Tuesday, December 2, 2008

The Longest Recession Since .

The Longest Recession Since …

By now, everyone has heard that the current financial crisis is the worst since the Great Depression. Is this also going to turn out to be the longest recession since the Depression?

The National Bureau of Economic Research — the widely acknowledged arbiter of recessions — announced today that a recession began in December 2007. That means the downturn is now a year old, and no one thinks it’s on the verge of ending.

Here are the longest recessions of the last century:

1929-33: 43 months
1910-12: 24 months
1913-14: 23 months
1920-21: 18 months
1973-75: 16 months
1980-81: 16 months

Economists have been forecasting that the current recession will likely end sometime in the spring (which is, presumably, when some of the new stimulus money will start to be spent). If they’re right, this recession will be roughly as long as the 1973-75 recession and the 1980-81 recession, both of which were 16 months. To find a longer one than that, you have to go back to the Depression.

Remember, too, that forecasters have been far too optimistic over the past year. At some point, that will change. But for now, the best bet seems to be that this recession will last for more than 16 months.

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