The P.A.

A weekly address from Patrick Adams,
President of St. Louis Community Credit Union

Recession Isn’t Over ‘Til It’s Over

On September 21st, 2009, posted in: Uncategorized by

Federal Reserve Chairman Ben Bernanke recently announced that the recession is over.  Really?  I’ll bet you that Mr. Bernanke’s valiant pronouncement caught you much like it caught me – frozen in my tracks.  My thought was “Did I hear that right?”  Sort of like if you turned on the radio and heard that Cardinals’ General Manager John Mozeliak had traded Albert Pujols.  The news would put you in shock, followed by a guttural, inaudible sort of “huh?”  Yeah, that’s what would happen, then a knee-jerk reaction that would be both extremely audible and bring into question a person’s sanity. It would sound like this: “What’s he thinking?”

I’m sure Mr. Bernanke got his information from an endless database showing that some key indicators had moved far enough above zero that he felt comfortable in making such a statement.  Believe me, it’s a complicated, convoluted and cock-eyed world of numbers that Mr. Bernanke and his band of merry men pour through to gain their perspective.  I might suggest that somewhere in their analysis of the economy they get outside of the books and the beltway.  In other words, “the recession is over” may be a hard sell on the streets of small town America.  I’m just guessing that he hasn’t convinced many people.

To Mr. Bernanke’s credit, he did qualify his statement to say that we were a long way from recovery.  With the qualifier attached, Mr. Bernanke’s initial position seems a little watered down.  Thus, it begs the question: which “R” word should we really give our attention to: recession or recovery?  Since the recession is presumably over and represents the past, recovery should be the focus of discussion.   Okay, when’s the recovery?

Job creation is key to a recovery.  Folks need jobs.  With jobs, consumers will spend more money – that will, in turn, create more jobs.  Keep spending money and we’ll sustain job growth, which will further insure recovery.  If we start spending on our own and do it without the façade of government-induced stimulus, Mr. Bernanke will jump to the podium, and grab the microphone and the attention of an entire country when he announces that the recovery is in full swing.  That’s what we really want to hear.

The fact that the recession is over really means nothing to the folks on Main Street USA. Without the creation of some good jobs for those who are unemployed, we’re saying “no way” on the whole “recession is over” gig.  It means nothing until the part-timers get their hours back.  It means nothing until employers quit furloughing full-timers.  Jobs need to be prevalent.  That’s what we want.  Thanks, Mr. Bernanke, for leading us away from the recession.  Now if you help lead us into a full-fledged recovery, you’ll have our undivided attention.

As a sidebar, Mr. Bernanke should take note that President Bush announced “Mission Accomplished” within a very short window of time after the war in Iraq had begun.  While he may have been misunderstood, his intimation was that the war had ended.  That was 6 1/2 years ago.  I guess the lesson to be learned is that timing is everything…or as Yogi Berra would say: “It’s not over ‘til it’s over.”

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