We're sure the National Bureau of Economic Research's announcement Monday that the nation is officially in a recession didn't come as news to anybody.
The real-estate market has long been in decline, manufacturing activity has been on the wane for months now, retail sales are still sluggish, and many Americans are wondering whether they'll still have a job next month or anything left in their pension account when they retire.
Yet the stock market acted like this was all a big surprise, with the Dow Jones industrial average shedding 679.95 points Monday. Shows you what the people on Wall Street know.
How about looking on the bright side? At least they didn't declare what we're experiencing a depression.
Throughout the fall campaign, candidates and the Bush administration were reluctant to use the "R" word in talking about the business climate. But economists now tell us the current downturn began last December.
But there is a glimmer of hope. Buyers are showing a renewed interest in homes in Massachusetts.
While home prices continue to fall, home sales in September and October actually increased over the levels reported a year ago. According to the Massachusetts Association of Realtors, home sales in October were up 6.6 percent over the level reported in October 2007.
Runaway lending and injudicious borrowing combined to inflate home prices to unreasonable levels. We're now seeing a correction in those home values. That process will continue until prospective buyers no longer recoil in shock when told the asking price of a property. When prices begin to make sense again, people will buy.
That won't be the end of the recession — lenders will still need to regain enough confidence to provide qualified borrowers with loans. But it will be the beginning of the end. A two-month uptick — however slight — in home sales in Massachusetts is a hopeful sign.
Historically, recessions last between eight and 12 months. Now this one may be more serious than most, but on the other hand, maybe we have, in fact, turned the corner and next year about this time they'll be telling us the nation is officially in a recovery that began way back in December 2008.
