Potential Output and Recessions: Are We Fooling Ourselves?

"The economic collapse in the wake of the global financial crises (GFC) and the weaker-than-expected recovery in many countries have led to questions about the impact of severe downturns on economic potential. Indeed, for several major economies, the level of output is nowhere near returning to pre-crisis trend (figure 1). Such developments have resulted in repeated downward revisions to estimates of potential output by private- and public-sector forecasters. In addition, this disappointment in post-recession growth has contributed to concerns that the U.S. economy, among others, is entering an era of secular stagnation. However, the historical experience of advanced economies around recessions indicates that the current experience is less unusual than one might think. First, output typically does not return to pre-crisis trend following recessions, especially deep ones. Second, in response, forecasters repeatedly revise down measures of trend."

http://www.federalreserve.gov/econresdata/notes/ifdp-notes/2014/potential-output-and-recessions-are-we-fooling-ourselves-20141112.html

“There Will Be Growth in the Spring”: How Well do Economists Predict Turning Points?

"Since the onset of the Great Recession, much of the world has been in a state of economic winter: nearly 50 countries were in recession in 2009 and 15 countries slipped into recession in 2012. After weak global growth in 2013, economic forecasters are predicting a rosier outlook this year and next. Can these forecasts be trusted?"

"As shown above, none of the 62 recessions in 2008–09 was predicted as the previous year was drawing to a close. However, once the full realisation of the magnitude and breadth of the Great Recession became known, forecasters did predict by September 2009 that eight countries would be in recession in 2010, which turned out to be the right call in three of these cases. But the recessions in 2011–12 again came largely as a surprise to forecasters."

http://www.nakedcapitalism.com/2014/04/will-growth-spring-well-economists-predict-turning-points.html

Why is the Recovery so Agonizingly Slow?

"Recessions that are driven by a collapse of the financial sector, balance sheet recessions as they are known, are one of the most difficult types of recessions to recover from. That is because the collapse of the financial sector does great damage to the balance sheets of individual households. In the most recent recession, the typical household lost a considerable amount of home equity when the price bubble popped, stock values declined causing losses of retirement, education, and other types of saving, and widespread unemployment and underemployment caused households to use their accumulated saving just to survive month to month."

http://www.thefiscaltimes.com/Columns/2014/01/14/Why-Recovery-so-Agonizingly-Slow

Banki w stresie, czyli czarny scenariusz: recesja, bezrobocie, drogi frank...

"Wyobraźmy sobie, że przez kolejne dwa lata mamy symboliczny wzrost gospodarczy (grubo poniżej 1%), a w 2015 r. pojawia się recesja (spadek PKB o 1,3%). Bezrobocie rośnie z obecnych 11% do 16%. Kurs złotego do euro załamuje się o 30% (do franka szwajcarskiego też), a rentowność obligacji rośnie o 3% (punkty procentowe), bo kapitał zagraniczny ucieka z naszego kraju. Jednocześnie spada jakość portfeli kredytowych, a ludzie przestają lokować w bankach swoje oszczędności (bo spada zaufanie do sektora bankowego). Czy jakiś bank mógłby wówczas zbankrutować? Czy mógłby stracić płynność finansową i musiałby zaciągać w banku centralnym pożyczki, by regulować swoje zobowiązania? Odpowiedź na te pytania to clue stress-testów przeprowadzonych przez NBP."

http://samcik.blox.pl/2013/07/Zycie-w-stresie-czyli-NBP-i-czarny-scenariusz.html

[WSJ] IMF Admits Mistakes on Greece Bailout

"The International Monetary Fund has admitted to major missteps over the past three years in its handling of the bailout of Greece, the first spark in a debt crisis that spread across Europe.

In an internal document marked "strictly confidential," the IMF said it badly underestimated the damage that its prescriptions of austerity would do to Greece's economy, which has been mired in recession for the last six years.

But the fund also stressed that the response to the crisis, coordinated with the European Union, bought time to limit the fallout for the rest of the 17-nation euro area.

The IMF said that it bent its own rules to make Greece's burgeoning debt seem sustainable and that, in retrospect, the country failed on three of the four IMF criteria to qualify for assistance."

"The paper added that the targets and the underlying macroeconomic projections weren't revised to reflect what was actually happening in Greece for 18 months, until December 2011.
The IMF had originally projected Greece would lose 5.5% of its economic output between 2009 and 2012. The country has lost 17% in real gross domestic output instead. The plan predicted a 15% unemployment rate in 2012. It was 25%.

Slowing the pace of austerity would have helped Greece's economy, but wasn't politically possible, the fund said."

http://online.wsj.com/article/SB10001424127887324299104578527202781667088.html

PKB dla humanistów, czyli dlaczego myślimy, że jest recesja

"Spora część wyrażających takie wątpliwości może łatwo dojść do wniosku, że GUS oszukuje i ta nasza subiektywna recesja tak naprawdę jest obiektywna i naprawdę istnieje. Wydaje mi się, że ten wyraźny rozjazd między odczuciami "ulicy" a danymi statystycznymi bierze się z tego, że PKB to coś więcej niż tylko zachowania i odczucia gospodarstw domowych. Generalnie części składowe PKB można podzielić na takie, które każdy jest w stanie dość łatwo pojąć i takie, których prawie nikt tak do końca nie rozumie, a ci którzy rozumieją nigdy tego nie wytłumaczą reszcie, bo to jest zbyt zagmatwane."

http://rafalhirsch.blogspot.com/2013/05/pkb-dla-humanistow-czyli-dlaczego.html

Natixis - Potential GDP

Tym razem raport francuskiej instytucji NATIXIS o konsekwencjach przeszacowanego potencjalnego PKB w okresie po recesji (w kontekście inflacji czy strukturalnego bezrobocia). Bez konkretnych prognoz liczbowych, ale też da się czytać. :)

http://cib.natixis.com/flushdoc.aspx?id=67092