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The Equivocal Economy

Adolescents often rely on “yeah-but” equivocations to explain the complexities of reality. (For example: “Yeah-but I wouldn’t have beenlate if I wasn’t stopped for speeding.”)

In light of the erratic behavior of theeconomy since the end of the “Great Recession” we should name the reboundthe “Yeah-But Recovery” (“YBR”) as in:“Yeah-but it’s not as bad as it was,” and“Yeah-but it’s not as good as it should be.”Federal Reserve Chair Ben Bernankebest summarized the implications ofthe YBR when he testified that “theeconomic outlook remains unusuallyuncertain.”  

This has been a YBR from the start. Its beginning wasn’t announced until15 months after the event by the National Bureau of Economic Research(“NBER”), in what was tantamount to ayeah-but release (cf., http://www.nber.org/cycles/sept2010.html).In making its determinations, the NBERexamines a range of “measures thatrefer to the total economy,” includingGross Domestic Product (“GDP”), data onincomes and wholesale/retail sales, andindicators of output. Its determinationsare not based on a “fixed formula;” butare, instead, an informed judgment ofwhen the shift from contraction to...

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