggest jump in state and local government outlays in more than two years. Manufacturing accelerated in September, helped by gains in exports and production.

“For the first time in eight months, we revised upward our forecast of GDP growth over the second half, to just shy of 2.5 percent,” economists at St. Louis-based Macroeconomic Advisers said in a report last week. In September, they were predicting second-half growth under 2 percent.

The drags on the economy in the first half of the year — higher gasoline prices and supply-chain disruptions from the earthquake and tsunami in Japan — are dissipating, giving growth a lift, Feroli said.

Upward Revision

The average price for unleaded gasoline fell almost 20 cents, or 5.4 percent, in September to $3.43 a gallon, according to AAA, the nation’s largest motoring group.

The automobile industry has been an obvious beneficiary. Car and truck sales rose to a seasonally adjusted annualized rate of 13.1 million in September, according to Autodata Corp. That’s the highest since April’s 13.2 million, when lost output caused by the tsunami started restraining supply.

With vehicle production and inventories recovering for Toyota Motor Corp. (7203) and Honda Motor Co., the fourth quarter may be the year’s strongest, Al Castignetti, Nissan Motor Co.’s vice president of U.S. sales, said in an Oct. 3 telephone interview.

“People who have been sitting on the fence are likely to get back in the market,” he said.

While the U.S. is “shaking off” the first-half drags, it faces risks from events at home and overseas, Feroli said.

‘Edge of Recession’

The debt crisis in Europe will “likely slow the economy to the edge of recession by early 2012,” Andrew Tilton, senior economist at Goldman Sachs in New York, said in note last week to clients. He sees growth falling to a half percent in the first quarter of 2012.

A mild recession in the euro zone could shave as much as a half percentage point off U.S. expansion, said Nariman Behravesh, chief economist in Lexington, Massachusetts, at IHS Inc. The direct effect on trade likely would be small, he said. U.S. exports to the euro area were equivalent to less than 2 percent of GDP last year.

Greater consequences could come from the financial links between the two economies and the impact of the crisis on the U.S. stock market and general confidence.

“Europe is so large and so closely integrated with the U.S. and world economies that a severe crisis in Europe could cause significant damage by undermining confidence and weakening demand,” Treasury Secretary Timothy F. Geithner said Oct. 6 in testimony to the Senate Banking Committee. That would pose a “significant risk to global recovery.”

Confidence

Policy makers in Europe aren’t the only officials on the spot, according to Diane Swonk, chief economist at Mesirow Financial Inc. in Chicago. Authorities in the U.S. also need to act, she said. If a Congressional supercommittee can’t come up with the more than $1 trillion in budget savings required by November, “that further undermines confidence in our own government,” she said.

The U.S. also faces a big fiscal squeeze in 2012 from the scheduled expiration in December of a payroll-tax cut, extended unemployment benefits and a business-tax credit.

“We have a very big tightening on track for next year,” Feroli said. He put the amounts involved at about $350 billion, or the equivalent of about 2 percent of GDP.

President Barack Obama has offered a $447 billion jobs plan that includes an expansion of the payroll-tax cuts in 2012 and an extension of the unemployment benefits. It faces resistance in the House of Representatives, where Republicans hold the majority and oppose the tax increases Obama proposed to pay for the program.

“We’re still laboring under the fallout from the bursting of the housing and credit bubble,” Jan Hatzius, chief economist for Goldman Sachs in New York, told Bloomberg Television on Oct. 7. “In the aftermath of that, unfortunately, you’re often in a weak position for a long time.”

[Anonymous]

Do you really have to post the whole dang article?

There is a strict technical definition for the term “recession.” I don’t know it offhand, but it’s like two quarters of negative growth as measured by GDP or something.

So the question of recession/no recession comes down to a number. It’s a pass/fail test based upon a standardized measurement. It is not a subjective definition.

I find it amusing that engineers have a hard time understanding this.

You can have high unemployment and an otherwise lousy economy and still not be in a recession.

Now we may carry on with this thread, where most will argue that we are in a recession, based upon their personal definition of the word.

[Jazzman]

Double dip? We never got out of the first recession.

[all]

It is not a recession until NBER says so.

[scaredyclassic]

It’s prett much not declared a recession till it’s over.

[briansd1]

[quote=pri_dk]Do you really have to post the whole dang article?

There is a strict technical definition for the term “recession.” I don’t know it offhand, but it’s like two quarters of negative growth as measured by GDP or something.

So the question of recession/no recession comes down to a number. It’s a pass/fail test based upon a standardized measurement. It is not a subjective definition.

I find it amusing that engineers have a hard time understanding this.

You can have high unemployment and an otherwise lousy economy and still not be in a recession.

Now we may carry on with this thread, where most will argue that we are in a recession, based upon their personal definition of the word.[/quote]

Well said. People who claim we are still in recession need to define recession first.

[poorgradstudent]

Another way of looking at it is we could have GDP growth of 0.1% for four straight quarters and while we wouldn’t be in a recession, that would still be a terrible economy.
The economy still sucks, but it has been growing even as government cuts spending.

[The-Shoveler]

By goodness your right, if your unemployed it’s not a recession, it’s a DEPRESSION!!!

OK now for my latest conspiracy theory .
In order to quell this latest OWS movement, look to see the economy suddenly start adding Jobs and the markets to recover in a big way.

[UCGal]

[quote=captcha]It is not a recession until NBER says so.[/quote]
This is much more accurate than the comment about x quarters of declining gdp.
Calculated Risk posts a variety of economic indicators and often mentions that some of them are part of the consideration by the NBER when determining the recession. It’s not strictly GDP.
http://nber.org/cycles/recessions_faq.html

[temeculaguy]

I’m feeling a little saucy tonight. I’m too lazy to search for the threads but I believe I called bottom for R/E at the end of 08, early 09 and it’s been substantiated for the most part, so I’ve got some street credibility here. I also called the dow bottom so I think I can go out on a limb, trust my gut and I’m going to call the end of the recession as right now, specifically two days ago, on Saturday night. I do not expect any fantastic growth tomorrow, or even for the next year, but I think I felt that tickle, that turnaround, and I had this epiphany on Saturday. I also expect lagging indicators to do what they do best, and that is lag. Maybe it’s just me but here are my anecdotal reasons, all from this month or so.

I priced airline tickets to NYC a few months ago, pulled the trigger a few weeks ago, despite falling fuel prices, planes started filling up, I had to pay about $75 more per seat.

I made my hotel reservations, even though it’s three months away, price went up $75 a night for a very bland week January.

My work occasionally takes me to downtown SD, as it has for about a decade, in short spurts, right now I’ve had to go there a lot lately. Traffic is up, lunch is unbearable (sushi deli is 30 minutes for take out) and I go more toward 1 pm. My noon jog through seaport village and downtown is now more about carving my way through shoppers and workers than it was during my last stint there, reminds me of stints during 2003 and 2007, but nothing like six months ago, seaport village is packed and there are no cruise ships any more.

Two weeks ago, hit the local casino with the fellas, we couldn’t get a card table together, haven’t seen that in a while. I ended up playing blackjack just cause I could get a seat, I hate blackjack.

A little more than a month ago, went out with sdrealtor and friends in Temecula on a Sunday night. We got the last tickets to a Sunday jazz concert, $75 to stand in the back, the $300 seats were completely sold out, as was every seat, the restaurant we went to, late (after 9 pm), was also packed.

This last Saturday I went to that same restaurant, the Public house, nearly a two hour wait and they wont take reservations, and I got there at 6. They don’t even give you a buzzer thing and send you the bar, because you’ll be passed out by the time they have a table for you, they actually call your cell when they have a table.

Ran into the same thing in Encinitas three weeks ago at solace, was told the wait was more than an hour and 45 minutes. That’s not a wait, that’s the average length of a movie. I keep running into this, in multiple towns, where I can put my name on the wait list of a restaurant, go see a movie, and be back before they call my name.

If all I did was stay home and read piggington or other websites, the world is coming apart at the seams, if I leave my house, I feel like it’s 2006 and I’m the only guy with stock rims in a paid off car. Speaking of cars, my car shopping has yielded similar indications of consumer confidence, now that it’s getting to be about that time to take the plunge and get a new sled, I’m not finding the prices I was finding three months ago. I let a 2001 carrera cabrio garage queen with 50k miles go to some other schmuck for 20k, now I can’t find one this side of 24k that is in similar condition. 2006 vettes, 2003 XKR’s, same story, the liquidation of toys has ended. I’m going to end up driving a sonata and castrating myself with a butter knife out of frustration.

So I’m calling it, Let’s say October 8th, about 6 pm, recession ended officially.

[an]

Nicely put TG. To add my own anecdotal experience, I went to Donovan’s this past weekend and the place was practically full by 6PM. Went to Extraordinary Dessert on Union at around 7PM and it was full as well.

[temeculaguy]

And as I just mentioned on the nationwide protest thread, the true catalyst of the end of recession, the Detroit Lions, they set an attendance record tonight.

Somebody explain that? If you believe the papers they are eating rocks by now in Detroit, Attendance record in Detroit for a football game!!!, Yeah,,,,it’s over.

When you can’t get a seat to a Lions game, it’s time to stop buying spam and ammo.

[an]

[quote=temeculaguy]And as I just mentioned on the nationwide protest thread, the true catalyst of the end of recession, the Detroit Lions, they set an attendance record tonight.

Somebody explain that? If you believe the papers they are eating rocks by now in Detroit, Attendance record in Detroit for a football game!!!, Yeah,,,,it’s over.

When you can’t get a seat to a Lions game, it’s time to stop buying spam and ammo.[/quote]
But I like spam 😀

[paramount]

And for the record, Pat and Oscars reopened at the pond, so how bad could it be?

[paramount]

psssst, TG….it’s not 2006 all over again, it’s just the result of inflation.

[Author]

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