Last month, I posted the NY Fed’s “Chance of Recession” spread. It’s a fun little chart that shows the chance that our economy will be in recession in the next 12 months. It’s SUPER fun now because the value is about as low as it’s ever been; 00.041%.
TJIC called shenanigans:
So you think that the chance of a recession is 200:1 against?
Tell you what, I’ll offer you great odds – 100:1 (that’s twice what the data suggests).
If anything has changed in the last month it’s the fact that the chance of recession reduced by 20%. We went from the ridiculously low chance of .055% all the way down to .041%. The only times in the last 50 years it has been this low was in 1983 for 2 consecutive months; August and September.
As for the “current” recession, NBER takes an exceptionally long time to officially declare the end, up to 24 months. As I have been on the record as saying, I think the recession ended late May 2009; NBER won’t score it until January 2011, longer if I am wrong.