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TitleUsing Data Buffet: U.S. recessions
AuthorKarl Zandi

Was the U.S. economy in recession in any given year? How can I show this using Data Buffet and in Moody's Analytics Power Tools?


Is the U.S. in a recession this month?  Moody's Analytics provides two time series (monthly and quarterly) that track whether the U.S. economy is in recession: The values is "1" if so or "0" if not.  The series start at January 1857 and are updated on the first day of each month or quarter, respectively.  They are provided by the National Bureau of Economic Research (NBER), the official arbiter of recessions for the United States.  (Their definition is more nuanced than the commonly-quoted "two quarters of declining GDP.")

Note: Be careful with your date formatting.  Because the series start in the nineteenth century, a two-digit year is ambiguous.

How can I show recessions by year?  You will need to "down-convert" one of the series to a lower, annual, frequency.  The result will show whether the U.S. economy was in recession at any time during the year.

If using a Data Buffet basket, use this formula to convert the monthly recession series:


As an alternate you may also use the following formula (in Data Buffet basket only):


For the past decade, the output will show "1" for the years 2001, 2007, 2008 and 2009, and "0" otherwise.

If using Moody's Analytics Power Tools for Microsoft Excel (v.8), open the Series Wizard and, instead of a single mnemonic, specify this formula:


A nonzero value indicates a recession was in effect for some part of the year.

Under the default wizard settings, the resulting worksheet function will look something like the following, and the output will be horizontal. ???


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