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Recession over According to Experts

In what is likely to be much happier news than the release of the new Range Rover Evoque for most Americans, according to the testimony of experts, the so called Great Recession is over, and actually has been for a number of months. The Business Cycle Dating Committee, a group that analyzes disparate financial data to determine the starts and stops of such cycles, has pronounced the recession over as of June 2009. According to their earlier work, the Committee had determined that the cycle had begun in January of 2008, meaning that even with the recession over it was still noteworthy to find that it lasted a full 18 months, the longest such period since World War II [1].

Length of Great Recession

Now that it is over, it seems that there are multiple groups who wish to study this recent historical period and glean all that they can from it. Of particular interest is this notion of the length of time in which it lasted. For normal people who are still looking for work and having a hard time paying for their car insurance despite a free auto insurance quote, these facts and figures might not have all that much significance. But to those who study these trends, they can be very powerful because the more we know about these cycles, the more accurately we might be able to predict the next boom period or get ready for future downturns down the line. There are many reasons why it is important for some people to know when to call the recession over. But most of them are for statistical and other research purposes.

Potential Harm of Recession Pronouncement

There is, however, some reason for caution to be warranted when these matters go on and announcements are made. Hearing that the recession is over and has been for some time can do two things to people. On one hand, it might give them a false sense of hope that things are better than they really are. All the pronouncement means (if it is actually found accurate over time) is that the economy hit rock bottom and stopped contracting in June of 2009. It does not mean we have made it through the rough patch by any means.

The other danger to this type of recession talk is the tendency for folks who don't know any better to think that the recovery somehow passed them over and that they are stuck in neutral while everyone else is already over their woes and back in business. Either of these reactions is possible and both quite typically follow these types of announcements. It is fun and even useful to pore over economic indicators and determine peak and trough points for the national economy. But for the general public, the significance of finding out that the recession is over can cause inappropriate responses because most of us have no idea what to do with this information. We need the experts to not only announce the results, but to put them in plain terms.

With the recession over and the economic path to recovery underway across the country and even the world, there is no doubt that consumers can use all the good news that is out there. But hearing scientific information about the duration and start and stop times of the recession for most of us is like hearing some sort of code we can't crack. Normal folks like us hear this news and might be apt to think we should go buy a new car or something. But even with the recession over there is obviously still a lot that needs to be done and a long road ahead yet.

[1] http://online.barrons.com/article/SB50001424052970203514704575509770592414534.html?mod=googlenews_barrons Retrieved 2010-09-25.

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