Monday, January 28, 2008

2008 Recession odds down to 16%?

There have been some recent posts about how unemployment remains low, where in previous recessions, unemployment spiked up sharply. This WSJ Economics blog post talks about Tim Kane's model, which is predicting a 16% chance of recession. A few days ago, Mark Perry had this graph at his blog:

Of course, all this could be a warmup for Bush's last State of the Union address.

Here's the latest Intrade recession chart:


UPDATE: Greg Mankiw links to another Kane paper, which focuses on unemployment insurance predictiven power of coming recession, and which is currently pricing a 35.5% chance for recession.

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