NP - The Myth of a Jobless Recovery

[alice wellintown]

http://www.businessinsider.com/reinhart-rogoff-white-paper-2012-10


On Thursday, January 10, 2013, alice wellintown wrote:

> When pressed to give a specific definition of recession, or depression,
> economists often focus on employment. So, most would agree that the recent
> recession was not a depression, but came close; if unemployment were 3-4
> points higher...well...all else being equal, it would be hard to defend the
> recession characterization. That phrase, all else being equal, is useful to
> economists and they use it a lot to make simple models, and even complex
> models, but, if unemployment were 3-;4 points higher, all else would no be
> equal. The recovery or expansion phase of the business cycle is defined as
> a rise in output and employment. But, we must consider, from what we are
> recovering. When an economy goes through recovery after a financial crisis
> recession, such as the late 2000 great contraction,it's recovery is slow
> and weak. So, although we have output growth and a decline in unemployment,
> it is, while not jobless, weak. We did avoid the double dip and are
> actually in what is called a second recovery. With rates at zero, there is
> little we can do from the Fed to improve employment, but, what has been
> done is working, the economy is a coiled spring and, looks, though still
> wounded, ready to spring into action. The natural rate of employment is
> now, I suspect, about 6.5, so we are getting there. My point is that we do
> not have a jobless recovery. We have recovery, second recovery with no
> double dip recession, but it is common that recovery from this type of
> recession is slow and weak, thus job creation does not recover nor does
> output in the v pattern of normal recessions, but more in the long bottom u
> pattern we are seeing. The good news, we are going up. Inflation is not a
> concern. Money is cheap. Markets are on solid ground. Even housing is
> improved. And, for the liberals with a conscience, the rich, the creditors
> and investors in fixed securities are being taxed with low rates, financial
> repression, the slight and, bursts of inflation, will bail out the debtors,
> the poor and ordinary, are getting their bail out.
>
> On Wednesday, January 9, 2013, David Morris wrote:
>
>> Common and uncommon are useless adjectives without definition, especially
>> when arguing about subjects like Economics. Get Fcking specific! Otherwise
>> you have no real point. Just diversion.  Part of the problem.
>>
>> David Morris
>>
>> On Wednesday, January 9, 2013, alice wellintown wrote:
>>
>>> Agreed. one might define recovery as "I'm doing better" but this is not
>>> very useful, so generally, people use the terms recovery and expansion
>>> to mean employment and output are rising.
>>>
>>> From what?
>>>
>>> From a great contraction. This time, as the book by r&r makes clear, is
>>> not different. It's great, it's a major financial crisis driven recession,
>>> but unfortunately, not quite common when we look at the economies round the
>>> globe through history.
>>>
>>> On Wednesday, January 9, 2013, Bekah wrote:
>>>
>>>> This is probably saying the same thing but it seems to me a person
>>>> could define "recovery" any old way they wanted.   If you base the numbers
>>>> on the stock market and GNP or a couple other indicators,   who cares about
>>>> jobs and median family income?   Or you could count everything but assign
>>>> different rankings to each factor.  Or you could use the numbers from the
>>>> above to automatically project job creation with no evidence.
>>>>
>>>> And then too,   what does "recovery" mean in terms of end result -  are
>>>>  we recovered back to where we were at some peak economic performance?  Or
>>>> back to some kind of average for the last couple decades or century or
>>>> whatever?
>>>>
>>>> I think we're still economically ailing.   What would we be if we had
>>>> 1% unemployment (due to self-sufficient farming and handi-man/barter stuff
>>>> or something)  and the stock market was crashing?  I'll bet there are those
>>>> who would consider that a serious, serious depression.
>>>>
>>>>
>>>> Bekah
>>>>
>>>> On Jan 9, 2013, at 10:22 AM, alice wellintown <
>>>> alicewellintown at gmail.com> wrote:
>>>>
>>>> > We can define and measure recovery, itz not rocket science, we simply
>>>> > look at the charts and graphs and there it is;  or there it isn't.
>>>> > itz so easy,  that even an economist can do it.
>>>> >
>>>> > But not all recoveries look alike because not all recessions look
>>>> > alike. The one the US is now recovering from, while not unique, is
>>>> > uncommon.  It is a major financial crisis recovery.
>>>> >
>>>> > And, it is common to have a slow, pathetic to moderate, recovery, one
>>>> > that moves back to natural unemployment slowly, after such a crisis.
>>>> > That's what we have.
>>>> >
>>>> > Some call it a jobless recovery and this phrase is not accurate,
>>>> > although the nitty gritty splceres of date aind indicators may make
>>>> > arguements about the particulars....but it does say something about
>>>> > the recovery from these kinds of financial crises, that is, they are
>>>> > not easily shaken off and they do damage to employment, damage that
>>>> > takes up to a decade, in the best of circumstances (ours is not the
>>>> > best but relatively very good), or longer to repair. Of course, for
>>>> > some workers, and groups, the dmage can not be repaired. There are a
>>>> > hundred variables, some of them singular and local, but the nutz and
>>>> > boltz of it are simple enough.
>>>> >
>>>> >
>>>> > So, how tro avoid this next time? We can't. WE might try what the
>>>> > Brits are doing, or whatever, but in America we like risk and we will
>>>> > take the chances, de-regulate and find ways to make money.
>>>> >
>>>> > The good news is that those in debt are being helped and those who
>>>> > have lotz of money are bing taxed to help them. A good policy, if kept
>>>> > in check,  in the long run.
>>>>
>>>>
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