Today in Economics 520, our Professor was teaching on the three theories of Money Demand: Quantity Theory, Keyne's Liquidity Preference Theory and Milton Friedman's Modern Theory. While mentioning that the Fed’s interest rate is indicative of the strength of our economy, he rhetorically asked the class, “What is our country in right now? Are we in an expansion period or a recession?”
A guy in the front row yelled out, “Well, sir, technically right now we’re expanding.”
My Professor burst out laughing. He was laughing so hard he couldn’t catch his own breathe. When the Professor finally found the strength to muster a few words, he said, “Are you crazy? Do you really believe that? I’m sorry, but America is in trouble right now. Big trouble. The TV and the President may be telling you that everything will be alright, but believe me, as an economist I’ll tell you—America is in a recession.”
(It’s interesting to note that my Professor is not an American, but Korean. I’d assume that would remove some of the subjectivity from the matter. )
What surprised me most of all was the way that he laughed. I’ve never seen a Professor laugh at a student, but I guess to this Economist the simple suggestion of us not being in a recession was absolutely hilarious gibberish.