“Newly released data from the Commerce Department show what some people have been saying for months: The nation is in recession.”
That’s , writing in September 2022. A cautionary note on declaring recessions.
Furthermore, the Biden administration’s cherry-picking of data has come back to bite it, with even its selected data points now being revised to indicate a recession. And while these numbers confirm the economy shrank in the first half of the year, the rest of this year holds little promise of recovery.
Just a reminder of what data we know now about 2022H1, and what happened subsequently.
Figure 1: Nonfarm Payroll employment (bold dark blue), Bloomberg consensus of 2/1 (blue +), civilian employment (orange), industrial production (red), personal income excluding current transfers in Ch.2017$ (bold green), manufacturing and trade sales in Ch.2017$ (black), consumption in Ch.2017$ (light blue), and monthly GDP in Ch.2017$ (pink), GDP, 2023Q4 advance release (blue bars), all log normalized to 2021M11=0. Hypothesized 2022H1 recession shaded light blue. Source: BEA, BLS via FRED, Federal Reserve, 2023Q4 advance release,, (nee Macroeconomic Advisers, IHS Markit) (2/1/2024 release), and author’s calculations.
What about the Sahm rule (real time)?
Figure 2: Real time Sahm rule indicator, in % (blue). Threshold denoted by red dashed line. Putative peak-to-trough recession of 2022H1 shaded lilac. Source: FRED.
And, recalling that NBER’s BCDC doesn’t place primary reliance on GDP, here are other measures of output.
Figure 3: GDP (blue), GDO (tan), and GDP+ (green), final sales (red), all in bn.Ch.2017$ SAAR. GDP+ assumes 2019Q4 GDP+ equals GDP. Hypothesized 2022H1 recession shaded light blue. Source: BEA 2023Q4 advance estimate, , and author’s calculations.
So, now , as of several weeks ago. He might end up being right. As of yesterday, , the Lewis-Mertens-Stock Weekly Economic Index is running at 2.37%.More By This Author:Nowcasts RisingState Employment Report For August Is Manufacturing In Recession?
