Recovery? What recovery?
Lots of people have just recently been talking as though the recovery in the US had been going on for two years. Not that anyone was celebrating, what with unemployment so high. Even so, I have no idea where that notion of recovery came from or what data it was based on, yet international organisations and other institutions seemed to have made up their minds. And many journalists and economic commentators seemed happy with that and took their cue from a few official press releases. In reality, the economy in the western world has been in fairly bad shape at least since Lehman's fall in 2008, and probably earlier than that.
So it was a major surprise to me to see so many headlines in July talking about a second anniversary of the end of the recession.
eg "This Recovery May Be Two Years Old, But We're Still At Recession Levels Of New Unemployment Claims", wrote Mike Shedlock, 30 June 2011
http://www.businessinsider.com/new-unemployment-claims-recession-levels-2011-6
"U.S. Recovery's 2-Year Anniversary Arrives With Little To Celebrate" says Huffington Post, 1 July 2011
http://www.huffingtonpost.com/2011/07/01/economic-recovery-anniversary_n_888979.html
Thankfully, former IMF boss Kenneth Rogoff has not only put an end to the birthday party, but reminds us that the crisis is not three, but four years old...Fanny Mae and Freddy Mac, Hypo bank in Germany and Northern Rock in the UK all hit turbulence in 2007. I remember, I was going to a rugby world cup game in Paris between England and South Africa when the news broke about Northern Rock. Well done Ken.
"Four years into the financial crisis, it is becoming increasingly clear that the biggest deficit is not in credit, but credibility." Kenneth Rogoff, 9 Aug 2011
http://www.ft.com/cms/s/0/1e0f0efe-c1a9-11e0-acb3-00144feabdc0.html#ixzz1UWeEV2Xf
And I see Paul Krugman has also added his weight to the show, saying the US never really was on a recovery path in the first place.
©RJ Doyle/Real Terms 9 August 2011
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