Recession in the US 'has arrived'

"The feared recession in the US economy has already arrived, according to a report from Merrill Lynch.

It said that Friday's employment report, which sent
shares tumbling worldwide, confirmed that the US is in the first month
of a recession.

Its view is controversial, with banks such as Lehman Brothers disagreeing.

An official ruling on whether the US in recession is
made by the National Bureau of Economic Research, but this decision may
not come for two years.

The NBER defines a recession as "a significant decline
in economic activity spread across the economy, lasting more than a few
months".

It bases its assessment on final figures on employment,
personal income, industrial production and sales activity in the
manufacturing and retail sectors.

Merrill Lynch said that the figures showing the jobless rate hitting 5% in December were the final piece in that puzzle."

http://news.bbc.co.uk/2/hi/business/7176255.stm

No votes yet

Recession - great time to buy!

Personally I think the last 2 qtrs will be good this year while we struggle throught the first two.

When the news breaks you're often into the cycle -- better to face the reality of the current mess than keep the spectre of one looming on the horizon. 2 or at most 3 qtrs is probably about right.

Some are calling Hank Paulson's speech yesterday (http://www.treas.gov/press/releases/hp757.htm) the most bearish speech ever by a sitting Treasury Secretary. Good I say - I'd rather have Bush, Ben and Hank face the music and deal with the mess than keep on with the moronic talk that problems are contained.

"Merrill Lynch said that the figures showing the jobless rate hitting 5% in December were the final piece in that puzzle."

During the previous administration, a 5% unemployment rate was billed as a positive thing...

I agree 5% isn't bad at all ... Merrill's data going back to 1953 suggests that a move of more than 0.5ppt off the low of the unemployment rate trough signals a recession is underway. They claim such a move is 100% accurate at indicating recessions, in this case it was a 0.6ppt move. So it's not that 5% is bad itself, just that Friday's data was bad considering what the #s had been.

... will continue to sink until the years 2012 to 2014, you're all fairly delusional about what will happen in 2008. 2008 isn't the end; it's only the beginning of the end. We still haven't even run into the collapse of all the hedge funds, from their extremely overleveraged conditions. LTCM was just a prelude. We're going to have a LTCM each quarter, once the elites like Bush, Bernanke and Paulson stop lying to us every time they open their mouths.

The underlying economic weakness in the USA is too severe to just brush off the housing crash. $1000 billion in guaranteed mortgage losses HAVE TO BE ACCOUNTED FOR. If we go all cowardly and take the Japan 1990 option, we'll only invite the same, long period of collapse and stagnation. Are YOU ready for a 15-yr period of stagnant home prices in America?

The reason the unemployment rates don't indicate how serious the matter is, is that too many people have been classified as small businessmen, who are not accounted for. When you rope those dismissed people into the picture, there is a frightening view of how un- and underemployed Americans REALLY ARE.

P.S. No one can seriously or honestly use Bernanke and Paulson as authorities to judge our economic condition. Bush we can dismiss out of hand since that silver spoon in his mouth clicks and clacks on his teeth, obscuring most of what he says. But Bernanke is ON RECORD for issuing a bald-faced lie to the American public. "Subprime is contained", anyone? (Well, either it was a lie, or he knows nothing about finance. What's more likely?) And Paulson? He was practically on his knees with the Chinese, begging them to continue buying our CRAAAAAAAP mortgage-backed securities. Neither man has any moral standing or economic credibility. I find it discouraging that any American thinks they are some sort of experts whose opinion matters in any sense.

Over the past few months, we have become increasingly concerned that the US housing and credit market downturn would trigger not just a growth slowdown and substantial Fed easing -- our long-standing view -- but also an outright recession," Goldman Sachs said in a note to clients Wednesday. "The latest data suggest that recession has now arrived, or will very shortly.

The recent rise in unemployment is particularly worrisome, Goldman indicated.

http://www.cnbc.com/id/22570827

"Goldman Sachs shorted all this mortgage nonsense, probably because their boy Paulson gave them the wink and the nod. So, they can afford to be honest with the public now. Why not? They're out from under."

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