Last Friday, the Bank of Canada governor Mark Carney said that “we believe the economy will grow this quarter”, which technically means the recession in Canada was over in June.
On Monday, Trade Minister Stockwell Day repeated this claim in the Penticton Western News, writing “I’m not kidding. The recession is over… Last week, after pouring over all the numbers he was able to declare, not on a whim but based on economic fact that the nasty ‘R’ word no longer applied to Canada.”
But then this Tuesday, when Finance Minister Jim Flaherty was asked if the recession is over he said ”No, I think we will have to look back as we always do and look at this quarter. There are good signs that the economy has stabilized, and there are the beginnings of a recovery. And I wouldn’t put it any stronger than that.”
Transport Minister John Baird had a similar statement on Wednesday, “What we want to make sure of is that we don’t pop out the champagne just yet. There’s a lot of Canadian families that are still feeling the pain of the economic times that are going around the world.”
I prefer Mr. Flaherty and Mr Baird’s cautious statements, especially with the jobless rate at an 11 year high and EI payments at their highest level since Statistics Canada began tracking in 1997. More importantly, being too much of an economic cheerleader might lead to another crash if, 3 months from now, the projection turns out to be incorrect. Ultimately, these mixed messages will not help a nervous stock market or a fragile consumer confidence.
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Tom Drake is the owner and head writer of Canadian Finance Blog.
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It depends on how one defined “Recession” too
Technically, Recession is “two down quarters of GDP”, which we may not see come next quarter, hence BoC can say it’s over
But whatever, it is nowhere near over in my mind with the high jobless rate. But it is stabilizied and moving sideways now
The Recession is far away from over,we still need a long way to go.
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Well according to This questionnaire
USA is the last country in the world, which will come out of recession. Apparently it is based solely on people’s opinions, but the fact, that basically 75% of 100% USA citizens think, that recession is not over yet and 17% of them think, that it will not even be over until 2-3 years, is not realistic. I have no idea, whether people have serious financial problems or they just don’t think realistically.
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Recession being prevalent or not, is a secondary question. The matter of more significance is the the jobless rate being low. If the citizens are comfortable with their way of living and have confidence to fight the recession, its a good news. So, with all cautious statements being followed I personally opine that its safe if we are leading a financially disciplined life.