Yes, its pretty damn depressing to me to have the increased work load from the layoff/paycuts that are going around. Salary Employee means 50-60 hrs now, not 40! Depression...maybe not yet for the country, but personally, I'm pretty damn depressed, with less time and money!@nicemarmot617:

I wonder what the old figure would calculate today. Over 12%?

Over the past 3 years I haven't been able to GET a full time job. I've applied to literally 1,000. Several interviews, most of those the organizations never hired anyone.

I've been working one or two part-time crap jobs and/or selling things on the internet for the past 3 years. Nothing with stability.

Note that I'm no longer counted as "unemployed" - I'm "discouraged!"

Barney Frank - the queen of sub-prime.

Depression- The economy has no ability to correct itself without some massive,disruptive, stimulative event that restores buying and more importantly,pricing,power. (Like when the Japanese wanted to conquer the world without even producing a snappy,well built car)

But they keep changing how the unemployment rate is calculated. Currently it's 7.2%, but if you used the methodology from the 80's you'd get a different number. If you used the methodology from the 30's the number would be more like 12%.

A Depression is a set of circumstances that do several things:
1. Depress (hence Depression as a term of description) the Gross Domestic Product
2. Depress Employment significantly - increasing unemployment by 100% in a period of a year or so.
3. Depress prices to the point of deflation.

Have we had ANY of these things? No. Unemployment is up, but only by about 40% in the last year.
GDP has not shrunk yet, on an annualized basis, but did shrink in 4th Quarter.
Prices have not deflated, but are holding steady in relative terms.

There is a final aspect of Depression that isn't well quantified, but does play a role - the lack of access to ready cash. That is, the restriction of lending and inability to gain capital.

This has clearly NOT happened, but people will argue it has because relatively speaking, it SEEMS like it has. But lending standards were so easy, and capital investment so risky, that we were living in a falsely pumped up situation. Current lending and capital investment standards are what most economic historians would call "normal". That is, what we'd see in a relatively healthy economy. The only difference is that the economy is recovering from the shock of easy money...so it's not providing the push that would be expected.

Ease up, guys...things are NOT that bad, and the economy is incredibly resilient.

The media must be VERY careful. Consumer spending an confidence are a MAJOR driver of the economy. Yes, we are in a recession and a deeper than normal one.

However for the major media outlet on TV, the web and in print to keep running "Is the end coming?" and "How bad can it get?" stories over and over and over is simply ADDING to the stress and worry people are feeling and when they happens, they FURTHER cut back on spending which can actually cause the depression/nasty long recession the press loves chatting about the possibility of. REMAIN CALM!

I haven't lost my job, nor has my husband, but his boss and two of his co-workers have been laid off in the past month. He works in IT.

The one think that seems certain to me, although certainly not to politicians, is that we can't spend and borrow our way out. Saving, frugality, "less stuff" is kind of anti-consumerist, but we are using up the earth's resources fast enough than we are already SOL for many generations, for some stuff. (Yes, oil soon, but...who would have thought you could run out of HELIUM, of all things?)

Probably a little Amish for most of us, and it's not exactly like I'm living on some commune in a Yurt, but not screwing the next generation to the wall perforce of our mega consuming "ruggled individualist" free-market mentality, may require a little rethinking of that whole "What ***I*** want is the ultimate freedom" thing.

I was laid off by my boss in November to save his job. They fired him on Wednesday. Now they want to hire me to take his place. Roundabout way of getting a promtion. As frustrating as that job was, for the last 3 months I worked there, I stopped looking at it petulantly and started just being glad I had a job with health care. If I can get a job again I'll hold it--even if it's not perfect, it's going to be bleak for at least a few years. The employment downtrend is only accelerating, as we have seen in the last few weeks of laboricide(did I coin a word?). That means that the negative effects of those recent layoffs won't really even be felt for months, which will feed more.

Hold onto your hats.

@CaptZ: If there's anyone's opinion I take VERY SERIOUSLY, its anyone associated with the auto industry.

/snark

@Hodo: This is what I worry about most- thanks for pointing it out! We have an imbalance in our workforce, too many people without information or physical labor skills, i.e. "service" workers. Also, a lot of people are realizing they could go a few years without buying non-essential goods, which is a big reverse in the amount of manufacturing need.

@varro: gluts of manufactured products (cars, especially)

I work for a supplier for GM's SUV plant. We are working overtime today (SAT),to makeup for the 421 SUV's that were not made due to the ice storms here in Texas last Wednesday. OVERTIME! Believe it or not, SUV sales are actually beating car sales. Does that show you how ignorant people are for buying gas guzzlers? Or ho smart people are because you can get a $60k vehicle for $40k?

Depression? Nope....not yet. But I do think things are going to get worse and a majority of people arent prepared. I have alrady tightened my belt. I have cut all discretionary spending by at least half if not more and stuffing the saving in the bank. Never seen my acct grow so fast....ever.

Here's the full article: [www.economist.com]

I have lost my job, my brother has lost his job, my mother has lost her job, my neighbor has lost his job and I still don't think it is a depression.

I never thought it would happen to me, but when it does you have no words for it, just a huge blank for a few minutes, then panic. It is going to be hard going back to minimum wage for a while...

We are in no way, shape, or form, in a Depression. With such boondoggles as this "Stimulus" Debt/Spend bill being shoved down our throats, we very well may get there. But we're not there yet. GDP GREW last year. The economy contracted 6.4% in 1982. Remember the Depression of 1982? No? Well then, there's your answer.

today they let go 7 people in my office....I am in a depressive state...even though it wasnt me

From Wikipedia: "A Hooverville was the popular name for a shanty town built by homeless men during the Great Depression. They were named after the President at the time, Herbert Hoover, because he allegedly let the nation slide into depression."

By this definition, Bushville would be the correct term, if we were going to use a president's name. However, if shanty towns or homeless camps start springing up around the country, I think a more appropriate name would be "Wallstreetville" or "Subprimeville" or "Greenspanville".

@Tedicles: You know, that is absolutely true though. I read somewhere a couple of weeks ago where they did an online poll and asked "If you didn't know anything about what was going on, layoffs, credit crunch etc., would you cut back on your spending?" The majority answered no. The real economic reality is by not continuing our purchases, and I don't mean the plasma TV, I mean everyday items that are being cut down on, then we really make the problem continue. I stock bread at a local grocery store as a PT job. We have seen a decrease in the amount of bread people are buying, even the stuff on sale. Bread is considered a staple, not really a "luxury". But sales are down. Not all this is my reply to Tedicles post, but I had this to say also so I included it.

There is an estimated $600 trillion worth of leveraged derivatives out there, or 12 years worth of the entire world's COMBINED gdp (put another way, that's every cent made by every worker in every country for over a decade). That does not include our federal deficit, more than doubled during Dumbya's reign, nor the estimated $55 trillion of future promises to the retiring baby boomers.

The unemployment rate at the height of the last depression was 25%. If we were to measure unemployment using the same definitions and methodologies, the unemployment rate was around 14% a couple of months ago. And if you haven't noticed, a lot more people have been laid off since then.

Ever seen a video of an avalanche? First the slightest movements on the edge, then sections start to slide, then the whole fucking mountain comes down? We're just entering the second stage.

I'm sorry, but the collapse is inevitable at this point. It can be slowed, but it has to happen. The numbers demand it.

For anyone interested in understanding the situation fully, read up on the economic policies of the last 40 years and you'll see how all the graphs point to this eventuality. (This scenario has been repeatedly predicted by economic scholars for years but no one like depressing news. And remember what Einstein said about the universe and human stupidity?)

You can only borrow for so long until money has to be repaid. Our fractional monetary policy, along with the world's largest intentional debt engine of the privately owned "federal" reserve corporation (no more "federal" than Federal Express), well, these adjustments are eventualities built into the system for a reason: consolidation of power.

The world's monetary system will have to be rebooted, and unfortunately I don't believe that will be done peacefully.

At the rate we're going, "borrowing" and printing money, it may not take too long.

Living in SE Michigan, I sometimes feel like I'm the ONLY person who hasn't lost their job!

What could make this one of *those* would be a collapse of fossil fuel supplies, for example. The two significant depressionary periods in the US have both followed major wars--the Civil War and WWI--which dwarf in impact Iraq and Afghanistan. (Not that I consider Iraq and Afghanistan insignificant, but the Civil war killed over half a million Americans.) Short of natural disaster (or unnatural equivalent), I think that we're not going to be seeing any Hoovervilles anytime soon.

But that doesn't mean we're safe from a depression, it just means that it's not going to be the same sort of thing our grandparents would have associated with that word.

So it doesn't matter if we are or aren't in a "depression". It's just a term we used to describe the massive sweeping poverty that affected the whole country in the 30s. Obviously, we aren't there yet. Lines at Costco are still long and freeways still get jammed at rush hour, so people are obviously working and have money. The day you go to the store and it's just you and the cashier and no food on the shelves, and at the gas station there's no other cars, or the station has a sign that says "OUT OF GAS UNTIL FURTHER NOTICE", or you hit the freeway and yours is the only car on the road virtually beside the occasional patrol car, THAT'S A DEPRESSION. That's what our grandparents went thru, and we aren't anywhere near that yet, thank God.

We don't have deflation or hyperinflation, but we do have rapidly increasing rates of unemployment, tight credit markets, gluts of manufactured products (cars, especially), gluts in the housing market due to foreclosures and inability to sell houses because of tight credit.

I will be convinced that we're in the Fourth Depression (after the Panic of 1837 - caused by numerous bank failures, the Long Depression of 1873-1896, and the Great Depression) if the GDP sinks on current levels for 2 or 3 more quarters or unemployment reaches 10% for at least a quarter.

Instead of working to put money back in the hands of those who earned it, we're just getting a huge spending bill that will drive up inflation and devalue the dollar.

A Depression is when we can't get back up.

It's all a matter of "how long".

We won't know if we are in a depression until it ends.

@m4ximusprim3: Have another drink - it will all be relative soon enough.

I am curious about this as well. In the 30s, 30% of Americans were on family farms. Did those farmers count, if they were seeking work off the farm? What about an 18-year-old farm son seeking work but working on the farm in the meantime? I know today it's very muddied by the "seeking work" criteria -- housewives who are staying home for now because there are no jobs and child care is spendy and so they aren't ACTIVELY seeking work don't count, and underemployment doesn't count.

Because farming today is mostly "factory farming" rather than diversified "family farming," the economic impacts on and from the agricultural sector are going to be very different, and the price of food is going to move differently.

Finally, problematic climate conditions and crop failures work differently in a modern agricultural economy than they did in the 1930s, due both to changes in agricultural practice and transportation, and due to changes in government policy that creates different incentives than it did back then.

In other sectors, the 1930s economy was heavily manufacturing-oriented. Today, I believe a majority of US workers are in service and knowledge positions, which will be affected radically differently than they were in the 1930s.

All of which is to say, the numbers might not need to match 1930s numbers for things to fucking suck at a Great Depression level. On the flip side, the economy might be better able to absorb 1930s-style blows than it was in the 1930s. I don't know. But I do know the economy today is SO radically different that comparing it to the 1930s and looking for similarities in how the *economy* will respond is not as useful as people seem to be pretending it is. Learning from the history of it is one thing, but pretending this is "another 1930" seems counterproductive.

@rpm773: I've always figured FDR had the single most unbeatable platform ever. "FDR: He Can't Make Things Any Worse Than They Already Are, But At Least You Will Now Be Able To Drink Again."

THAT makes me feel like we're ... maybe not in a depression, but in a downturn that's getting ugly and is going to hurt a helluva lot more than a "mere" recession.

And I'm in a part of the country where the economy has remained *fairly* robust, at least by comparison.

@Gokuhouse: Nope, actually just got a raise!!!

Looks like we might just be in a depression according to them.

[wordnetweb.princeton.edu]

I'm deperssed - does that count?

It's not hard to figure out what happened either. A bubble burst...a HUGE bubble. It shook the foundations of the banking system. Once we get banks loaning again things will start to turn around. After they start loaning I feel like we'll have to raise interest rates significantly for a few years for people to start investing and we'll be right back where we started: watching a new bubble grow.

The Great Depression of the 1930s and similar localized events are associated with exceptional cynicism in government and a lapse or collapse in the cohesion of civil society. Stability was only restored with massive overhauls in both social and economic institutions: nationalization of industry, the invention and expansion of the welfare state, and a general abandonment of the principals of laissez-faire economics.

Formulating statistical definitions of a depression suggests that it is merely a prolonged recession. During Roosevelt's first inauguration, machine gun nests were installed on the White House lawn to ensure the President's security. Don't think an a depression is something you can quantify.

Unfortunately, this is largely a qualitative measure, and more often than not, can only be seen retroactively.

is it "losing" if you recently won the lottery and lost all interest in working?

February figures come out on the 6th

@Gokuhouse: No, but several of my coworkers have.

@Gokuhouse: Yes. I lost my job in November. Fortuately, I was able to get a new job almost immediately and take a few days off for mental health.

/sarcasm off

now where are my flappers?

@Razorgirl: We just need to get the economy set up with a supply of Prozac! and as for the people it might just be Darwinian population control, but then "I still have a job" and that is my mantra in the morning thanks to my wife.

For what it is worth...this is a good/funny related story:
A man lived by the side of the road and sold hot dogs. He was hard of hearing, so he had no radio. He had trouble with his eyes, so he had no newspaper. But he sold good hot dogs.

He put up a sign on the highway telling how good they were. He stood by the side of the road and yelled, 'Buy a hot dog, mister.' And people bought. He increased his meat and bun order, and he bought a bigger stove to take care of his trade. He got his son home from college to help him. But then something happened.

His son said, 'Father, haven't you been listening to the radio? There's a big depression on, the international situation is terrible, and the domestic situation is even worse.' Whereupon the father thought, 'Well, my son has been to college. He listens to the radio and he reads the papers, so he ought to know.'

So the father cut down on the bun order, took down his advertising signs, and no longer bothered to stand on the side of the highway to sell hot dogs.

His hot dog sales fell almost overnight. 'You were right, son,' said the father to the boy, 'We are certainly in the middle of a great depression!'

Yes.

I wondered about that. Thanks for the info.

No but we are being bought. I'm worried because every time I have tried to put something aside, my old car ate it up.

Times are getting tough. My wife and her coworkers have taken a 16.75% pay cut (the ones not layed off) and I am working 36 hrs vs 40 hrs. I have a few children who can't find jobs with college degrees. I think things will get alot worse before they get better. Does any one know if they calculated the unemployment rate the same in the 30s. There are alot of people who have fallen off the unemployment rolls who are still unemployed and they don't count in the figures. The county I live in has a 10% rate but its really about 30% if you count everyone who wants to work.

A slowdown is when your neighbor loses their job.

A recession is when you lose your job.

A depression is when an economist loses their job.

BTW - great photo for this post. For those of you not from New Jersey (which I hope is most of you), that is a sculpture featured at the Grounds for Sculpture in Hamilton NJ. "Bread line" I believe is the name.

It's quite moving in person.

Stagflation is an economic situation in which inflation and economic stagnation occur simultaneously and remain unchecked. You end up with higher prices, the same salary and diminishing job security.

[www.cato-at-liberty.org]

They've also frozen salaries, although our business unit got a 6% bonus because we rock.

4:15 on Friday. Time for some scotch.

Gallup.com has a lot of good polls that indicate the mood of the country, including a graph that indicates how many people are hiring versus reducing/letting go. One poll I liked was "Did you worry about money yesterday?" 60% did not worry.

@rugman11: If the early 80s wasn't a depression, this certainly isn't one either.

I have friends who have lost jobs but honestly they were unskilled or clerical work.

Take that stress, compare it to the stress of unemployment, report back.

At the rate this is going, McD's, here I come.

1930 - -8.6%
1931 - -6.4%
1932 - -13%
1933 - -1.3%
2008 - +1.3%
4Q 2008 - -3.8%

So we haven't had an entire year of negative GDP growth yet and would have to double our 4th quarter growth (in the wrong direction) to equal the contraction seen in 1930.

During the Great Depression unemployment was as high as 25%. We're sitting at around 7.5%. During the Great Depression wages fell (for those who still had jobs) 42%. In 4Q 2008, the median wage was UP 4% over 2007.

In other words, the economy would have to get twice as bad as it is now in order to reach 1930 levels. I'm not sure if that will happen or not. But as for now: No, we are not in a depression.

What is it if you lose 20% of your job? (Like me! Like me!)

I don't remember specifically what it was, but there's one aspect of a typical recession that we haven't met, and there are several aspects of a depression that we have met.

If we do end up in what can be agreed upon as a depression, I don't think it will be as deep as the one in the 30s. That one was accompanied by the Dust Bowl, which we may not experience. But then again, with global warming, who can tell for sure?

@Gokuhouse: No, but there will be 10,000 reductions this year, with the first 4,500 in February.

Have you lost your job?

NO

No. We're not lining up at the docks yet.

A recession is when your neighbor loses their job.
A depression is when you lose your job.