Is the Recession Over? What the Coincident Indicators Say

When the committee that figures this stuff out meets, they emphasize the four coincident indicators of the economy.  Before looking at the latest charts, keep in mind that we are mostly looking at data through June (for employment, through July).  The Wall Street Journal survey finds that most of us economists believe that the recession is either over, or that August is the bottom and next month it will be over.  The belief that the recession is over is not based on hard data, but on an estimate of what the July data will be when published, and also on what the coming months will bring.  We won't know for sure that the recession is over until we are so far into the recovery that that another dip would be defined as a new recession, and not part of the current recession.  Got that?  In a nutshell, saying that the recession is over is making a forecast.

Now let's look at actual data on the four coincident indicators:

Only real business sales has turned up–so far.

Note to statistical purists: The official series for real business sales has not yet been released for June.  I used the nominal business sales and the personal consumption deflator to estimate June data.  I'm sure it's very close to what will soon be published.