What is a recession in the economy

click fraud protection

In recent years, many people are eager to find out what factors lead to a crisis, and that this recession.This interest did not arise out of nowhere.The development of information technologies and the emergence of the Internet allow interested parties to be constantly aware of the processes occurring in the stock and financial markets.Moreover, they have a real opportunity to engage in various kinds of speculation in the foreign exchange market.In open source, you can find information about the people working in this area have incomes much higher than those involved in the real economy.This is the specificity of the modern world economy.

Asked about what a recession is, it is necessary to make a brief excursion into history.In the first third of the last century in the United States there was an economic crisis.Saleable production at first slowed and then reached zero.Experts call this phenomenon a crisis of overproduction.Among the most advanced analysts were those who calculated the cyclical crisis in the market economy.A renowned scholar, won the Nobel Prize, vying to prove that crises can occur in 3-4 years, 7-11 years, or over, or 15-25.The most popular and marketable population cycle of 45-60 years.It calculated the well-known Soviet economist Nikolai Kondratiev and mathematician.

So, what is a recession?This decline in production.If within six months, the growth of gross domestic product, everyone knows how GDP is zero or negative, then we can safely draw the conclusion that a recession occurred.This phenomenon must always be a period of recovery and is preceded by a period of crisis and depression.It was in this state of the economy of the developed countries after the crisis that began in 2008.In this context, the forecast of economic development of Russia in the next few years looks quite ambiguous.

According to the rules, on which is built the modern economic mechanism, to avoid the crisis in the economy is impossible.With this do not want to accept classical liberal approaches and struggling to use other words to characterize this phenomenon.Instead of crisis and depression are encouraged to use the terms "temporary decline", "slow down" or "rollback".But no matter how expressed, and the meaning of these definitions, embodied in real life, is that they lead to a decline in production, reduction of income, increase in unemployment.Under the current mechanism to date Russian economic outlook does not imply a positive development of the situation.

Concluding the conversation about what a recession is, it should be noted that the decline in production is due to several reasons.The most frustrating reason - this is war or major conflict that may radically change the situation in the world economy.The second reason is of a political or psychological.When people in many countries refuse to buy British beef, it is causing negative consequences for the whole economy.Another reason may serve as excessive obligation of the state to certain categories of citizens.They promised to increase pensions and failed.Here and there was a pre-crisis situation.