The Lost Decade

I liked this USA Today chart showing the latest census data:

This, I think, does a great job of illustrating the fact that the asset price collapse –> recession –> lost decade cycle is really something that started 10 years ago rather than a forward-looking risk. It’s often said that the 2001 recession was “brief” and “mild,” but the employment and income situation kept deteriorating for years and neither the employment-population ratio nor wages ever re-obtained their previous peak. The longer we go on not effectively addressing the additional labor market trauma of 2008-2009, the more this all merges into one giant pool of long-run economic dysfunction.