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January 11, 2010 |
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This article by Bill Hester of Hussman Funds is about how the data normally looks at the end of recessions is interesting. What is particularly important to look at is how tepid the economic recovery has been in "real personal income less transfer payments". This is private income before counting government payments to people. Additionally, the recovery in jobs is certainly making the call about when this recession is considered finished much more difficult. This recovery is not obvious when you look at the data. This is backed up in another article from Bloomberg that expresses the views of respected economist Martin Feldstein of Harvard University, the former head of the independent committee that dates when recessions begin and end. Regardless, the dating of when a recession technically ends is very, very different than making a judgment about how strong that recovery will eventually be. This determination will help in evaluating the sustainability of the hopeful stock market rally since March ’09. We, of course, have our doubts.
