Just How Bad Will It Get?

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Via Brad DeLong, Menzie Chinn compares the CBO’s February and March projections of economic disaster and notes that they’ve become considerably more disastrous in only a month:

Notice that the no-stimulus counterfactual output gap and unemployment rates are noticeably worse now than only a month ago (see this post). For 2010, the February counterfactual was -6.3% of GDP, now around -10%; the February counterfactual for 2010 was 8.7% unemployment, now it’s nearly 11% (I’m eyeballing the current counterfactuals off of Figures 2-1 and 2-2)….My guess is that that “massive” stimulus is going to look a lot less “massive” given the severity and duration of this recession.

A month ago CBO estimated that unemployment would hit 8.7% in the absence of a stimulus package.  Now they think it would have been around 10.5%.  With the stimulus, they think it will top out at a little over 9%.

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IT'S NOT THAT WE'RE SCREWED WITHOUT TRUMP:

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This is a big one for us. So, as we ask you to consider supporting our team's journalism, we thought we'd slow down and check in about where Mother Jones is and where we're going after the chaotic last several years. This comparatively slow moment is also an urgent one for Mother Jones: You can read more in "Slow News Is Good News," and if you're able to, please support our team's hard-hitting journalism and help us reach our big $350,000 goal with a donation today.

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