In March 2009, I watched our Federal Reserve Chairman Ben Bernanke on 60 Minutes. At the time the Dow Jones had rebounded to just above 7200 after hitting a low of 6626 a few days before. The recession was not yet over, and financial markets were still in shock from that historic “Lehmann Day.” During the interview, the Chairman said that the “green shoots of economic revival” were evident.
Suddenly every economist, journalist and analyst were using the term “green shoots” in their daily vernacular. It was heard at the water cooler, in the board room, over the airways and seen in the papers.
“I see green shoots in the data.”
“Green shoots or yellow weeds?
“Finally, some green shoots!”
While the recession did end in mid-2009, we can’t say the last few years have been smooth. Today, four years into this economic cycle, homeowners still struggle, our unemployment rate is still elevated, we continue to live in an environment with immense uncertainty abroad and at home, and on some days I get the feeling that another black swan is around the corner.
Still, I feel like I’m seeing some green shoots today.
As I write this blog, the Dow may eclipse the 13,000 mark, a level unseen since before the recession. This represents a psychological breakthrough, on the heels of encouraging news out of Europe. Although it feels fragile, it is most welcome.
Secondly, last week, the number of workers filing for unemployment benefits fell to the lowest levels since before the financial crisis nearly four years ago. It is now below 350,000, and economists say we need to be below 400,000 to be in recovery mode. When Bernanke made his comments on 60 Minutes, the number was closer to 650,000. We are back to pre-recession levels, another encouraging note.
Lastly, the U.S. economy added 243,000 jobs last month and 203,000 jobs in December. Economists often say that we need to see sustained job creation in the vicinity of 250,000 for a sustained decline in the unemployment rate and real traction in this economic recovery.
These are real buds in time for an early spring. Could they be the harbinger of a full economic recovery?