Here's a brief, late Friday post to follow up on the jobs number. If you look at recoveries from past recessions in the United States, what you usually see is a fall in the year-over-year unemployment rate as the economy gathers steam. And this fall gathers steam as the recovery picks up its pace. Clearly, this should make intuitive sense because a recession is a first derivative event; recessions measure the change in employment, income, output, retail sales and GDP not the absolute level.
So to anticipate a change in economic direction or in the pace of economic slowing/acceleration what one has to be looking for in the numbers is a change in the change in the level of those sub-components that point to recession or recovery. For example, when you look at the unemployment rate, what yo...
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Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He has also been a regular economic and financial commentator in print and on television for the past decade. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.