The Economic 'Recovery' In Historical Context

Tyler Durden's picture

How does the current 'recovery', which according to the NBER officially began in June 2009, compare to those of the past? The Council on Foreign Relations updates its recovery chartbook and succinctly notes that "the current recovery remains an outlier among post-war recoveries along several dimensions." Consumers remain reluctant to take on new debt and the stock of debt is lower than it was when the recovery officially began. The global economic slowdown is beginning to manifest itself in world trade. After staging the strongest recovery of the post–World War II era, growth in world trade has begun to decelerate.


Real GDP

  • Real GDP is growing, but less rapidly than in any other postwar recovery.
  • Thirty-six months after the start of the economic recovery, GDP is only 6.7 percent higher than it was when the recovery officially began.
  • As of the second quarter of this year, real GDP is 1.7 percent above its pre-crisis peak, having first surpassed this peak in the fourth quarter of 2011.


Nominal Housing Prices

  • Although housing starts have recently recovered, nominal home prices have yet to follow.
  • Soft home prices have been central to the weakness of the recovery. Prices have continued to fall even after the recession officially ended.
  • The continued weakness of nominal home prices is a postwar anomaly.


Household Deleveraging

  • In every previous postwar recovery, the stock of household debt has risen as the recovery has begun.
  • In the current recovery, the collapse in home prices has severely damaged household balance sheets. As a result, consumers have avoided taking on new debt.
  • The result is weak consumer demand and a slow recovery.


Nonfarm Payrolls

  • The relative weakness of this recovery is obvious in the labor market.
  • Job losses continued throughout the first eight months of the recovery.
  • Payrolls have increased for the past twenty-two consecutive months, but there are still five million fewer Americans on nonfarm payrolls than there were at the start of 2008.


Industrial Production

  • Because of the depth of the recent recession, one might expect stronger-than-average improvement in industrial production.
  • Despite the predicted snapback, the increase in industrial production during this recovery has been fairly typical of postwar recoveries.


Industrial Capacity

  • Capacity in manufacturing, mining, and electric and gas utilities usually grows steadily from the start of a recovery; however, during the current recovery, investment was initially so slow that capacity declined.
  • Since the start of last year, this trend has reversed itself and industrial capacity has been steadily rising.


World Trade

  • The pace of growth in world trade has slowed in recent months as global economic growth has decelerated.
  • World trade volume initially recovered more quickly than in any other post–World War II recovery; however, this reflected the depth of the fall during the recession.


Federal Deficit

  • The federal deficit was much larger at the start of this recovery than it was in any other postwar recovery.
  • Although the deficit as a percent of GDP has shrunk slightly, its level creates significant challenges for policymakers and the economy.

Source: Council of Foreign Relations

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user2011's picture

U mean the use of "seasonal adjustments" in historical context, right ?

vast-dom's picture

let's have the QE adjusted GDP chart please. 

Temporis's picture

After reading todays little article about...

National Weather Service Follows DHS In Huge Ammo Purchase (August 14th 2012)

Is all hell about to break lose in the United States soon?


Fully Armed U.S. Troops Patrol Minnesota Neighborhood (May 1st, 2012)

US Army Now Training On North St. Louis Streets (June 26th, 2012)

It's not just Homeland Security: US Army orders riot gear too. (July 30th, 2012)

Homeland Security To Purchase ANOTHER 750 MILLION Rounds Of Ammo … In Preparation For All-Out Civil War (August 13th, 2012)

Patriot Eke's picture

NOAA Weather Alerts are about to become much more personal.

ndotken's picture

The end game is already in progress ... if you haven't begun preparations ... then you're behind the curve

ejmoosa's picture

What's the return on investment when a .27 cent bullet removes a potential $200,000 liability for future retirement and medical benefits?

And they said this administration would not be able to balance the budget.


Just wait.


VulpisVulpis's picture

'Since the end of the recession'


Who still thinks this is a recession?

poor fella's picture

In the same vain, Romney said that in eight years America could be energy independent!

I'm thinking, either he's an accomplished  petroleum engineer and knows where to drill for abiotic oil - or realizes we'll all be riding bikes and horses.

Even lies are taking an exponential growth trajectory.

tocointhephrase's picture

You no it would be a shocker!

duo's picture

how about a chart using pre-1992 inflation calculations?  It would show the economy 30% smaller than 2007.

If BS statistics can't make the charts look good, something is wrong.

Flakmeister's picture

You cannot have a recovery if you cannot have cheap oil....

The game is over, no matter who is in the Oval office...

Dr. Engali's picture

You can't have a recovery without cheap oil combined with  excessive debt .

CrashisOptimistic's picture

And that, Flakdood, is that.

Look up yesterday's Bloomberg article on Brazil's oil output smash.  A complete destruction of IEA's outyear numbers.  Wait here it is:


Drumbeat was all over that like white on rice.  It's the second indicator that the delusion is failing.  The first was Brent spreads.

Flakmeister's picture

Yep... saw it as well...

Remind me, has Brazil become a net Exporter yet with all that oil???

Umm... didcha notice that  oil has been in a strong uptrend since the Iranian sanctions kicked in? I guess there was not much of a glut to cover the Iranian exports.....

CrashisOptimistic's picture

Did notice all of that, mostly in Brent and the other blends.  WTI is subsidized lower by campaign funding.  That's about optics and only optics since the refineries pay Brent prices.

Mostly I am focused on the details of the article.  They are at just under  2 mbpd (recent months) and their plan is to hold that level for 2 years, out to to 2015.

This gives them a lousy 5 years, FIVE YEARS, to go to 5.7-mbpd-by-2020 on their projections, and IEA's outyear projections says 6+ by 2020.

Where the HELL does IEA think they are going to get that if they aren't even 2 mbpd in 2015?  The world is depending on that extra 3.5 million and it's not going to be there.

The answer is not complex.  The consumption level won't consume it.  When it doesn't and GDP declines and people die, some reporter somewhere will celebrate lower consumption and how oil reserves can stretch that much further.   They just can't wrap their minds around the reality that consumption drops if you don't have supply.

Patriot Eke's picture

Where's the chart for the debt?

vertexa's picture

BANK OF AMERICA: Things Are Going To Collapse Again In Europe

Terminus C's picture

The Europeans must have come up with an actual, viable solution to solve their plethora of issues if BoA is crying collapse.

SheepDog-One's picture

Some people just see red squiggly lines, I see all the more room for more HOPE! :D

Patriot Eke's picture

The entire world is going to be seeing a lot more red in the near future.

HurricaneSeason's picture

The war with Iran will be good for the economy, once the war with Syria is over. Like Cheney said "Deficits don't matter".

Patriot Eke's picture

Deficits don't matter, but debt does.

aint no fortunate son's picture

well, I'm just grateful that Afghanistan's over, as promised - expecting another Nobel Prize arriving at Pennsylvania Ave any day now

aint no fortunate son's picture

I'd like to see the non-farm payrolls "recovery" comps if they eliminated part-time jobs across the board

Cognitive Dissonance's picture

Get me some Viagra....stat.

vbone's picture

arent these bullish chartz brosh! lol, they charts dont matter in rigged marketz bro

divide_by_zero's picture

CFR as a source so as bullish as they can be for the Obama.

sgt_doom's picture

As the democratic wing, and the republican wing, of the bankster party have both stated:

Democracy is off the table ! ! !


warezdog's picture

Exactly what I'd expect from the CFR, are they not part of TPTB?

q99x2's picture

The fraud index is higher than any other recovery.

yogibear's picture

For Bernanke, Dudley, Yellen and Krugman just print your worries away. Get rid of the debt ceiling and double down on debt.

Let's see how fast the Kensysian fantasy land can get us to $32 trillion and still have Fitch and Moody s rate us AAA.  

In fantasy land debt doesn't matter, Bernanke can just zero out the debt by printing $32 trillion from thin air to pay it off.  

In the mean time all those Chinese that are committed to slavery to produce thing we Americans enjoy!!!

Who are the real fools??

The oil producing countries and the overseas manufacturers are the fools for giving us products and assets for worthless paper from 

thin air!


Walt D.'s picture

Recovery? Even Paul Krugman admits were in a Depression. 

sgt_doom's picture

And when even Krugman's figured it out --- it's a moot point!

earleflorida's picture

CFR and their 'Post War Recovery'?  Since when is a depression called an anomaly,...

EZYJET PILOT's picture

What recovery! Constant QE, TARP, LTRO, Twist, is now defined as a recovery! So much of a recovery that without the constant promise of fresh printing the whole charade falls apart. What if Bertwanke came out tomorrow and said enough of this QE nonsense, let's leave it to the free market to fashion itself an organic recovery and let the dice fall where they may, well we already know the results of that don't we..

EZYJET PILOT's picture

Serioulsy why are we commenting on this like it's a sane world, I can't believe this is reality sometimes. God, can you please wake me up now, I've had an absolute gutful of this incessant putrid shite!

Northeaster's picture

In the case of Post-WW II, we did in fact obliterate our global competition, literally.

LongSoupLine's picture

since the red line is still on the chart, this is bullish right?

orangegeek's picture

From 2007 to 2009 was the first leg down, much like 1929. 


From 2012 to 2016 will be the next leg down, much like 1932 (which no one talks about).


The recovery will take a very long time.  There is a lot of denial out there.



the 300000000th percent's picture

Isnt it just all pretty much inflation????

sgt_doom's picture

The Council on Foreign Relations updates its recovery chartbook and succinctly notes that "the current recovery remains an outlier among post-war recoveries along several dimensions."

This is such unmitigated bullshit!  The Council on Foreign Relations???

That neocontard bunch, in thrall to the oligarchs, who once had all the documentation online for their NAFTA Superhighway --- which rightwing, faux crat, faux liberal tool, Chris Hayes, once did one of his patently phony exposes on????

Give me an effing break, stooges!

There is no economy, phonies.  It was dismantled over the past thirty years.  Period.

Just like there is no media.  Period.  NPR and FoxFiction are the same.

There's a valid reason why George Will and Cokie Roberts enjoy jobs-for-life!

There's a reason so many media stooges enjoy jobs-for-life. 

How many other American workers can say the same?  The rest of us have had our pensions and retirement benefits, and numerous savings accounts, etc., stolen by those who employ the job-for-life media whores!

Get the message, dood?

cherokeepilot's picture

Don't post often, but I think your message has been received.

NEOSERF's picture

Hmmm, looks like the kind of charts Ben dreams about before FOMC meetings...warm up the helicopters...

dexter_morgan's picture

All Paul Ryan's fault, obviously.