The United States economy is now in the midst of its first recession since late 1982. Gross National Product fell by 1.6 percent during the October ‑ December period and declined at an even more rapid 2.8 percent during the January ‑ March period. This is the ninth recession since the end of World War II. In this forty‑six year time span the average length of a recession has been eleven months. The longest recession during this post war period has been approximately sixteen months. The National Bureau of Economic Research (NBER) believes that the recession actually started in late July of 1990, which predates the Gulf War. If this analysis is correct, it would imply that this recession should end sometime between June and December 1991. This time frame is suggested by the past performance of the United States economy during recession.

     A word of caution, historic data can be a useful tool for analysis but do not usually provide a foolproof means of forecasting the future due to the unique character of each recession and the dynamic nature of the United States economy. This dynamic nature ensures that major structural and institutional changes occurring over the course of time will affect the way in which economic events are transmitted throughout the economy. Major fundamental changes over the decade would include (but not be limited to) the massive federal deficit, the emergence of the service sector, the globalization of the world economy, improvements in the telecommunications and transportation networks, and problems in the country's financial service sector, et. al. Thus, the best estimates of when the recession may end are all predicated on the heroic assumption that the economy has not undergone any fundamental changes since the end of World War Il.

     Turning our attention to matters closer to home, the industrial Midwest is performing much better than during the recession of the early 1980s. The economy of the so‑called rust belt has adapted itself over the past decade in such ways as to reduce the pain and dislocations of recession. In 1982 the Midwest saw manufacturing output fall by 44 percent compared to just 13 percent for the nation. Midwest business, especially manufacturing, responded to the challenge and has become more efficient and export oriented over the decade. Further, the region has become more diversified in its economic base with the service sector becoming a more important part of the economy. Given this and the fact that the crucial banking sector in the Midwest is by most standards the soundest of any region in the country, it is not surprising that this part of the country has outperformed many of the other regions. This recession has been concentrated in the ailing East and West Coast economies and in their financial services, defense, and real estate sectors. Even though the Midwest and Wisconsin economies are already being negatively affected by events on the coasts, the economic outlook for the Midwest should remain much brighter than just a decade ago.