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A general rule of thumb, only. It much more complex than that, and has been determine by the NBER's Business Cycle Dating Committee for as long as I've been alive. It hasn't changed.
It isn’t the actual way it works. Google it. It never has been just 2 quarters
The NBER's definition of a recession takes into account monthly indicators like employment, personal income, and industrial production along with quarterly GDP growth, and two consecutive quarters of negative GDP growth often, but not always, correspond with an official recession.)
We have never been in a recession with practically full employment
And all those #s look good except for inflation. If anything we look like we might be in a situation like the 1960s when unemployment was too low. That caused inflation.
The latest jobs report shows that the U.S. labor market is in decent shape, but Bank of America sees trouble looming in the distance.
In December 2022, total nonfarm payroll employment rose by 223,000, beating economists’ expectation of a 200,000 increase. It also means that America’s job growth is heading in the right direction.
Bank of America, however, expects nonfarm payroll gains to turn negative this year. During the first quarter of 2023, the bank projects that the U.S. will be losing roughly 175,000 jobs a month.
And it’s not just the labor market that’s going to take a hit.
“We are looking for a recession to begin in the first half of next year,” Bank of America’s head of U.S. economics Michael Gapen told CNN last October.
“The premise is a harder landing rather than a softer one.”
They expect a complete reversal of the labor market and their prediction is based on "reasons," mainly the interest rate expected to go to 4.6%. The BofA economist thinks that will make the u/e rate go up to around 5%. Based on what???
We have been waiting on this recession for almost 2 years now. Don't get me wrong, I welcome it. Anything that brings down housing prices is good in my book. But I am not confident a recession is coming at all.
So much for you and others wringing their hands about Dow, 3M and some tech company layoffs. The January jobs report was released a half hour ago and the labor market shattered expectations in January, as the economy added 517,000 jobs, despite those layoffs. The expectation had been only 189,000 jobs added last month.
Yet new numbers are stating unemployment lowest since Jimi Hendrix played at Woodstock.
Isn't raising rates supposed to increase this figure?.
It can take years for rate changes to work its way through .
Unemployment is a lagging indicator…it is at the end of the food chain when money works it’s way in or out of the economy
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