She’s feeling economically depressed
Question: What’s the real difference between a recession and a depression? I’ve lived through the depression and current economic conditions seem ominous to me.
Answer: An article in the January 23, 2008 issue of the Herald-Leader defined recession this way: The National Bureau of Economic Research defines a recession. The bureau defines a recession as “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP (gross domestic product), real income, employment, industrial production, and wholesale-retail sales.”
Web site of National Bureau of Economic Research to find more about recessions:
I talked to Ken Troske, professor of economics and director of the University of Kentucky’s Center for Business and Economic Research. He says there has only been one depression in the 20th century and that was the Great Depression that started with the stock market crash of 1929. He also says there is no formal definition for a depression but some events that might trigger discussion of a depression would be unemployment of 25% or greater, output (GDP) falling by 5% or more, and falling prices. Troske says that with today’s average unemployment hovering around 5%, we are nowhere near the unemployment numbers of the Great Depression. In 1933, for example, unemployment reached 25%, decreased for a period and then jumped back up to 20% in 1937.
Linda Niemi
Filed under: Uncategorized
My mother was a public school librarian. I earned a bachelor’s degree in music and a master’s degree in library and information science from the University of Kentucky. The Herald-Leader hired me as a news assistant 25 years ago; soon after, I moved to the news research department, where I’ve been ever since. We used to clip newspapers. Now, almost all of our research is online. We've come a long way.
A recession is usually describe as when your neighbor loses his job and a depression when you lose your job!