Great Recession over? U.S. passed employment peak, but…
Jun 26th, 2014
Great Recession over? U.S. passed employment peak
A couple weeks ago, reportedly, the US returned to a level of employment comparable to the pre-2008 level.
We see the US and other countries (including Greece) slowly emerging from the crisis, in some cases employment getting back to reasonable pre-recession percentages, but many doubts linger. In the same days we also read that “Americans think economy won’t recover until 2017” and we have read many papers on the income speciation.
A little reminder
Back in November 2008 we published a predictive paper followed by timely updates in:
Stages of “damage”, or consequences of the recession were described.
What does that mean?
Well, we predicted in November 2008 that there were 90% chances the recession would last up to 2014 and 10% chances the crisis would last more than 6 years, i.e. past 2014. We were focusing our consequences analysis on societal values, having recognized that the “societal” reality and the “financial” one were on the brink of severe divergence.
When in the last six years we went back to the original forecast we left it unchanged, as it seemed that events such as Occupy Wall Street, the Greek Riots, generalized problems in other G20 countries were only corroborating the duration and depth of the original forecasted recession.
Now, as we are almost at the 6th anniversary (in November) of our forecast, we see the US and other countries (including Greece) displaying favorable indicators, slowly emerging from the crisis, employment getting back to reasonable pre-recession percentages, but globally, for G20, the crisis is not over.
Ladies and Gentlemen, we are now boldly entering in the long tail, that last 10% in the duration distribution.
Public perception is still negative and many people, including in the USA, think now full recovery “of the economy” will take another 3 years.
From a technical standpoint, we would call 2008-2014 a “completed crisis cycle” with a deep excursion into crisis territory and a return to “normal”, qualified by a number of key indicators, but certainly not to “the old normal” in term of the overall well being.
If there is a new recession “tomorrow”, from a technical point of view, it could be considered as a new event.
When the next wave hits, however, please just do not call it a Black Swan, because it isn’t!
Tagged with: black swan, Great Recession, societal values
Category: Consequences, Crisis management, Probabilities, Risk analysis