patrick.net

Define depression besides the usual greater than 2(?) consecutive quarters of negative GDP. Isn't a record number of out of the labor force workers a hallmark?

Obama is still the president, he should get on it asap.

Recession is 2 or more consecutive quarters of declining GDP.

Depression can = years of declining GDP growth.

Just clarifying.

AllTruth says

Depression can = years of declining GDP growth

Muchly appreciated and corrected.

ohomen171 says

Great Depression 2 If Trump Doesn't Act

Great Depression 2 3 If Trump Doesn't Act

You forgot about the Great Depression of 2007 to 2015. And that's assuming you can make a compelling case that we've fully recovered from that depression.

Jobs are mostly back, but they aren't paying as much.

Ironman says

Blurtman says

Define depression

The poster in the OP won't respond, so give up trying. He's a worse SpamBot than TovBot is...

I'm going to pull the giant Parrot pic on his ass, too.

Squawk!

There is no recession or depression.
The market is at record highs.
That's the only thing that matters to the economy for
DUMBASSES like me!

AllTruth says

Recession is 2 or more consecutive quarters of declining GDP.

Depression can = years of declining GDP growth.

Just clarifying.

Your clarification is misleading. Yes, a recession is defined as two or more consecutive quarters of declining GDP. And this makes the word recession utterly worthless as the economy can be doing awesomely well during a depression and terrible while not in a depression. If the GDP increased a million fold and then lowered by 1% geometrically every year for a century, you'd had a century of awesomely good prosperity and the end would still be 366,032 times more GDP than what you started at in the first year. Give me that kind of recession!

Yet, if the GDP were to fall 99% in one quarter and rise 1% geometrically every year, then you would have an entire century without recession, but you would be in a constant depression and life would suck. At the end of the century your GDP would still only be 2.6780335% of the GDP in the first year.

The word recession was defined deliberately to hide bad economics and it works at that by making it highly unlikely that any recession will last more than a year. Think about it. If the GDP changes were -1%, -2%, +0.1%, -5%, -3%, +1%, -10%, -4%, 0%, -6%, -3%, +1% then no recession lasts for more than two quarters. Would you consider this a good economy? The only purpose of the word recession is to obfuscate this bad trend so that the negative expectations don't keep the economy down. That's it. It's a word to deceive people into thinking the economy is doing better so that they will spend more and hopefully make the economy better in a self-fulfilling prophecy. Of course, if it fails to do so, any fool listening to the message gets fleeced.

The word depression is meaningful and useful. However, it does not mean what you say it means. A depression is a prolong period of lower productivity. The GDP can be rising throughout a depression as my first example shows. Similarly, the GDP can be falling during a time of economic prosperity as my second example shows. The media and financial industry refuse to use the word depression because they are trying to manipulate the emotional sentiment of the general population including investors, speculators, and consumers. This is why they refer to the Great Depression of 2007 as Recession 2.0 instead of the Second Great Depression.

The use of "2.0" is also bullshit that the clueless reporters and commenters use to make them sound cool. To anyone intelligent, they sound like dumb asses because depressions don't have minor version numbers. What the fuck would be the Great Depression 1.1 or 1.2? Meaningless nonsense used to make one appear tech swavy when one is really clueless. Minor version numbers have actual meaning in software. They typically refer to updates of existing products with bug fixes and performance improvements but no major new functionality. When new features are offered, the major version number increases. This convention does not apply to most things including marking historical events. So using the term improperly demonstrates ignorance on whatever subject you are discussing. It also shows bad values in that you prefer a facade over deep, clear, and accurate understanding of a subject.

It means precisely what he stated:

"In economics, a depression is a sustained, long-term downturn in economic activity in one or more economies. It is a more severe downturn than an economic recession, which is a slowdown in economic activity over the course of a normal business cycle."

freespeechforever says

It means precisely what he stated:

"In economics, a depression is a sustained, long-term downturn in economic activity in one or more economies. It is a more severe downturn than an economic recession, which is a slowdown in economic activity over the course of a normal business cycle."

1. That is not what he said.
2. That is not correct.

It is meaningless to say that a depression is more severe than a recession as you aren't measuring the same thing in each case. A depression is a measurement of the economic output whereas a recession is a litmus test, maybe a scalable measurement, of the change in economic output from one quarter to another. To compare the two would be like comparing a function to its derivative and saying one is larger than the other even though they return incompatible units. For example, saying that 10 watts is greater than 5 joules or that 10 watts is less than 20 joules simply because your units in one uses a bigger number. This is completely fucking meaningless. What happens if you switch from measuring energy in joules to calories? The numbers change. What if you change the unit of time from Earth seconds to Martian seconds or from meters to feet? Again, the numbers change.

The words depression and recession where designed to mean completely different and unrelated things.

You can have rising GDP with continual job loss and lowered standard of living.

Blurtman says

You can have rising GDP with continual job loss and lowered standard of living.

That's true, but it's not a depression. It's income and wealth inequality, and those are different problems with different solutions.

Dan, you are clueless.

Please describe the technical definition of "depression" for us not up to par.

k thnx

freespeechforever says

Dan, you are clueless.

No kidding.

A depression will happen when we stop increasing the debt.
If we act now, we get it now.
If we act later, we get it later.

We're really at a tipping point; conservatives guestimates have global debt at 300 trillion dollars, or 300% of global GDP.

But that's not the worst of the story, due to financialization of all things globally -

http://thezman.com/wordpress/?p=9158

- "The result is an unsolvable conflict. On the one had we have a financial system demanding ever more high quality debt, in order to drive growth in asset values. On the other hand, we have a retail economy demanding more cash moving around in the system in order to stimulate economic growth. It’s why smart guys like James Rickards see a financial crisis in the near future. The methods to paper over this inherent conflict are just a delaying action. At some point, the pressure exceeds the restraints and you get a crisis.

An organized unwinding of trillions in debt is never going to happen, so that means we will have a disorganized unwinding of trillions in debt. That’s the definition of a crisis. It is the unexpected, disorganized unraveling of something that probably should never have been allowed to happen. The mortgage crisis is the most recent example. Lending billions to people, who have no way to repay the loans, turned out to be a bad idea. In the fullness of time, the mortgage crisis will be seen as a warning, one everyone ignored."

freespeechforever says

Dan, you are clueless. Please describe the technical definition of "depression" for us not up to par.

If that's the best counter-argument you can make, then you lose.

freespeechforever says

Please describe the technical definition of "depression" for us not up to par.

You don't have to get technical. The word depression is something that's been around for over a hundred and fifty years. The common man has long used this word and there's tons of literature dating back to at least the 19th century regarding depressions. Hell, you learned this shit back in elementary school and again in high school. It's not rocket science.

Quite frankly, you shouldn't give a shit where a fact or idea comes from. The messenger is irrelevant. You are obsessing on who said it rather than what was said and what evidence supports it. Quit being so ego-centric. Be idea-centric.

[Must break due to stupid comment limit.]

[continue]

Here are the textbook definitions from well-respected dictionaries.

Merriam Webster

a period of low general economic activity marked especially by rising levels of unemployment

Cambridge

a period in which there is very little business activity and little employment:

Macmillan

a period of time when there is a lot of unemployment and poverty because there is very little economic activity

Oxford

A long and severe recession in an economy or market

Britannica

Depression, in economics, major downswing in the business cycle that is characterized by sharply reduced industrial production, widespread unemployment, serious declines or cessations of growth in construction activity, and great reductions in international trade and capital movements.

Collins

an economic condition characterized by substantial and protracted unemployment, low output and investment, etc; slump

So there you have six highly respected sources on the meaning of the word depression. Five of them say exactly what I said. One of them said what you said, and I can easily argue that the one detractor is just plain wrong and explain why, which is what I will do now.

[break]

The Oxford dictionary entry reflects how people misuse the word depression, not its correct and important meaning for the following reasons.

1. The word depression (in economics) predates the word repression by more than a hundred years. Therefore, it is impossible to define the word depression in terms of the word recession. It's meaning must be independent unless there are time-traveling dictionary authors.

2. By Oxford's definition, it is impossible for a depression to occur without continuous declines in GDP in order to first meet the definition of recession. Therefore, the Great Depression was not a depression according to this definition. Go try to argue that the Great Depression wasn't a depression. Go on...

Quarterly figures for the 1930s aren't available, but we can infer from the yearly figures and obvious math that a third grader could understand, that the Great Depression (1929-1940) wasn't even a recession for the vast majority of years, nonetheless a single, severe recession like the Oxford dictionary requires.

https://www.bogleheads.org/forum/viewtopic.php?t=57188

Annual Real GDP Growth Rates
Year 1930 1931 1932 1933 1934 1935 1936 1937
%grw -8.6 -6.5 -13.1 -1.3 10.9 8.9 13.0 5.1

Year 1938 1939 1940 1941 1942 1943 1944 1945
%grw -3.4 8.1 8.8 17.1 18.5 16.4 8.1 -1.1

Only the years from the end of 1930 to 1933 meet the definition of a recession. After that there was near continuous growth. Sure you might have had one or two technical more interviewing recessions, but they would still be separate from the recession from 1930 to 1933, and overall growth was strongly positive during the Great Depression form 1934 to 1940 with only one year having declines.

According to the Oxford definition, and yours, 70% of the Great Depression was not a depression. Yet by any reasonable consideration, it was.

[continue]

4. By the Oxford definition, and what you are proposing, if the GDP were to drop by 100% and all commerce stopped and never stared again, that would be neither a depression nor a recession. After all, it's just one quarter of falling GDP. Every other quarter has exactly 0% growth, which is not negative.

Even if the GDP of the entire country was only one dollar in today's money, this would not constitute a depression according to your proposal. As such, your proposal is ridiculous.

Sometimes, you just have to accept common sense on everyday human experiences.

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