In following up from my preceding post “Bernanke at Brookings,” I’ve noticed that my reaction to his news about the technical end of the recession mirrors lots of other reactions. I saw a great political cartoon on the editorial page in my morning paper today that showed somebody holding an umemployment sign responding to the remark by Bernanke that the “recession is likely over” by saying “No, it’s not!”
I have to agree that while technical measure may be important to economists, and that while leading indicators may signal the end of a recession, it’s only when trailing indicators — most notably, employment and consumer confidence — participate in an upswing that the “person on the street” starts to put some credibility into claims that the situation is improving.
My understanding is that we have anywhere from six to twelve months still ahead where other signs of improvement will begin to appear here and there, leading ultimately to a general sense of better times and conditions. But until the IT employment situation turns around and actual job growth begins to show itself, I don’t think most people (including myself) will be feeling too sanguine about the state of the economy and the technical status of the recession or any subsequent (technical) expansion.