If you were paying attention last week, you might remember a little segment we did with Gregg Easterbrook where he argued that while people are complaining about the economy right now, in reality, it's never been better in this country. Well, you might say that listeners disagreed with him. I can't print what some had to say on a family-friendly blog, but the phrase, "what planet do you live on???" came up repeatedly. Anyway, he obviously hit a nerve, and there is clearly a divide between those who think the country is going to hell in a hand basket, and those who argue that, objectively, the U.S. has never been better off. So here's the question, with all this confusion out there: What are the economic indicators you pay attention to as you figure out this economic moment? Do you care more about national employment figures, or what you had to shell out at the grocery store last week?
Blog of the Nation
The economy is not in a recession, the government is. We have no LEADERSHIP, we need a good fireside chat on the things WE with the help of good leadership can show the world. Rules put in place by the current administration allow the current oil prices etc.
To paraphrase the old axiom ("A recession is when your neighbor loses his job; a depression is when you lose yours").
"A recovery is when your CEO gets a raise. What is it called when you get one?"
For millions upon millions of American families, during the recent 6+ year economic expansion, it's a question which hasn't needed answering.
My leading indicator of a possible recession is when TOTN increasingly has "humorous" shows on our economic health....
When you rip off George Carlin, that's not a recession. When you rip off Jeff Foxworthy, that's a recession.
Oh, you mean Easterbrook's observation that, mathematically speaking, half of the country is actually doing quite well -- never mind the other half? Yes, I had a good chuckle over that one.
Just because George W Bush is the president doesn't mean you are in a recession.
If George W Bush has a 3rd term, that's when you know you're in a recession.
Leading Lipstick Indicator
Hemline is NOT a true indicator... this one IS and humorous.
An indicator based on the theory that a consumer turns to less expensive indulgences, such as lipstick, when she (or he) feels less than confident about the future. Therefore, lipstick sales tend to increase during times of economic uncertainty or a recession.
This term was coined by Leonard Lauder (chairman of Estee Lauder), who consistently found that during tough economic times, his lipstick sales went up. Believe it or not, the indicator has been quite a reliable signal of consumer attitudes over the years. For example, in the months following the September 11 terrorist attacks, lipstick sales doubled.
Here we go again. Check your donations. It's humorous if your friends and listeners are suffering, but it's a recession if your donations to NPR are down.
Why not talk about something credible with facts you can back up like the Loch Ness monster. That makes just as much of sense as your silly program on the funny side of people having to sell blood, pawn wedding rings or go hungry because they don't have the means.
Very funny, NPR. Widows selling wedding rings. You seem to be alienating what's left of your listening audience. Perhaps Esterbrook will single-handedly make all the pledges on your next drive. Lots of luck.
Seeing more houses going up for sale here in Portland, OR and staying for sale for months worries me. The high gas prices are really hurting too. It seems like years of deregulation in the banking and investment industry is starting to really hurt the national economy... or the regular joes. But, seems the investment community and oil speculators are reaping the benefits... could be what Gregg Easterbrook was talking about.
quote from my my father, who didnt graduate from H.S. "its a recession when someone else loses their job, its a depression when you lose your own job!"
The employment numbers are not a good indicator of anything. Since 2000 we have lost many good paying jobs, i.e jobs that can keep a family of 4 reasonably well off, and replaced them with more low paying jobs. The job that paid say $15 per hour in 1999 is now being paid $12 per hour. Hence, we have low unemployment but very high underemployment. We need to think more on these terms than the old terms from the last century
If I remember correctly, when they report core inflation, they don't include gas or food, due to fluctuations in price. Shouldn't they be included, particularly gas, since their prices only seem to be fluctuating UP now?
The difference in views of the economy is not hard to understand. Those that think the economy is doing well are in the upper income groups. Those that think the economy is doing poorly are in the middle and lower income groups. For the past three decades GDP gains have gone to the upper 10 percent of income recepients mostly and within that to the upper one-half of one percent mostly. While jobs are relatively plentiful, most people when they change jobs now move latterly or take a pay cut.
You can we are in recession by the number of times it (prices,layoffs, etc) come up in a general coversation. Just like the housing bubble (everyone was talking about how much their house was worth) and also the .COM boom (how much money they had made), etc
Is there not an equation of greed when a discussion of the economy is concerned?
Have we discussed the "Rubber Band Theory"? When I had my b&b, 1 of my guests presented me w/ notion that, when the economy is bad, the rubber bands around broccoli bunches @ the grocery store are thinner. When it's up, they use the thicker 1nes. Keep an eye on it!!!
Sherry Geer
Preston, CT
Consumer spending may be up, but how much of that is because prices are up? Another flawed statistic is the rate of inflation. Thirty years ago 10% inflation on a $1 item (for example gasoline) may have been 10 cents, but 4% inflation on the same item that now costs $4 is 16 cents. It's not the percentage, it's the perception.
Those stiffing credit card companies by committing suicide, that's funny. Or, little kids going to bed in this country without enough to eat and not understanding why. Oh, yeah, that's really funny.
What about all those people who didn't pay their electric heating bills because if it's below 32, it can't be shut off and now that summer's here, they're in the dark; that's funny. How about about NPR producing a responsible piece of reporting on this subject? Naw, that's too much to hope for.
This year, to dry cloths, I put up a laundry line up in the back yard, no one is sleeping in the upstairs' bedrooms in July and August (no air conditioners turned on)and I put raised vegetable beds in on the patio, to grow produce. Everywhere in the garden, I've tucked in tomatoes and other vegetables, instead of petunias & non-edible plants. The old fridge, relegated to the basement when we got a new one, has finally been retired.
I have not been greatly affected by the economic troubles. I got my first career job in February and since then I've been making more money than I ever have before. I can only imagine how things will be for me once the economy is strong again.
The previous caller who stated that a recession is determined by what people think, ie, if they think it's a recession, then it's a recession was correct but stopped a little short. People do think it's a recession because their expectations are ridiculously high. Don't believe me, how many teenagers do you know that expect to have to earn the money to buy their first car rather than have their parents provide one (of that comes with paid insurance, gas, and maintainence) My point is our expectation of what is "normal" or "average" has grown by much more than 4% a yr, that's why we see ourselves as in economic crisis. There are ligit issues to be concerned about (SS, Medicare both facing bankrupcy) but we are better off now than at any time in history. The future may be so rosy however.
I'm going to ask Georgia Public Radio to drop Talk of the Nation to save money as it's a waste of time to listen to. Now, that's funny and a smart, cost cutting move.
There is a funadamental problem with using "retail spending" to judge the health of the economy if one neglects retail price inflation. The velocity of the dollar has not slowed because the value of the dollar has weakened. We ARE paying more! More for groceries and fuels is a source of great concern and uncertainty about the futre.
Statistical analysis never seems to take into consideration the potential for further inflation on account of things like the flooding of cropland in Iowa or hyper-inflated fuel prices due to hurricanes in the Gulf of Mexico or war in Nigeria or Iran.
"People complaining about the economy" may be exhibiting uncertainty (an economic bugaboo) on account of things which cannot quantified by statistics, but can be felt in the gut.
Here is what I care about:
1. Gas prices (I am forced to commute 60 miles each way to my work with no public transportation alternatives).
2. Food prices. I am the sole breadwinner in my family and we have a small child
3. A total ineptitude and inability of this government to address any of these problems, let alone solve them.
If you're burning your propane bill to protest high gas prices, it isn't a recession. If you're burning your propane bill to keep warm, it is probably a recession.
My indicators include: no longer being able to contribute to any retirement savings, not being able to pay anything more than the minimum payment on my credit cards, having gotten rid of cable tv, being grossly underinsured, considering taking a "vacation" at home just to save the cost of getting to work and back for a week, wearing holes in my clothes, etc. Several families in my condo complex are losing their homes to foreclosure and 2 others can't sell theirs. I don't find jokes about this economy funny. I'm quite depressed by it.
i became convinced we were a in recession when some of the homeless people i serve in my job began complaining about how much less money they are getting now when they panhandle on the streets
I remember listening to that interview and being completely disgusted with his take on the situation. In particular, I thought his quoting of *averaged* per capita income figures - which completely misses the point that the rich are the only ones doing well these days - was at least disingenuous, if not deliberately dishonest. It's easy to distort the growing income disparity between rich and poor in America by glossing over the problem with a meaningless national statistic. A deeper examination shows that there is indeed little joy in Mudville.
I can tell you where the "divide" is between the doomsayers and the rose-tinted-glasses folks: it's based on whether they've lost their home or job yet.
I wonder how Mr. Easterbrook's statistics and figures would look if we considered only the bottom 95% (by net worth) of American households? I doubt he'd be able to support his notion that everything is coming up roses then.
Yes, our economy sucks, but I wouldn't want to be buying rice in bangladesh with bangladeshi wages, either
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