Are we heading towards recession like 2008 wherein people have cut down their spendings and companies are laying off their employees, we can see cost-cutting everywhere, is it really a recession or just the panic about an uncertain future which is creating a gloomy atmosphere everywhere?
Recession is a condition where the economy of a country has decreased significantly for six months. Recession can affect many people because when the economy slows, unemployment rises, consumer purchases decline, businesses go bankrupt.
For some time the world was shocked by the economic conditions of Singapore and Hong Kong that led to a recession then followed by several other countries that entered the recession, including Argentina, Iran, South Africa, Turkey, and Venezuela.
The global economic slowdown caused by trade and Brexit wars is indeed felt by many countries, but it all depends on the real conditions of each country and the government's ability to map problems and find monetary and fiscal policy formulas to escape the recession waves faced by other countries.
Economic recession in a country is affected by
- The state of the United States economy because America is a barometer of the world economy
- Recession does not depend very much on the Trump government's policies on trade and currency war and the policies of the Fed. Trump is the leader of a country that is a barometer of other countries.
- The 10-year cycle of American economic expansion has now been more than 10 years so far there has been no contraction.
- The condition of long-term investment interest in government bonds is lower than the short-term. This means that investment returns will tend to be negative. This shows that there will be pessimism about the long economy, also a sign of future recession.