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Is this recession simply running out of steam?

March 18, 2013

By Steve Boggs, publisher. sboggs@bentoncourier.com

There are signs of life in our economy, without a doubt. Unemployment is down, the stock market is riding an all-time high win streak, and the housing market is showing signs of sustained life. We’re in an energy boom, and every day we hear stories of a few manufacturing jobs returning to the U.S. It is an uptick, to be sure.
View these latest economic trends with the skepticism they deserve, but don’t completely rule out the possibility that our economy could be on the mend for real. The government, the source of most economic tracking data, told us this recession officially ended at the beginning of 2010. Most of us know better.
When the economy collapsed in 2008, it caught most of us by surprise. It shouldn’t have, but it did. It had never occurred to us that our homes could lose 30 percent of their value in just over a year’s time, or that unemployment could almost double in less than two years. When the Wall Street banks began tumbling, there was real fear that we could be headed into a second Great Depression. The so-called housing bubble popped, and the sound was so loud that it sent our country into a deep recession – one we remain in to this day.
The kids who start preschool this fall have never lived in a healthy economy. Those who graduated from high school in 2008 began earning college degrees last year. They spent much of this recession incubated from the job market, and now that they’re trying to find work, the recession is brand new to them.
The economic downturn that began in 2007 and accelerated in 2008 is lingering like a nasty cold. We’ve stayed in bed and drank plenty of liquids for five years, but we still feel like crud. Our country, and most of the world, has been stuck in a malaise for half a decade.
But the wheels are starting to turn again. Maybe this time it truly is for real. For unexplainable reasons, it sure seems that way. There are some who predicted way back in 2008 that this cycle would last five years. They said it would take that long to balance supply to demand in the housing market, and for working Americans to de-leverage (read: pay off debt) to the point they could start spending again.
We’ve been told the recession officially ended three years ago. Along the way we’ve seen tepid job growth, but growth nonetheless, and some growth in consumer spending. Those were positive economic indicators most of us completely ignored because of the politics involved.
This time it seems different. Maybe it’s just time. Maybe this cold, err, recession, has simply run its course. Could it be that simple? After five years of political warfare through two elections, trillions in stimulus spending and bailouts for everyone from General Motors to AIG, perhaps this economic downturn is running out of reasons to exist.
Can a recession just run out of steam?
That’s an oversimplification, to be sure. Yet the intangible signs – however insignificant – are all pointing in the right direction.
Recovery appears to be happening, if for no other reason than it’s just time.

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