RSSGraphing the recession
Feb 10
I love graphs. Maybe it’s a geek thing.
Anyways, I ran into a few graphs of job losses in this recession. I believe the first two are produced by the US government and the last is sourced in the image. All were found via DailyKos.
I saw this one first, and it scared me:
The slope of that line is definitely scary. If jobs keep being lost at that rate for the next quarter I’d guess we’re in for a whole lot of trouble.
Next, I ran into the graph below. When the other post-WW2 recessions are plotted this one still looks very bad:
However, it seems someone was smart enough to plot the job loss data as a percentage of population. Now this recessions looks fairly mediocre.
This graph makes me feel pretty good, actually. This is a small indication that we’re not closing in (yet) on depression-level disaster.
One caveat is that the definition of job losses has changed over the years, and I’m not sure if these graphs take that into account.
Feb 10, 2009 @ 08:45:06
Job losses aren’t the only issue in an recession, also the slope seems to be increasingly negative on the current trend where others didn’t drop as fast. Perhaps it would be worth comparing to pre WWII recessions (if the data’s there).
Feb 10, 2009 @ 09:50:38
Well, I looked up what the economic indicators of a depression are just to get a sense of the differences between depression/recession are.
Though there is no widely accepted definition for an economic depression, according to an article in The Economist, there are two rules of thumb found widely on the internet. One is a decline in real GDP exceeding 10%, and the other is a recession lasting 3 or more years.
Anyway, I checked wiki and they provided 3 depressions:
Great Depression
Main article: Great Depression
The most well-known depression is the Great Depression that affected most of the economies in the world throughout the 1930s. The depression began during the Wall Street Crash of 1929, and the crisis quickly spread to most national economies.[5] High deflation caused a further deepening of the depression.[citation needed]
A long-term effect of the Great Depression has been the departure of every major currency from the Gold Standard.[citation needed]
[edit] Long Depression
Main article: Long Depression
The Long Depression, known at the time as the “Great Depression”, lasted from about 1873 to 1896.[6] It affected much of the world and was contemporaneous with the Second Industrial Revolution.
[edit] Panic of 1837
Main article: Panic of 1837
The Panic of 1837 was an American financial crisis, built on a speculative real estate market [7]. The bubble burst on May 10, 1837 in New York City, when every bank stopped payment in gold and silver coinage. The Panic was followed by a five-year depression[8], with the failure of banks and record high unemployment levels[citation needed].
I agree with Ian, that the slope is so important – the shedding is so huge the slope is like a landslide. That’s a very bad omen.
Feb 10, 2009 @ 10:05:35
I think you’re both correct, and thanks for the examples jan. I’m a bit surprised the definition of depression is only a 10% drop in GDP.
The slope of the line is very worrying. However, one thing to keep in mind is that given how much faster information (and money) flows these days, I don’t think it’s surprising we see the symptoms so much quicker. The Great Depression apparently took a few years to fully develop.
Maybe I’m grasping at straws, but I’m trying to stay as optimistic as I can. The sheer complexity and inability to predict global macroeconomics is why I find it so interesting.
Further, whether or not it’s a good idea, I believe the US will spend (borrow) enough money to dampen this recession, simply because it makes political sense.
But, if the slope of that line continues for the next quarter I don’t think I could stay optimistic.