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Reply #103: There's 'Depression' as you use the term and then there is 'Depression' [View All]

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coalition_unwilling Donating Member (1000+ posts) Send PM | Profile | Ignore Sun Jun-05-11 01:20 PM
Response to Reply #57
103. There's 'Depression' as you use the term and then there is 'Depression'
as economists generally use the term. The latter is marked by a shrinkage in GDP of 10% or more or by a recession that lasts two or more years.

Ah, but there's the rub, because a 'recession' as economists use the term is defined as any two successive quarters of shrinking GDP, no matter how small each quarter's shrinkage is. So to have a recession that lasts two years? What exactly does that mean? For example, would a recession that lasted two years mean you would need to have 8 successive quarters where GDP shrank? No one can say for sure.

What one can say is that, were it not for New Deal and Great Society safety net programs like unemployment, SS, Medicare and food security, the severe economic downturn of the past two years would have become a Depression, even using the strict definition employed by economists.

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