Has the 2nd Great Depression begun?

[KillCapitalism]

http://news.yahoo.com/s/ap/20080606/ap_on_bi_go_ec_fi/economy

http://news.yahoo.com/s/ap/20080606/ap_on_bi_ge/oil_prices

These would seem to indicate that it possibly has. What is your opinion?

[napi21]

1. I guess a "depression" is akin to a bad economy. If your neighbor

gets laid off, it's sad. If YOU get laid off it's a bad economy.

[ColbertWatcher]

2. What is it called when...

...all the homes in the neighborhood are empty because the banks foreclosed on everybody?

[Warpy]

3. Not quite

A depression is when people have so much tied up in servicing their debt, they stop all consumer spending just to stay afloat. That's about where too many families are now, paying monthly service to mortgage, student loan, credit card, car payment, and other debt. Add to that the skyrocketing prices for necessities like food and fuel and you begin to get just how grim the picture is for most families.

You can see what's happening in any mall: chain stores are starting to go under; toy stores like Sharper Image and Comp USA are already gone, many of the other working class luxury stores are in serious trouble. Soon, even the stores selling basic consumer goods like clothing will be in trouble as people discover basic mending skills to help squeeze a few more wearable months out of even Wal Mart trash.

A recession means a lot of people are out of work and hurting and everybody else is nervous about their own situation. A depression is the slow collapse of the consumer market, two thirds of this economy. We are just now starting to see that collapse happen.

[Wizard777]

4. Bush has called Rush trying to get 10 billion Paxils for the economy.

I guess he figured Rush would have that much just laying around.

[InkAddict]

6. He should have just raided (as in Executive Order) Laura's Xanax supplier n/t

[jakem]

5. im not feeling the "great" part...

but the depression is here!

[Tippy]

8. me 2

[originalpckelly]

7. I think we're going to have to go above 5.5% unemployment...

to consider it a great depression.

Oil is pretty awful, but great depression? Not yet.

[KillCapitalism]

10. Come now...

do you REALLY believe unemployment is 5.5%?

[Xenotime]

9. Yes. Stocks are down and unemployment is up. What else to you call it?

[ProfessorGAC]

11. Not Even Close

Neither of your cites are convincing. The statistical evidence doesn't remotely reflect depressionary economics. Highly recessionary, perhaps even regressionary. Not a depression. Employment is far too high. Profitability of recession resistant companies is still solid. Consumption is FAR, FAR, FAR too high, and banks aren't taking losses of liquidity just by normal operations. (The banks in trouble got themselves into that mess.)

Both articles are extreme hyperbole and bear little resemblance to valid econometric study.
The Professor

[LanternWaste]

12. isn't there a precise economic definition as to what constitutes a depression?

As a matter of fact (and I'm trying to recall my Macro and Micro Eco courses from college), isn't there a precise economic definition as to what constitutes a depression?

If I recall correctly, particular points on economic "graphs" have to be met in addition to falling wages, increasing prices, GDP and GNP moves, employment, etc.