He makes a good point that just because GDP begins to rise it doesn't mean that we should stop worrying, but I don't really like his definition of when we say the recession is over. He wants it to be:
"when GDP returns to (or near) its trend line"
But I think we'd be better served by waiting till the economy is growing at its regular rate (according to Posner, about 3% annualized). That is when we know that the economy is growing appropriately.
His other comments on the history of the words "depression" and "recession" are very interesting.
"when GDP returns to (or near) its trend line"
But I think we'd be better served by waiting till the economy is growing at its regular rate (according to Posner, about 3% annualized). That is when we know that the economy is growing appropriately.
His other comments on the history of the words "depression" and "recession" are very interesting.