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The recession is over: time to move on

The National Bureau of Economic Research announced today that the recession officially ended in June 2009. Starting in December 2007, the 18-month period was the longest recession since the Second World War.

No big deal? Well, first of all, as Barry Ritholtz points out, the news from the NBER (with its accompanying evidence) puts paid to those who have proclaimed that the US economy remains stuck in recession. Furthermore, there are those who have said “so what” about the end to the recession, given that unemployment remains stubbornly high. But, in this regard, it is clear that historically job growth follows output growth, but usually lags. The growth since June 2009 is likely to be creating pressures for greater employment growth.

It’s almost a certainty that the conventional wisdom among economic commentators is behind the curve: they are still celebrating an upturn when there are signs of a downturn emerging, and are bemoaning a recession when indicators point to a recovery. So is everything hunky-dory today? Not at all. In fact, it is the lack of robustness in the recovery period that highlights that all is not well. And a “double dip” is hardly out of the question. But, as Obama is fond of saying, make no mistake: a recovery has been happening. The question turns to its strength, not its existence.

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