“The end of the world appears to have been postponed. We’ve had an extraordinarily terrible crisis though we’ve probably hit bottom as world output has turned positive.”
-Paul Krugman, Princeton University
A few bullet points from Krugman’s comments in Helsinki:
• The U.S. may have emerged from recession at the end of July or in August
• Growth may be returning after 4 consecutive Qs of negative GDP — the longest contraction since record-keeping began in 1947.
• U.S. has $1.1 trillion in annual capacity “staying idle.”
• The world has become “highly subject” to financial bubbles;
• There was a “remarkable” willingness to ignore signs of the bubble — or more politely, to fail to recognize it.
I suspect we won’t see a similar error this time, and that implies the official mark of the recession being over may be later than many economists (including Krugman) believe.
Krugman Says ‘End of the World Postponed’ as Economy Hit Bottom
Bloomberg, Sept. 21 2009