Indications economy on the fritz before credit crunch


Economist’s View carries a post at VoxEU by Mike Elsby, Bart Hobijn, Aysegul Sahin.

This especially caught my attention:

Figure 1 also highlights a curious fact absent in popular discussions of the crisis. Unemployment in the US had already begun to ramp up in early 2007, long before the official recession start date in December 2007 and the vagaries of the financial crisis that came to a head in the latter half of 2008. Figure 1 suggests that the initial impulse to the current recession may not have been the credit crunch, but rather that the credit crunch aggravated already worsening economic conditions. …