Financial Recession in Stock Markets

Introduction

What Is Economic Recession

When GDP growth is negative for two consecutive quarters or more. For all practical purposes though, a recession starts when there are several quarters of slowing but still positive growth. The first quarter of negative growth in a recession cycle is often followed by positive growth for several quarters, and then another quarter.of.negative.growth.

This definition is somewhat unpopular with many economists as it does not take into consideration changes in other economic variables such as current unemployment rates.or.consumer.confidence.and.spending.levels.

The official agency in charge of declaring that the economy is in a state of recession is the NATIONAL BUREAU OF ECONOMIC RESEARCH (NBER). NBER'S defines recession as a "significant decline in economic activity lasting more than a few months" For this reason, the official designation of recession may not come until.after.we.have.been.in.one.for.as.ubstantial.amount.of.time.

It is actually quite natural for countries to experience mild economic recessions. This is a built-in factor of a society economic cycle as spending and consumption are going.to.increase.and.decrease.along.with.prices.

Rarely, experiencing many of these factors simultaneously can evoke deep economic recession or depression

Definition of Recession

Recession is not to be confused with depression. Recession means a slow down or slump or temporary collapse of a business activity. In its early stage it can be controlled in a methodical manner. Experience helps to avert total collapse. Unchecked, it leads to severe depression. Depression is a dead end. It is time to close shop completely. It is a total state of irrevocable economic failure. When a country is doing well all round its Gross Domestic Product (GDP) is on the rise.

Overall economy is bullish; it is not only the stock exchanges that tell riches to rags stories but even small businesses. It all adds to the national... [continues]

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