What data does the NBER call a recession?

First half 2022, NBER ed

The debate between the official NBER determination of the recession and the 2Qs method has been discussed endlessly. Instead of spilling more pixels on it, I’ll just point you to it Menzie Chin Chart above (hat tip Invictus)

You can see why the NBER doesn’t rely on GDP alone (the pink line); GDP was slightly negative, while manufacturing and trade sales were more negative. But then the NFP was very strong, as were industrial production, civilian employment, consumption and personal income.

It is hard to look at these 6 (or 7) data points honestly and conclude that the country’s economic activity contracted in the first half. You can track all these data points in FRED, as explained by this blog post.

This is why a $20 trillion, complex global economy with many different moving parts cannot rely on an oversimplified and stupid definition.1 — like two consecutive quarters of negative GDP.

see more:
Data and determination behind dating business cycle peaks and troughs
Fred Blog, August 29, 2022

“Recession…” of H1 2022? (Part II)
By Menzie Chinn
EconBrowser August 26, 2022

in the past:
Why Recessions Matter to Investors (July 11, 2022)

Soft Landing RIP (July 25, 2022)

The Uncertainty Monster (July 21, 2022)

Lessons from the Future (August 24, 2022)


1. Of course, some people insist on using this definition. Some gang hacks, others just don’t know. For those of us who put capital at risk making probabilistic decisions about an inherently unknown future, we want something less crude than -2Qs.

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