Scribbles

[Bryan (a.k.a. Bryan)]

RECESSION - It's official.

The Business-Cycle Peak of March 2001
Business Cycle Dating Committee, National Bureau of Economic Research

http://www.nber.org/cycles/november2001/recessnov.html

November 26, 2001

The NBER's Business Cycle Dating Committee has determined that a peak in business activity occurred in the U.S. economy in March 2001. A peak marks the end of an expansion and the beginning of a recession. The determination of a peak date in March is thus a determination that the expansion that began in March 1991 ended in March 2001 and a recession began. The expansion lasted exactly 10 years, the longest in the NBER's chronology.

The committee is satisfied that the total contraction in the economy is sufficient to merit the determination that a recession is underway. The committee makes this determination by asking itself hypothetically what decision it would make if a turnaround in the economy started just after the most recently observed data. If, despite such a turnaround, the episode would qualify as a recession, the committee moves ahead to the second step, the determination of the date of the peak. Prior to the arrival of the data for October 2001, the committee was not sure that the contraction met the criterion. With a cumulative decline in employment approaching one percent and the very large decline in industrial production, the committee has concluded that the criterion has been met now.


Figure 1. Current Employment
The dark line shows the movement of employment in 1999-2001 and the dashed line the average over the past 6 recessions.


Figure 2. Current Industrial Production
The dark line shows the movement of industrial production in 1999-2001 and the dashed line the average over the past 6 recessions.


Figure 3. Real Manufacturing and Trade Sales
The dark line shows the movement of manufacturing and trade in 1999-2001 and the dashed line the average over the past 6 recessions.
Source: The Conference Board (http://www.globalindicators.org)


Figure 4. Current Real Personal Income Less Transfers
The dark line shows the movement of income in 1999-2001 and the dashed line the average over the past 6 recessions.
Source: The Conference Board (http://www.globalindicators.org)

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