Causes Of Economic Recession And Our Attitude

Business Cycle refers to the relatively long term fluctuations in economic activities

or production side and contraction in Business Cycle or slowing down of economic activities is called Economic (Financial) Recession. A lot of theories can be provided to present the macro causes of Economic Recession. Few of which are collapsing down of property business, hiking up of energy prices, fading of business profits, high interest rates, weakening of job market, drop down in tax revenue and drop-off in business investments by foreign and local investors in many countries. These are all indicators that give bearish trend to the stock market. But many experts around the globe believe that a rigorous economic recession is a result of negative GDP (Gross Domestic Product) growth in many successive periods.

The economic recession cycle is based on several continuous phases of positive and negative GDP growth. Often, it is observed that before a true recession starts a mild cycle of negative growth is followed by a slight positive growth in GDP and then again the same cycle of negative growth starts and so the recession trend elaborates. A lot of people are affected by economic recession and it becomes harder for almost everyone to survive in this tough span. Generally, government or administration is blamed for this state during this time. According to experts, recession is unavoidable to some extent and its causes are not well understood but the administration has some influence in the degree of recession. The government must take some beneficial steps to soften the impacts of recession on common people. Most of the time the steps taken appear to be unsuccessful but still the government should put some effort to make the recession less severe.

We hardly get to know officially that we are into some kind of financial crisis and we seriously need to do something to get out of it. As one expert said, that "Part of the problem is just not knowing, the longer the process of not knowing what the losses are takes, the longer the resolution takes." Working well and working together in one direction can be like a light at the end of a tunnel and all must march towards that end.

by: William

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