ECRI’s Lakshman Achuthan is on Bloomberg Surveillance with Tom Keene, vigorously defending his recession call, which many have called dead wrong.
In case you’re catching up, back in September 2011 Achuthan predicted the U.S. would go into recession. Advisor Perspectives’ Doug Short has a great summary of all of Achuthan’s calls and appearances since then.
Achuthan essentially lays out two parts to his defence this morning.
First, a recession is not measured as two consecutive quarters of GDP. Most actually agree with Achuthan here. Indeed, the official recession call, which is made by the NBER, is based on four big economic indicators: production, employment, income, and sales.
Based on his interpretation of these indicators, Achuthan believes that the U.S. went into recession in the middle of 2012.
Second, he says that you will not be able to tell if he’s wrong until the end of this year. This is because a recession only becomes clear in the rearview mirror.
He cautioned Keene about rushing to judgement. But Achuthan effectively gave himself a one month deadline.