Recession? I say hogwash
You’d be hardpressed to find anything in the media where some financial ‘expert’ isn’t screaming ‘recession.’ I have to question their expertise. I watched Larry King Live last Thursday, in which he had a panel of these financial ‘experts’ (Gerri Willis, CNN Personal Finance Editor, Kim Kiyosaki, Author “Rich Women: A Book on Investing”, Jean Chatzky, Author “Make Money, Not Excuses” ) crying chicken little about the coming recession. Some even argued that we were already in a recession. Let’s take a look at what a recession actually is and why the U.S. isn’t in a recession?
According to Dictionary.com, “the technical indicator of a recession is two consecutive quarters of negative economic growth as measured by a country’s GDP.” Going with that definition, I headed over to the Bureau of Economic Analysis to see what these statistics actually implied over the last quarters of 2007. I found the following interesting and to the contrary of what the media is telling Americans:
“Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 4.9 percent in the third quarter of 2007, according to final estimates released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 3.8 percent.”
We can all agree that the economic growth rate is slow, but even the Federal Reserve Chairman, Ben Bernanke, in a statement that same Thursday said, “the U.S. economy is not facing a recession, but will suffer from slower growth for at least a year.”
So who are we to believe? The media and politicians? Or the statistics?
Entry filed under: Soap Box. Tags: .