Are we in a Recession or a Depression?

[BigmanPigman]

I'm not an economist but what are the guidelines for determining our current economic status and our near future status? Does it even make a difference? Is it just a label these days? Is the tRump admin. able to dictate actual or false economic statistics?

[ananda]

1. It's hard to tell when a corrupt

government and nedia are in charge of the messaging.

[Skittles]

2. and the numbers

yes indeed

[biophile]

3. It can be very local and even down to an individual

I think we are already in a recession nationally, although some areas are doing better - or worse. The actual indicators often lag because of the data collection and analysis but the gas price effect is going to show up very soon.
Individually, I am in a depression. This is all overwhelmingly sad and frustrating.

[Dave Id]

4. Even if it may technically 'only' a recession

housing, utilities, food, gasoline, and the general cost of living is pretty depressing.

[edhopper]

5. We still have economic growth

So technically we are not. But job numbers are awful and inflation is hurting every one.
Also the current government numbers can't be trusted.

[3_Limes]

6. An oldie (from the '70s. Or maybe earlier.)

A recession is when your neighbor is out of work. A depression is when you're out of work.


And - by definition, a recession is 6 consecutive months of decline in national economic output. So we're not there yet. At least technically.

[Volaris]

10. I think if the AI bubble pops, and the bottom drops out of the market, it'll all hit at once.

That bubble is the plug in the dam, its the ONLY thing holding back the flood right now.
IF AI companies can't get the high-end chips they need cause you need stuff from the gulf to do that, that pop is ALREADY baked-in, it's just a question of who's gonna pull their capital out first and trigger a panic.

It's a game of nerves now, and I think increasingly the market isn't trusting trump to find a long-term solution.

I'm neither an investor OR an economist, that's just my 2 cents.

[Dave says]

12. If I understand the "6 months" remark...

Then we don’t have to see negative GDP, just slowing growth for 6 consecutive months? Say, gdp at 3% at start. Then 2.9% next month, 2.4% the following month, and so on?

[questionseverything]

15. A two month decline in GDP is technically a recession

[Johonny]

7. K shaped economy

Much of America has entered stagflation. Low job growth, higher inflation.

The top of the economy is not feeling it at all, though.

There's a solid chance of a recession come 3rd and 4th quarter. The longer the Iran war, the greater the chances. Inflation seems impossible to avoid.

[Sympthsical]

14. This

We're experiencing two different economies right now. The lower leg is having no fun at all while the upper leg is looking around going, "Why, did something happen?"

Although gas prices are an incredibly hard indicator to ignore. Even if you're personally doing fine, seeing $6-7 a gallon is a daily reminder that shit ain't goin so great.

[Redleg]

8. I call it a "deep funk"

But that is about my own emotional state. As for the economy, I don't think we are in recession territory yet because there is still some economic growth. The indicators don't look great though with slowly employment, rising prices, supply shocks, etc.

[MichMan]

9. No

[A HERETIC I AM]

11. The two situations have been decribed thus:

A recession is when an economy has been bought to its knees.

A depression is when an economy is flat on its back and can't get up.

Neither of those are happening right now.

[Wednesdays]

13. I don't think we're in a recession yet

... Key word: "YET."

But with gas prices as high as they are, the question is not "if" but "when.". And how bad.

I'm looking at the unemployment rates to start climbing around January to April next year, 2027. And it's going to be bad. How bad, depends on how long the fuel prices stay high.

[ProfessorGAC]

16. Neither

And, we are miles from a depression.
Traditionally, a Depression is a recession at least 10 months long with GDP contraction of over 10% & unemployment approaching 20%.
There are other metrics used, for instance, 1% increase in UE every month for 10 or 12 months (meaning it never hits 20%), or hyperinflation, which we don't have today (or even close).
It's bad right now, but not technically we haven't hit the markers for full recession and certainly not depression.

[GenThePerservering]

17. People I know burbling with joy about their 401Ks

don't seem to be looking beyond their own naval gazing. We're in an unstable situation.