6 Signs the Recession is Over

  • Good times ahead?

    A recession is defined as "a period of general economic decline; typically defined as a decline in GDP for two or more consecutive quarters. A recession is typically accompanied by a drop in the stock market, an increase in unemployment, and a decline in the housing market." There are a lot of signs that our recession might already be over. Kiplinger agrees: "Is the recession over? Yes. With initial jobless insurance claims on the wane, our recovery index is flashing three green signals, indicating that the economy has touched bottom and is on its way back up. A trend toward fewer folks filing for unemployment benefits joins increased sales of existing homes and the return to more normal credit spreads as indications that the fever has broken and the patient is recuperating." Fair enough! I hope they're right. Let's take a look at some other key signs that good times might be ahead. Photo Credit: Getty Images
    Sign: Economists think it's ending
  • Sign: Economists think it's ending

    According to the Associated Press, "More than 80 percent of economists believe the recession is over and an expansion has begun, but they expect the recovery will be slow as worries over unemployment and high federal debt persist." Photo Credit: mrhayata
    Sign: GDP growth forecast
  • Sign: GDP growth forecast

    As the AP story notes, "Forecasters now expect the economy, as measured by gross domestic product, to advance at a 2.9 percent pace in the second half of the year, after falling for four straight quarters for the first time on records dating to 1947. They expect a 3 percent gain in 2010." Sounds like the scariest drops may be behind us if these forecasters are to be trusted. Photo Credit: tudor
    Sign: Housing recovery predicted
  • Sign: Housing recovery predicted

    "Forecasters expect 2010 to be the first year since 2005 that the housing sector will contribute to overall growth. Home prices are expected to rise 2 percent in 2010, but panelists do not believe that will stifle the housing recovery," the AP reported. This is especially good news for towns that have seen hardship as a result of rapid declines in real estate values, and increases in foreclosures. Higher home prices may be just the positive sign many have been looking for. Photo Credit: jdnx
    Sign: Inflation (possibly) won't be an obstacle
  • Sign: Inflation (possibly) won't be an obstacle

    Sounds like inflation may be kept under wraps -- for now. "Labor market slack, combined with weak wage growth, meant inflation would not be an obstacle to the economic recovery and the Federal Reserve would not be under pressure to raise interest rates," Reuters reported this week. Photo Credit: Erik Charlton
    Sign: Rise in freight transportation demand
  • Sign: Rise in freight transportation demand

    As The Christian Science Monitor reported, "Demand for freight transportation is rising, according to the Freight Transportation Services Index (TSI) put together by the US Department of Transportation." This is typically a promising sign because a rise in freight transportation means the economy may be kicking into higher gear. Photo Credit: Rennett Stowe
    Roadblock: Lingering unemployment
  • Roadblock: Lingering unemployment

    According to CNNMoney, unemployment is expected to go a bit higher before the end of this year. Then it will possibly edge downward, but slowly. "Unemployment, which was at a 26-year high of 9.8% in September, is forecast to hit 10% during the last three months of this year, and stay there through the first quarter of 2010. By the end of next year, it's only expected to fall back down to 9.5%," it was reported. Looks like this won't be a perfect recovery for many, but still, there may be room for optimism if the other signs are taken fully into account. Photo Credit: Giuseppe Bognanni
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