Business, Finance & Economics

Global recession fears continue

(There's today talk of a global recession. What's a recession and how does a global recession differ from it?) A recession is when you have two consecutive negative quarters of economic growth. Such an event tends to happen every 6-7 years and it's cyclical. Whether this turns into a depression is a big question, and that's only happened in the 1930s. a depression is negative growth quarter after quarter and a loss in wealth that can go on for a matter of years. (The �30s was a global depression?) Yes, and this is what's alarming because it's been so long since there was a global depression. People have found hope in the fact that the emerging markets would continue to grow and they would demand goods from the developed world which would mitigate the extent of the recession. (Isn't the way to prevent a global recession to buy up credit, or is credit just so shot right now?) I think a lot of reporting may have an element of false casualty. Stocks have fallen because they have to, creditors are calling on people to pay off their loans. The financial sector has also been mismanaged and the amount of capital given out for things to grow is going to reduce. (How big a concern are class tensions among investors?) The concern is governments will start doing big populist things. The European Central Bank head also suggested the growth in equality in the U.S. and Europe led to this situation because there was so much mistrust.

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