{"id":1040,"date":"2011-10-21T10:50:33","date_gmt":"2011-10-21T16:50:33","guid":{"rendered":"http:\/\/stateimpact.npr.org\/idaho\/?p=1040"},"modified":"2011-10-21T10:50:33","modified_gmt":"2011-10-21T16:50:33","slug":"q-a-boise-state-university-economics-professor-don-holley-on-recession-vs-recovery","status":"publish","type":"post","link":"https:\/\/stateimpact.npr.org\/idaho\/2011\/10\/21\/q-a-boise-state-university-economics-professor-don-holley-on-recession-vs-recovery\/","title":{"rendered":"Q & A: Boise State University Economics Professor Don Holley on Recession vs. Recovery"},"content":{"rendered":"

Q: <\/span>What is a recession?<\/p>\n

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A: <\/span>When you talk about a business cycle, you have a downturn and an upturn. The downturn is the recession and the upturn is the recovery.\u00a0 Once you hit the bottom and start to come up, you\u2019re in recovery, but you certainly haven\u2019t gotten back to where you were before.\u00a0 Even a year and a half later, 2 years later, we\u2019re not back to where we were in 2007.\u00a0 So, although we\u2019re technically in a recovery, we certainly haven\u2019t recovered back to where we were before.\u00a0 The downturn, the bottom, we\u2019ve passed the bottom \u2013 but nowhere close to where we were.<\/p>\n

Q: <\/span>\u00a0Are you seeing signs of recovery in Idaho?<\/p>\n

A: <\/span>Employment has leveled off and has started to increase.\u00a0 Home sales have stopped going down as fast as they were and have leveled off \u2013 in some places they\u2019re starting to increase.\u00a0 Housing prices aren\u2019t falling as fast as they used to.\u00a0 Auto sales are up from a year ago \u2013 they\u2019re still half of what they were 3 or 4 years ago.\u00a0 So yes, we see signs of recovery.<\/p>\n

Q: <\/span>Do those indicators matter to the person who still doesn\u2019t have a job?<\/p>\n

A: <\/span>Yes, it means it\u2019s not quite as risky as it was before.\u00a0 If we were still in a recession, if things were still going down, it\u2019d be much worse.\u00a0 Two years ago if you got laid off chances are you\u2019d be laid off for 6-12 months, now you won\u2019t be able to find work for 5-9 months.\u00a0 It\u2019s still tough, but not quite as bad.<\/p>\n

Q: <\/span>Does the word<\/strong> recession matter?<\/p>\n

A: <\/span>When we talk about the Great Depression \u2013 it lasted from 1929 to 1941 \u2013 but technically, from the point of view of the economist, the Depression only lasted from 1929-1933, from \u201933 on we were into recovery. \u00a0But things were so poor for that 10 to 12 year period, that we called it the recession even though we were in a recovery for most of that.\u00a0 We\u2019re in a recession.\u00a0 In the popular use of the term, we\u2019re still in recession, even though the economy isn\u2019t in decline \u2013 we\u2019re still in recession, we\u2019re not back to where we were before.<\/p>\n

Q: <\/span>There\u2019s a lot of talk about slipping into a double-dip recession.\u00a0 Would it be easy for Idaho to slip into a double-dip, given the fragility of the economy?<\/p>\n

A: <\/span>If you\u2019re going to track the economy, you want to track spending, and the reason that we\u2019re not coming out of the recession very fast is because spending isn\u2019t recovering very fast; household spending, business spending, government spending, and foreign spending.\u00a0 And right now, because of the decline in housing prices and the decline in the stock market, (U.S.) households lost about $16 trillion in net worth and they aren\u2019t going to start spending until they feel comfortable \u2013 until they get that net worth back.\u00a0 So, you have to recover the net worth or feel like it\u2019s recovering, feel secure in their jobs \u2013 or if they lost it, feel comfortable that they\u2019ll find a new one in a few weeks rather than a few months or years.\u00a0 And when that happens, then they\u2019ll spend money and they\u2019ll be spending enough money to spur production and spur employment.<\/p>\n

Q: <\/span>How do you turn around that confidence on the state level?<\/p>\n

A: <\/span>Homeowners thought they were living in a $400,000 home and now they\u2019re living in a $200,000 home \u2013 they lose their job and instead of being out of work for 3-6 weeks they\u2019re out for over half a year.\u00a0 Consequently, in that kind of an economic environment they aren\u2019t going on vacation, buying cars, there are a lot of things they aren\u2019t doing.\u00a0 It\u2019s the wise thing to do.\u00a0 At the state level \u2013 every state is such an integral part of the national economy, there\u2019s not much you can do at the state level, unless you discover oil or something miraculous happens. \u00a0We\u2019re in for a long one \u2013 this will be a defining moment.\u00a0 Your kids will look back and think \u2018how did Mom and Dad will deal with this one?\u2019<\/p>\n","protected":false},"excerpt":{"rendered":"

Q: What is a recession? A: When you talk about a business cycle, you have a downturn and an upturn. The downturn is the recession and the upturn is the recovery.\u00a0 Once you hit the bottom and start to come up, you\u2019re in recovery, but you certainly haven\u2019t gotten back to where you were before.\u00a0 […]<\/p>\n","protected":false},"author":40,"featured_media":1044,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[12],"tags":[101,40,46,74],"acf":[],"_links":{"self":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts\/1040"}],"collection":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/users\/40"}],"replies":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/comments?post=1040"}],"version-history":[{"count":5,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts\/1040\/revisions"}],"predecessor-version":[{"id":1048,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/posts\/1040\/revisions\/1048"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/media\/1044"}],"wp:attachment":[{"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/media?parent=1040"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/categories?post=1040"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stateimpact.npr.org\/idaho\/wp-json\/wp\/v2\/tags?post=1040"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}