Are we in a recession?

It’s interesting to hear different people’s opinions at the World Economic Forum about what the economy is going to do this year. Most people here believe we’re in the midst of a recession, which technically is two quarters of negative growth. There’s certainly many here who are gloomy about the future, but there is definitely lots of positivity too.

I spoke with Steve Forbes last night (yes, that Steve Forbes) and he thinks that the doom and gloomers shouldn’t be listened to. He sees one quarter of bad news and then sees the economy coming back in the second quarter.

I forget his name, but a senior partner at Accel Venture Partners told me while we were waiting for a bus together that he’s watching the sales and other data from 250 startups reporting to Accel and he sees nothing but growth and is very optimistic. That optimism has been shared among the VC’s I’ve run into this week.

Google execs are upbeat and are hiring and so are many other companies. Startups continue getting funded. Facebook’s executives tell me they are continuing to hire and expand at a rapid pace.

On the other hand, the subprime problems are very real. I know a couple of people who are getting kicked out of their homes because they couldn’t afford to keep up with payments. Now, you can blame these people, but one of these families has an autistic child and so the mom can’t work. That wasn’t something they planned on, but they are getting evicted nonetheless and this is in Silicon Valley in Saratoga, a pretty rich community. Certainly real estate values are under pressure, in some communities in San Joaguin Valley in California housing prices are seeing huge drops (I’ve heard stories of homes being sold for $350,000 in neighborhoods where prices were $600,000 two years ago).

So, are we in a recession? Or are things going to roar ahead in 2008? What are you seeing from your vantage point?

163 thoughts on “Are we in a recession?

  1. I believe that a Recession is on it’s way. I vave a good paying job, as does my husband, and were ok. But for those who do not have a good job and are only making min. wage, they have to pick and choose which bills to pay each month. The stimulus check that was sent out to buy things to boost the economy….everyone that I know spent it on trying to catch up on back bills. The upper class may think that all is well, but let them walk in lower class shoes and see if they have the same view point.

  2. I believe that a Recession is on it’s way. I vave a good paying job, as does my husband, and were ok. But for those who do not have a good job and are only making min. wage, they have to pick and choose which bills to pay each month. The stimulus check that was sent out to buy things to boost the economy….everyone that I know spent it on trying to catch up on back bills. The upper class may think that all is well, but let them walk in lower class shoes and see if they have the same view point.

  3. Recession is relative! Is the country in a recession? Maybe not by the means of the definition, but is sure isn’t progressing diligently. Unemployment is up, and in certain parts of the country it’s insanely high! You can definitely say that the midwest is in a recession.

  4. Recession is relative! Is the country in a recession? Maybe not by the means of the definition, but is sure isn’t progressing diligently. Unemployment is up, and in certain parts of the country it’s insanely high! You can definitely say that the midwest is in a recession.

  5. Why do I care more about the American worker than the truly impoverished worker in a 3rd world country who’s children are much more likely to be actually starving? I never have understood this argument that one is more important than the other.

  6. Why do I care more about the American worker than the truly impoverished worker in a 3rd world country who’s children are much more likely to be actually starving? I never have understood this argument that one is more important than the other.

  7. It is clear that the only real security in life is money in the bank.
    We need to start helping ourselves by making it a priority to “buy American” made products whenever possible. We need to refocus our efforts on “Made in the U.S.A.” instead of supporting products made offshore or using services now being set up in record numbers offshore. As a nation, we continue to give it all away. It is financial suicide. Now, despite the fact econimc statistics say we are not in a recession, why are vendors who are setting up at nationwide flea makets routinely selling one item for $14.95 after a days work? After the booth fee and gas costs, they are down about $100. Based on sales, it appears people are not spending money, when they do spend it is with a credit card, and the people trying to earn an extra buck to pay for living expenses are going in the whole for trying.

  8. It is clear that the only real security in life is money in the bank.
    We need to start helping ourselves by making it a priority to “buy American” made products whenever possible. We need to refocus our efforts on “Made in the U.S.A.” instead of supporting products made offshore or using services now being set up in record numbers offshore. As a nation, we continue to give it all away. It is financial suicide. Now, despite the fact econimc statistics say we are not in a recession, why are vendors who are setting up at nationwide flea makets routinely selling one item for $14.95 after a days work? After the booth fee and gas costs, they are down about $100. Based on sales, it appears people are not spending money, when they do spend it is with a credit card, and the people trying to earn an extra buck to pay for living expenses are going in the whole for trying.

  9. To the the guy who said he has 20 job offers and he is not even searching for a job. I am happy for you. My guess is you are either from Goldman Sachs, JP Morgan,Morgan Stanley, Merrill Lynch and probably from MIT, Harvard, Wharton, Univ. Chicago, Darden, Yale or Stanford MBA or undergrad. Well, how many of the average American have that background??? We are talking about recession average American who comprise the majority of the population. The 30Billion Federal Reserve to bail out Bear Stearns came out from the Average Americans’ taxes. But who got those big fat bonuses after the Average American can’t afford to pay their home loans? The point is although there could be greed on most Ave. Americans (either because of greed or ignorance since they simply listened to those financial institutions decorated by their handsome Ivy League degrees), who really got the better end of the deal? The average american is losing his house, while those with their creative financial solutions got their big fat checks and got bailed out with 30B using the Ave. American’s taxes . And yes, most of those who created this creative financial risky loan still have 20 job offers while the Ave. American is homeless queing up for his SSS to have something to eat. I have nothing against the rich and I do believe in Ivy League education but I do hope that the upper class who are really running our country both in the government and private sector will use their education not to serve themselves but to give back to the country.

  10. To the the guy who said he has 20 job offers and he is not even searching for a job. I am happy for you. My guess is you are either from Goldman Sachs, JP Morgan,Morgan Stanley, Merrill Lynch and probably from MIT, Harvard, Wharton, Univ. Chicago, Darden, Yale or Stanford MBA or undergrad. Well, how many of the average American have that background??? We are talking about recession average American who comprise the majority of the population. The 30Billion Federal Reserve to bail out Bear Stearns came out from the Average Americans’ taxes. But who got those big fat bonuses after the Average American can’t afford to pay their home loans? The point is although there could be greed on most Ave. Americans (either because of greed or ignorance since they simply listened to those financial institutions decorated by their handsome Ivy League degrees), who really got the better end of the deal? The average american is losing his house, while those with their creative financial solutions got their big fat checks and got bailed out with 30B using the Ave. American’s taxes . And yes, most of those who created this creative financial risky loan still have 20 job offers while the Ave. American is homeless queing up for his SSS to have something to eat. I have nothing against the rich and I do believe in Ivy League education but I do hope that the upper class who are really running our country both in the government and private sector will use their education not to serve themselves but to give back to the country.

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