Daddy, what’s a recession?

“A recession is when you lose your job.

A depression is when I lose mine.”

Sidney Harris

Today will doubtlessly be a lesson in dismal economics, to wit, what is a recession? I believe the proper definition is two consecutive quarters of decline in the gross domestic product — or GDP — which sometimes means the recession is underway because reporting on things like the GDP tend to lag a while and are not calculated in real time. For the public, it’s a perception of the stock market. A few shrill headlines, the plunging line on the chart, the addition of the word “Black” to whatever day of the week it happens to be, and self-fulfilling chaos ensues. I’m not saying ignore the headlines, just pointing out that most of the people who write them have no idea what they are talking about.