Comparing Economic Recoveries: Ritholtz Chart

Barry Ritholtz is a Bloomberg View columnist. He founded Ritholtz Wealth Management and was chief executive and director of equity research at FusionIQ, a quantitative research firm. He blogs at the Big Picture and is the author of “Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy.”
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Source: Crestmont Research

Ed Easterling, president of Crestmont Holdings LLC, created the chart above comparing various economic recoveries. He selected those that followed similar annual declines in real gross domestic product.

As the chart shows, the present economic recovery is the most sluggish we have seen. We can attribute this to numerous factors (i.e. take a guess):

• Depth of the prior balance sheet recession;
• More modest federal spending and hiring than past recessions;
• Ongoing deleveraging;
• Economic weakness in emerging markets;
• Political troubles in the euro zone;
• And etc.

Whatever the reason for rationalizing the current weakness, the chart strongly suggests it isn't your imagination: This is a subpar, mediocre recovery.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

To contact the author on this story:
Barry L Ritholtz at britholtz3@bloomberg.net