Dating 30 years ago
The trough dates for these indicators are: Macroeconomic Advisers' monthly GDP (June) The Stock-Watson index of monthly GDP (June) Their index of monthly GDI (July) An average of their two indexes of monthly GDP and GDI (June) Real manufacturing and trade sales (June) Index of Industrial Production (June) Real personal income less transfers (October) Aggregate hours of work in the total economy (October) Payroll survey employment (December) Household survey employment (December) The committee concluded that the choice of June 2009 as the trough month for economic activity was consistent with the later trough months in the labor-market indicators–aggregate hours and employment–for two reasons.
At its meeting, the committee determined that a trough in business activity occurred in the U. The recession lasted 18 months, which makes it the longest of any recession since World War II.Rather, the committee determined only that the recession ended and a recovery began in that month.A recession is a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.It places particular emphasis on measures that refer to the total economy rather than to particular sectors.These include a measure of monthly GDP that has been developed by the private forecasting firm Macroeconomic Advisers, measures of monthly GDP and GDI that have been developed by two members of the committee in independent research (James Stock and Mark Watson, (available here), real personal income excluding transfers, the payroll and household measures of total employment, and aggregate hours of work in the total economy.The committee concluded that strong growth in both real GDP and real GDI in the fourth quarter of 2009 ruled out the possibility that the trough occurred later than the third quarter.
The committee designated June as the month of the trough based on several monthly indicators.
Identifying the date of the trough involved weighing the behavior of various indicators of economic activity.
The estimates of real GDP and GDI issued by the Bureau of Economic Analysis of the U. Department of Commerce are only available quarterly.
There were two reasons for selecting the earlier date.
The first was described above -- the fact that quarterly real GDP and GDI rose strongly in the fourth quarter.
Real GDP reached its low point in the second quarter of 2009, while the value of real GDI was essentially identical in the second and third quarters of 2009.