What is an Economic Recession

What is an economic recession? This occurs when there is a significant decline in the economy which usually lasts for months. This is visible in terms of consumer spending, employment, industrial production, real income and wholesale trade. A technical indicator of this is 2 consecutive quarters of negative growth which is measured by the country’s GDP or gross domestic product.

Experts say that an economic recession is normal because it is part of the business cycle and things usually improve within 16 to 18 months.

During the business cycle, there is a period of recovery, expansion, slowdown and then recession. During recovery, the GDP of a country starts to move up. When the GDP grows robustly, this is the time that it expands. When consumers are not buying that much, this is when you have a slowdown. Because there is weaker demand, you have a recession.

The last economic recession occurred in 2000 and 2001 which featured three quarters of negative growth followed by three positive quarters then five more quarters of sub par growth. Experts say that the same trend will happen right now.

One solution that the government usually does is lower interest rates to help stimulate the economy. Just last year, the Federal government slashed interest rates three times towards the end of the third and fourth quarter year so that overnight loans between banks could be borrowed at 4.25% which happens to be its lowest in the past 2 years.

What makes the economic recession different from what occurred after the Second World War is that this one is caused by falling home values and a crisis of confidence among fixed income investors.

Despite the fact that the country has endured this time and again for over 50 years, there is still no way to predict when it will happen.

Some use the stock market as an indicator. Others use the inverted yield curve which uses yields on a 10 year and three month Treasury securities and the Fed’s overnight fund’s rate. The unemployment rate is also another which happens to be one of the things that make up the index of leading indicators.

There are people in the Bush administration who do want to call it an economic recession because this will make people panic but there are others who are brave enough to admit that it is here. Since it is going to be some time before the economy recovers again, everyone is advised to stay calm, save up and look for long term investments worth going into.

Apart from the war in Iraq, the economy is going to be one of the critical issues that both candidates have to address as they are campaigning for the highest post in the land. Whoever wins, they have to find a way to reduce the unemployment rate, help people save their homes and a lot of other things that affect the average American household.

An economic recession lasts months at a time. If it should continue for a much longer period, then this is called a depression which is something that the world and not only the US experienced at the end of the First World War. This lasted for up to 4 years that many hope will never happen again.

Please visit each of our Resource Blogs including WII Allaince is a Global Business Alliance sites of WIA & WII.

Click HERE to visit WII ALLIANCE OF WII at


tri wheel scooter
tri wheel scooter - By tri wheel scooter - Homepage
28th March 2012 - 4:39pm

pro kick scooter
pro kick scooter - By pro kick scooter - Homepage
30th March 2012 - 6:11pm

Chaussures de tennis Nike - Comparer tous les prix avecsac a main fourrure sac marques soldes sac a main multipoches sac gucci nouvelle collection
nike air max bw marseille - By nike shox noir argent - Homepage
31st March 2012 - 8:19am

patio wicker furniture
patio wicker furniture - By patio wicker furniture - Homepage
7th April 2012 - 1:03pm

personnalisation tee shirt,tee shirt bob l eponge,personnaliserLe sweat-shirt a capuche Trefoil classique de la collection adicolor allie confort et style
tn requin foot locker - By air max schoenen - Homepage
3rd May 2012 - 7:34am

air jordan high,air jordan jeux videoNouvelle Collection 2010 Air Max 90 premium hommes chaussures prix remise
air max 1990 - By air max one 1987 - Homepage
27th May 2012 - 8:16am

6 Motives Kick Scooters Are generally Great Selections for Overweight Adolescents
kids ride on toys - By kids ride on toys - Homepage
18th July 2012 - 8:06pm

6 Explanations Kick Scooters Are generally Great Ways for Overweight Young adults
snake board - By snake board - Homepage
26th July 2012 - 12:40am

5 Online games for Children's Scooters
flying banner - By flying banner - Homepage
26th July 2012 - 1:54am

ralph lauren, the soul of the design of fully integrated into American high society life in the big-name designers, he has far more than a brand, but an era.Fashion trends changing in a swinging fashion, RalphLauren always insist on its own neat refreshing.
By Visitor - Homepage
3rd August 2012 - 8:35am

rqwyno,617456,oakley discount sunglasses at
oakley discount sunglasses - By dhtclf - Homepage
25th September 2012 - 12:53pm

iqvhre,413390,cheap ugg boots at
cheap ugg boots - By yfnhhv - Homepage
11th November 2012 - 1:53pm coach outlet cheap coach purses coach bags outlet coach outlet louis vuitton outlet coach factory outlet online coach factory outlet louis vuitton bags coach outlet online Louis Vuitton Handbags Outlet Coach Factory Outlet coach handbags outlet - By - Homepage
19th February 2013 - 1:40am

This web site is really a walk-through for all of the info you wanted about this and didn’t know who to ask. Glimpse here, and you’ll definitely discover it….
By cheap coach handbags - Homepage
27th February 2013 - 5:37am

I almost accidentally visited to this site, but stayed here for a long time. Stayed because everything was very interesting. Surely will share with all my friends.
Clarisonic Mia - By Clarisonic Mia - Homepage
14th March 2013 - 6:34am

Very interesting, I talk about it and my sister one day, now I will have a special multiple parameters in my hand, it will appear in a fight.Let us enjoy this blog brings us joy!
gucci outlet online - By gucci outlet online - Homepage
14th March 2013 - 6:39am

Website URL:
Title / Subject:
Hide my email


My Articles

Teaching Your Kids To Save During Recession
Young And Jobless: The Effects Of Economic Recession On The Youth
Economic Recession And How To Deal With It
How Can Your Business Survive An Economic Recession
Economic Recession And What It Can Do To You
How To Save In Times Of Economic Recession
How To Survive The Economic Recession
What Is An Economic Recession
Far-Reaching Economic Recession
Economic Recession: What You Should Do To Prevail
Road Sign Ahead: Signs Of Economic Recession
On The Dole: The Effects Of Economic Recession On Employment
Economic Recessions Are Normal
How To Survive In An Economic Recession
Collateral Damage: Suicide And Economic Recession
Redundant Women: The Effects Of Economic Recession On Women
Behind The Hitch: The Causes Of Economic Recession
How Can You Survive During An Economic Recession
What Economic Recession Is All About
Economic Recession, Tips To Deal With It
Economic Recession: A Wake Up Call
Defining An Economic Recession
The History Of The American Economic Recession
What To Watch Out For During Economic Recession


My Articles

Economic Recession, Tips To Deal With It Economic recession may be a normal part of the economic cycle but this does..

Road Sign Ahead: Signs Of Economic Recession An economic recession is defined by a negative growth in..

How Can Your Business Survive An Economic Recession Your business will surely be affected during an economic recession...

Economic Recession: What You Should Do To Prevail Economic recession, when you consult the books, is actually pretty..

Related Videos:

Related News:

No item elements found in rss feed.