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Recession What Recession There is no doubt we are living in a time or space which is different in economic terms to what existed a couple of years ago. And the term used is a recession. The commonly held view is once we get over or out of this recession economic activity will once again happen, the indicators will again record positive and the world will carry on as before. In this regard I would like to bend our view of the world in which we exist, live and operate. How we got into this situation and who is to blame will be debated forever as will the steps required to get us out. To apportion blame is to see only one aspect or to see someone's decision as the cause, when the result originates from many causes. And if the steps taken to get us out, place us back at the position before the recession, then we have not learned a lot. Throughout history there has always been the rise and decline of societies and countries. A gain and loss of comparative advantage, the gain arising from the utilisation of the technology and the decline arising from the infrastructure put in place to support the activities arising from the technology. Technology is never the end result, technology is only the instrument. Technology is about using or making the tools. To the ancients, striking a stone with another gave a spark which lead to fire, which is use of technology. The Bronze Age changed societies, the merchant states of the old world; trade was successful because they understood boat building. The middle ages with the printing press and compasses / sextants brought to the fore the county's of Europe. Think of the towns and cities anywhere in the world that once had prominence in pottery, clothing, steel, ship building. Many more examples abound but in all one thing is common, ascendance and decline as other technologies to took their place. The question therefore arises, if their society was in decline why did they not adapt the new, the best answer I can give is the infrastructure they built to support their activities. An infrastructure of people and money to support and undertake the activities takes time to come to fruition but the dismantling takes even longer to dismantle or adjust and in that time others take their place. Such is the way of the world. We are possibly at end of the Industrial Age. The Industrial Age was about production and sales and these are in decline. The infrastructure has not kept pace with the changing world, leading to what is called a recession. A situation faced by many societies in the past, some who survived, others did not. And did they call it a recession in the past or just that another society had comparative advantage. Nowadays we operate in a global environment so all are affected. The good news is we will come out of it, we always have, but there will be casualties, so if you don't want to be a casualty, adapt to the technology of the world that is here and to come And why do they call it a recession, because the metrics used say it is, but what if the standards of comparison used have no merit. Comparison with the known past and an unknown future is not possible. Therefore you don't have a recession, only a changing world for which measurements have not yet been found. And is the response as suggested below the answer The definition(s) of what constitutes a recession as per Wikipedia below. "In a 1975 New York Times article, economic statistician Julius Shiskin suggested several rules of thumb for identifying a recession, one of which was "two down quarters of GDP". In time, the other rules of thumb were forgotten and a recession is now often defined simply as a period when GDP falls (negative real economic growth) for at least two quarters.Some economists prefer a more robust definition of a 1.5% rise in unemployment within 12 months. In the United States the Business Cycle Dating Committee of the National Bureau of Economic Research (NBER) is generally seen as the authority for dating US recessions. The NBER defines an economic recession as: "a significant decline in [the] economic activity spread across the country, lasting more than a few months, normally visible in real GDP growth, real personal income, employment (non-farm payrolls), industrial production, and wholesale-retail sales."Almost universally, academics, economists, policy makers, and businesses defer to the determination by the NBER for the precise dating of a recession's onset and end In economics, a recession is a general slowdown in economic activity over a sustained period of time, or a business cycle contraction] During recessions, many macroeconomic indicators vary in a similar way. Production as measured by Gross Domestic Product (GDP), employment, investment spending, capacity utilization, household incomes and business profits all fall during recessions." "Governments usually respond to recessions by adopting expansionary macroeconomic policies, such as increasing money supply, increasing government spending and decreasing taxation." Footnote: The manipulation of a variable to produce a pre-conceived outcome often leaves the other variables to run their course uninterrupted leading to an outcome not envisaged. As in the expansion of credit is ok as long as inflation is held in check has proved this to be the case Contact Firstsearch

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