Are we in a recession or are we going towards one?

Why does it matter? With inflation being allowed to continue, the impact is the same either way. Here is the May CPI and Motley’s Fool’s two cent’s worth on it:

“The evidence is everywhere, even in the “core” CPI, which pretends that food and energy prices don’t matter. Yet those of us who do eat shelled out 5% more in May than we did last year. Get a load of what inflation has done to the following staples:

Goods May 2007 May 2008 Increase

Diesel Fuel $2.91 $4.45 53%

White Flour $0.35 $0.53 52%

Rice $0.54 $0.70 29%

Eggs (dozen) $1.50 $1.93 28%

Gasoline $3.13 $3.76 20%

Gas 100 thrms $128.87 $150.49 17%

Milk $3.26 $3.76 15%

Bread $1.19 $1.37 15%

Source: US Bureau of Labor Statistics. Liquids by the gallon, other commodities per lb.”

What is the answer to reverse the Recession?

Most economist doesn’t like throwing that word around too much, but it’s true, it’s happening.

I don’t think we are in one. Prices are going crazy while wages remain stagnant but I don’t think that we are technically in a recession right now. Usually the recession is over before we actually have the data to say that we were actually in one.

I am wondering if this may be the start of something worse than a recession? The rising cost of gasoline is pushing up the cost of everything else. Meanwhile peoples salaries are not increasing. I know of a few people who work for companies who didn’t get pay raises this year because business was down and costs are increasing. At one of my friends companies the empolyees voted not to take a pay raise inorder that no one would get layed off. Scary times !!!

I agree with Jeff Madrick that the policies of neither political party are the answer. We have been applying bandaids for too long. It hid the sore, but meanwhile, it was still festering underneath. His recipe is: “What America needs is a set of policies that will make it a high-wage nation again, no longer dependent on ever increasing consumer debt and work hours to make ends meet. It must once again invest adequately in the public goods and services required to compete in the new century, including early education, transportation infrastructure, energy conservation and healthcare reform.”

@Marina, $3.76 for gas? Your getting off lucky. I spent $4.20 a gallon for regular unleaded this morning.

@Stocky That was May. I am in Orlando, though, and it is still only about $3.89 at the cheapest places. When I was in Seattle, it was about $4.53 for regular!

http://creditmeltdown.blogspot.com

…YES WE ARE IN A RECESSION! HAVE BEEN SINCE 2006

We are in an economic slump, if not a recession. I’m wary of the word, as it has the tendency to be over-politicized and over-utilized to further one’s personal views.
Jump on the Bureau of labor and Statistics page and run some of the calculators.