What is a 'Pale Recession'

A pale recession is a phrase used in May 2008 by former Federal Reserve Board Chairman Alan Greenspan to describe an economic environment in which recession has not yet hit all the areas of the economy. In particular, Greenspan was speaking of the U.S. employment numbers at the time, which had not yet seen as significant a decline as would be expected in a full recessionary environment, which is generally marked by a broad decline in economic activity across the economy.

BREAKING DOWN 'Pale Recession'

Greenspan used the term "pale recession" in a television interview with Bloomberg on May 4, 2008. When asked whether the U.S. was in a recession he responded, "We're in a recession ... but this is an awfully pale recession at the moment. The declines in employment have not been as big as you'd expect to see."

Greenspan-isms

Alan Greenspan served as Federal Reserve Chairman for 19 years under four Presidents. In this role, he was responsible for leading the Federal Reserve Board in what amounts to an executive chairman position. His main responsibility was to carry out the mandate of the Federal Reserve, which is charged with maintaining stable prices, high employment and moderate inflation in the U.S. economy. As the public face of the Fed, Greenspan was well known by legislators and the general public, and his testimonies and speeches were highly anticipated and followed. He became known for somewhat rambling oratories laden with terms such as "crony capitalism" and "irrational exuberance," which in turn promptly popped up in headlines and conversations across the nation. "Pale recession" is an example of such a term.

RELATED TERMS
  1. Fed Speak

    Fed speak is a phrase used to describe former Federal Reserve ...
  2. Infectious Greed

    A phrase used in his July 2002 testimony before the Committee ...
  3. Growth Recession

    Growth recession describes an economy that is growing at such ...
  4. Economic Recovery

    An economic recovery is a period of increasing business activity ...
  5. W-Shaped Recovery

    An economic cycle of recession and recovery that resembles a ...
  6. Double-Dip Recession

    A double-dip recession is when a gross domestic product (GDP) ...
Related Articles
  1. Insights

    Alan Greenspan: 19 Years In The Federal Reserve

    Follow the economic glories and bumbles in the career of the previous Fed chair.
  2. Insights

    Alan Greenspan: Gold Is Safest Store of Value Right Now

    Alan Greenspan is sounding the alarm on out-of-control entitlements and inflation. Find out why he advocates for a return to the gold standard.
  3. Insights

    Greenspan Fires a Salvo at Dodd-Frank Reforms

    Former Federal Reserve Chairman Alan Greenspan wants to repeal the Dodd-Frank financial reform bill, saying that it has not worked at all.
  4. Insights

    'Irrational Exuberance' 20 Years On

    The S&P is up 196% since Greenspan uttered these now-famous words.
  5. Insights

    Translating "Fed Speak" Into Plain English

    Confused by the Fed's lingo? Find out what it can tell you and learn how to decipher it.
  6. Insights

    Top 4 Things To Know About The Last Double-Dip Recession

    The financial media and investors are haunted with the prospect of a double-dip recession. We look to the past to see if a double-dip recession is in our future.
  7. Investing

    When The Federal Reserve Intervenes (And Why)

    The Federal Reserve doesn't interfere with the economy every time it flounders. Find out more here.
  8. Managing Wealth

    Top 6 Recession Investing Myths

    Find out the truth about recessions and how they impact your portfolio.
  9. Insights

    Does the Fed Influence Who’s in the White House?

    Whether it's intentional or not, the Federal Reserve plays a major role in politics.
  10. Insights

    Recession: What Does It Mean To Investors?

    Understanding the business cycle and your own investment style can help you cope with economic downturns.
RELATED FAQS
  1. What causes a recession?

    A recession is a significant decline in economic activity lasting more than a few months, normally visible in real GDP, income ... Read Answer >>
  2. How successful have "dove" Federal Reserve heads been in the past when it comes to ...

    Review a short history of "dovish" leaders of the Federal Reserve, who use U.S. monetary policy to reduce unemployment through ... Read Answer >>
  3. Do interest rates increase during a recession?

    Learn why interest rates do not rise in a recession; in fact, the opposite happens. Identify the factors that reduce interest ... Read Answer >>
  4. What are some examples of expansionary monetary policy?

    Learn about expansionary monetary policy and how central banks use discount rates, reserve ratios and purchases of securities ... Read Answer >>
Trading Center