This will be a consumer story, not a business story.

The thing about NBER is that, like it or not, they’re the arbiters of recession dating. You can say what you want about them, that they’re partisan hacks or whatever, but that doesn’t change the fact that they’re the refs. This is clearly going to lead to a call of “hackery” when they declare a 2008 recession, but I guess we’ll cross that bridge when we come to it. And you can cite however many definitions of “recession” as you’d like, the only one that truly matters is theirs.

On the Bush/Iraq/WMD thing, I’ll give you an “A” for effort in trying to bait me into an argument on that. I’ve got my opinions on that, too, as you might well imagine, but I’m going to keep them to myself. Suffice to say that mine differ slightly from yours. Or shall we just say that I’m not the least bit surprised by any of what Scott McClellan’s now saying, only that he’s saying it at all. But feel free to tell me how he was just a “lowly” press secretary if you’d like.

Sort of like your version of “Bush lied.”

The worst you can say is that Bush had the basic facts wrong because he was misled by CIA or whoever (although I think the history will show that he was speaking the truth, because there were plenty of WMDs found, and those that weren’t most likely went to Syria.).

You’re in the same unfortunate position, having been misled by alleged experts at NBER. You’re not “lying,” you just have your basic facts wrong because you’ve been misled.

Therefore, no apology is in order, but you’re free to leave if you’re so offended.

Now, you said I had “basic facts wrong” regarding ISM in late 1973 and/or the date the NBER declared the recession. I did not, as I clearly demonstrated. That you’re bringing in a whole host of irrelevancies is of no consequence to that part of the discussion. ISM was what it was, and the NBER said what it said. You are obviously free to disagree, but you are not free to claim I had “the basic facts wrong” when I clearly did not. Whether or not NBER blew the call is another discussion entirely that has zero to do with the data I presented. Frankly, an apology is in order, but I won’t hold my breath.

Among the reasons I downplay the ISM is that this is — and will be for a while — a consumer led downturn, with Americans facing numerous very strong headwinds: A slack labor market, meager (if any) wage growth, spiking food and energy costs, record-tight credit conditions, just to name a few. Like businesses did in the aftermath of the tech bubble, consumers are going to have to mend their balance sheets. Given we’re collectively 70% of GDP, that is going to problematic for a while.

The recession didn’t start until 3Q74. Growth negative, ISM contracting, unemployment at or above 5.5%, almost no seasonally adjusted jobs added from July-Oct, followed by -970,000 seasonally adjusted jobs lost in November and December. Once it started, it was pretty rough. But it didn’t start until 3Q74. Sorry.

I’m not giving up on the two consecutive quarters of negative growth definition until NBER shows me that they own the dictionary. Which they don’t. That’s right, they don’t.

Indeed, according to Wall Street Words, “The National Bureau of Economic Research formally defines a recession as three consecutive quarters of falling real gross domestic product.” Okay, I’ll concede to NBER. It’s really three quarters. Come back at the end of the year.

And if NBER tries to push a “recession” on us if it ends up that there NEVER was a negative quarter of growth, esp never one below 0.5%, they’re out of their minds.

The personals are a tough call, because I don’t know if that includes withholdings or not. It could be that unincorporated or Sub-S types are paying in more because they had a good 2007 and/or think 2008 is going to be about as good.

1973-09-01 63.5
1973-10-01 66.2
1973-11-01 68.1
1973-12-01 63.6

Let’s see…printed in the 60s in the fall of 1973. Check. One print close to 70, at 68.1. Check. NBER declares recession started November 1973. Check. Yeah, I really screwed up on that set of facts. And when — if ever — are you going to give up on that “consecutive quarters of negative growth” canard???

The BEA data show that there weren’t two consecutive quarters of negative growth until Q3 and Q4 of 1974.

NBER “says” that the recession started in Nov. 1973, but growth during Q473, Q174, and Q274 was an annualized compounded 1.6% (+3.9, -3.4%, +1.2%). It’s bat-bleep crazy to call those three quarters a period of recession.

When the REAL recession started, in 3Q74, ISM manufacturing dropped below 50 for the first time in Sept. and got as low as 30.7 in Jan. 1975. It got back above 50 in Aug. 1975.

The mid-1970s recession wasn’t as rough as the ones of the early 1980s if you include what NBER includes, but it was right in there if you don’t:
– 2Q80 – minus 7.8%, 3Q80 – minus 0.7%, annualized -4.2% for two quarters
– 2Q81 through 3Q82 – annualized about minus 1.5% for six quarters
– 4Q73 through 1Q75 – annualized about minus 1.4% for six quarters
– 3Q74 through 1Q75 – annualized about minus 3.4% for three quarters

Manufacturing types and others have 2-1/2 to 3-1/2 decades of improved feedback mechanisms, making more recent experience with the predictive value of the ISM data much more relevant. In the 1970s, they were caught “sleeping” and thought that things weren’t going to get as rough as they did.

Having to reach back 35 years to try to sew significant doubt is a sign of desperation.

Though I don’t think what you linked to necessarily reflects current probabilities — more like future (12 months).

HERE