The Glade 4.0

Not to side with chicken little, but this chart is valued in US dollars. Try adjusting it by a real inflation rate that takes into account the cost of essential goods not normally counted in the official inflation rate. I'd be curious what happens to it.

Edit: Hell, show it "per capita," too. Adjusting for population is a better indicator than overall production.

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That does not appear to be consistent with the graph you just posted. The graph you posted shows growth at approximately pre-2007 levels. So whether you call it a depression or a recession, according to your graph, it appears to be over.

Depressions don't miraculously end with growth. If they did, then the Great Depression was just a double dip recession (and fairly mild at that). Also, assuming I agree entirely with Shadowstats.com for simplicity's sake; less contraction is not growth.

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Arathain, that's year-to-year growth. So when the blue line is higher now than in 2007, that just means our downward trend has slowed.

Learn to integrate, fool!

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

You said that with a Mr. T voice, right? Or is that just in my head?

according to this definition:



I guess you're right. We should start importing puppies and Zoloft immediately.

...

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Heh. I know that. Recessions are just about growth, though, are they not? So, technically, you are out of the recession at the low point?

I know depressions are not handled that way.

No. You could have two or three years of contracting GDP coupled with population, standing of living, wealth, and employment increases and not be in a recession.No. Under the "popular" definition of a recession (3 or more quarters of sustained economic contraction), you're out of a recession when you post at least 2 consecutive quarters of positive growth.

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I'm just a dumb hick from a logging town with slight accounting background, but shouldn't, in the aggregate, both methods converge on the same number (assuming both use the same base data)? If the immobile inventory is held as an asset, it should be depreciated over some term of years, the depreciation of all held inventory over those years showing as a decrease in output. If held to be a liability, the depreciation would show as a decrease in the decrease in output--essentially a gain in output. Or am I overthinking this?

Yes, recessions are about growth, as commonly defined. So they're over when you start growing (positive growth -- notice, Khross' graph indicates we're still in the negatives) again -- because crossing the 0 means that the GDP has passed its low point.

Again, you're mixing up two graphs -- one graph is GDP by year, the other is GDP growth by year. The low point in the GDP graph is going to have a 0 on the growth graph as it crosses from negative to positive growth.

Again, learn to derive, fool!

(And, yes, RD -- go ahead and say it to yourself in a Mr. T voice)

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

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Buckle your pants or they might fall down.

Yes, I know this. And no, I'm not mixing up the graphs. This is pretty obvious, but thanks. Like I said, GROWTH is at pre-2007 levels, based on Khross's graph. Since I said GROWTH, and the chart is showing GROWTH, there's no need to integrate. If I had said TOTAL, and the chart said GROWTH, then yes, I would need to integrate.

Thanks for the tip, Coro, but it's not needed. Knowing what it is doesn't help, you also have to know when to apply it. Or, read what was written.

Okay, let's pull the image back up so it's on this page.



I don't see how you're getting that the recession has ended, using *anybody's* definition of recessions, by saying that our economy is declining at a rate consistent with 2007. All that argument leads to is that we were already IN one then, going back to 2004 or thereabouts, but we're supposed to be happy we've climbed our way back up to "mild" decline, and declare ourselves victorious.

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

I think I see the confusion. I was just focusing on the "official" (red line) that shows we had positive growth in 2007 and today (around 2%). It only shows 2009 (roughly) with negative growth.

I'm not familiar with "SGS", and focused on the official based on this statement:



Only the red line shows positive growth in 2007, so my eyes were drawn there (yes, I know recession and depression are not interchangeable).

EDIT: Or is this change in growth, not growth? Maybe that's where we're not on the same page?

The blue line is the year to year GDP growth as calculated by a site called Shadowstats.com. The red line is the official BLS figures.

The bulk of their efforts revolves around "correcting" US Government issued statistics; for example, they "correct" CPI inflation indicators to use consistent baskets of goods. They also publicize frequently downplayed or under-referenced (like the U6) employment figures, and make estimates to include "long-term discouraged workers, who were defined out of official existence in 1994" in their own unemployment index.

The guy who runs the site is written off as a conspiracy theorist by some, but most of his criticisms are sound, even if you don't buy into the methodologies he uses to generate his data.

In any event, I find that his data better represents my perceptions on the ground than BLS data does. Is it confirmation bias? I can't rule that out as a possibility, but the rejiggering the country's done with all manner of statistics calculation (not to mention the fuzzy logic frequently applied) definitely leaves room to be skeptical of their data, too.

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

This I can work with. Lets assume we do have Great Depression era numbers combined with high inflation. Can you think of how the US economy is different than it was in 1929 and extrapolate what that means under sustained depressed wages, high inflation, and rampant unemployment?

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"...but there exists also in the human heart a depraved taste for equality, which impels the weak to attempt to lower the powerful to their own level and reduces men to prefer equality in slavery to inequality with freedom." - De Tocqueville

For one thing, there's not going to be another Dust Bowl leading to widespread hunger and large-scale displacement of the population.

Ok lets look at food generation. How much of a decrease would inability to access petroleum based fertilizer cause? What if we exhaust the water resources (we are already depleting the major aquifer much of the Midwest draws from for water. What about if purchasing costs become prohibitive for re-seeding (since almost no larges scale farm uses seed that can re-seed itself due to GM to copyright the seed)? Say its not so bad but all of those plus increase transportation costs have food rise by 3 or 4 times what they are now over a few years - couple this with strong inflation (not even runaway) and how are people living on SS going to eat - how are those who depend on government cards going to eat (since they are both always grossly underadjusted for inflation)?

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"...but there exists also in the human heart a depraved taste for equality, which impels the weak to attempt to lower the powerful to their own level and reduces men to prefer equality in slavery to inequality with freedom." - De Tocqueville

@ Kaffis

Your post doesn't sound real confident in the data source. I see lots of sources of horrifying data, each of which is questionable without research.

I dont' have enough data to really put any stock into these.

That's your prerogative, of course.

That said, the CPI adjustments are pretty concrete -- it's simply a matter of removing changes that have been made (arbitrary depreciations to account for "increased value" that result in, for example, the CPI essentially contending that the price of buying a car has gone down over the past 20 years, sticker price be damned; removing the assumption that consumers will substitute cheaper items when CPI basket items go up in price, like buying round steak instead of porterhouse because porterhouse got more expensive, etc.).

So I'd say the CPI *numbers* are pretty much without reproach (in that nobody's arguing with the guy that if you don't change the metrics, the numbers come out to something different than what he claims), the only disagreement is whether the adjustments made by varying rounds of legislation are really beneficial to measuring the indices.

Given that the GDP numbers the site calculates are based off of his CPI adjustments (it's a straight "reverse engineer their inflation adjustments and apply my inflation adjustments" scenario), any dispute with the GDP numbers are similarly cut and dry.

Now, I do agree that his unemployment numbers are a bit more fuzzy, as that requires original research to get the estimates, and I haven't subscribed so I don't know if he includes data collection methodologies for that, or what kind of sample sizes he uses.

So, since we're not talking about his unemployment figures, maybe we should discuss the merits of the adjustments Congress legislated into the CPI, vs. the merits of using a fixed standard.

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"Aaaah! Emotions are weird!" - Amdee
"... Mirrorshades prevent the forces of normalcy from realizing that one is crazed and possibly dangerous. They are the symbol of the sun-staring visionary, the biker, the rocker, the policeman, and similar outlaws." - Bruce Sterling, preface to Mirrorshades

You'd be correct if our government used actual accounting practices in their calculations; however, surplus inventory isn't held at production, it's held at retail value at the time of production. This skews things dramatically, especially as our general business and accounting practices have shifted to deal with "just-in-time" receipts, deliveries, and production. Of course, we're also talking about calculations that double-dip on leveraged items as well. For instance, if General Motors borrows $1.5 billion from J.P. Morgan Chase, GM gets to count that $1.5 billion as in year revenue. If the $1.5 billion was used to purchase property, it gets to be held in the asset column, while only the interest shows as an in year loss.

Basically, we don't the keep books right anymore.

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There's already widespread hunger in the United States, which incidentally demonstrates the flaws in the social safety net you argue is absolutely necessary.

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But but but it would be WORSE if we didn't have these! I mean look at Africa! *quivering lip and doe eyes*

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A man who has nothing for which he is willing to fight, nothing which is more important than his own personal safety, is a miserable creature and has no chance of being free unless made and kept so by the exertions of better men than himself. ~ John Stuart Mill