Is the World Out of Recession?

Ramnath, N. S. (2010). Is the world out of recession? Retrieved March 24, 2010 from: http://www.forbes.com/2010/03/19/forbes-india-is-the-world-out-of-recession.html?feed=rss_home#

This article appears in Forbes India and on forbes.com Web site and attempts to answer the question: Is the world out of recession? The answer is yes if you go by the textbook definition of recession, which defines recession as two consecutive quarters of economic decline and the U.S. economy grew by 5.7% in the last quarter of 2009. The answer is not so definitive if you look at many of the other economic indicators. One important indicator is the job market. In the US and many other developed economies, payrolls continue to decline; in developing countries, the job market is improving. Consumer confidence is another indicator and in the US, the CCI came down to 46 in February from 56.5 in January. Merger and acquisition activity has been slow in the past two years; however, there is some recent activity picking up in some parts of the world. Gold prices are another indicator, as the economy weakens; gold prices go up and have for the past couple of years. More recently, prices have started declining, possibly indicating more confidence in other investments and an improved economy. Finally, surveys show that executives are seeing improvements in their business and are somewhat optimistic of improvement in the next six months. These indicators are important for managers to understand because it’s important to know what is going on in the economy and what to expect next so they can be ready for and take advantage of the recovery as it unfolds.