Here’s something from my predictions for the year 2007, which I had posted on September 9th, 2006. It took the business cycle dating committee until November of 2008 to acknowledge that the recession had actually started in December 2007. So I had beaten them by about 26 months.
6. The economy will (barely) muddle through 2007, ending the year with a slightly negative or at very best, zero growth in GDP. This is based on the infectious disease outbreak predicted above being of rather minor nature. If the outbreak is major, there will strong negative GDP growth.
Verdict: This happened almost exactly as predicted, with the recession beginning in December of 2007. Note that it took the Business Cycle Dating Committee until November 28, 2008 to announce that a recession had been occurring since December 2007. Woops!
The Business Cycle Dating Committee of the National Bureau of Economic Research met by conference call on Friday, November 28. The committee maintains a chronology of the beginning and ending dates (months and quarters) of U.S. recessions. The committee determined that a peak in economic activity occurred in the U.S. economy in December 2007. The peak marks the end of the expansion that began in November 2001 and the beginning of a recession. The expansion lasted 73 months; the previous expansion of the 1990s lasted 120 months.
A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income, and other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.
Because a recession is a broad contraction of the economy, not confined to one sector, the committee emphasizes economy-wide measures of economic activity. The committee believes that domestic production and employment are the primary conceptual measures of economic activity.