What Is Another Word For Recession?

Credit crunch, credit squeeze, economic downturn, depression, slump, slowdown, trough Stagflation is a term that refers to a state of stagnation.

In basic terms, what is recession?

When the economy becomes less active, it is called a recession. Many corporate shares are depreciating in value. One definition is that a recession begins when the gross domestic product falls for two quarters in a row. Between 2007 and 2009, the Great Recession occurred.

When the economy grows, what is it called?

The economy is in an expansionary phase when it grows for two or more quarters in a row. Consumer confidence improves as interest rates fall, employment rates rise, and consumer confidence rises.

When the economy reaches its maximum productive output, the peak phase occurs, signaling the end of the boom. After this point, employment and home starts begin to fall, signaling the start of a contractionary phase.

A trough is the lowest point in the business cycle, and it is marked by more unemployment, less credit availability, and dropping prices.

What exactly is a technical downturn?

With improvements in manufacturing, construction, and agriculture, the Indian economy has emerged from technical recession, growing at 0.4 percent in the third (October-December) quarter of 2020-21.

• In the April-June and July-September quarters, respectively, the Gross Domestic Product (GDP) dropped by 24.4 percent and 7.3 percent, indicating a technical recession in the aftermath of the Covid-19 outbreak.
• A technical recession occurs when a country’s GDP continues to fall for two quarters in a row.

Key Points

• The National Statistical Office (NSO) has forecasted an 8 percent shrinkage for the entire fiscal year (2020-21), which is higher than the Economic Survey’s (7.7%) and Reserve Bank of India’s (RBI) estimates (7.5 percent ).
• The third quarter’s real GDP growth is expected to be 0.4 percent (2020-21). The GDP expanded by 3.3 percent in the same quarter last year.
• The contraction numbers for the April-June quarter (Q1) and the July-September quarter (Q2) were revised from 23.9 percent to 24.4 percent and 7.5 percent to 7.3 percent, respectively.
• Industry grew by 2.6 percent in the third quarter, compared to a decline in the first two, thanks to stronger performance in manufacturing, power, and construction.
• However, with a 0.9 percent year-on-year decline, services, which account for the greatest share of GDP at 57 percent, remained in contraction territory.
• Financial, real estate, and professional services rose 6.6 percent in the third quarter, compared to 9.5 percent decline in the previous quarter and 5.5 percent growth the year before.
• Mining, trade, hotels, transportation, communication and broadcasting services, and public administration services all continued to contract in the third quarter, with contractions of 5.9%, 7.7%, and 1.5 percent, respectively.
• Even while the other five sectors contracted, India’s eight key sectors saw a meager 0.1 percent increase in output in January 2021, boosted by 5.1 percent growth in power, 2.7 percent growth in fertilizers, and 2.6 percent growth in steel manufacturing.
• In January, coal, crude oil, natural gas, refinery products, and cement all saw declines.
• The Index of Industrial Production is made up of eight key industries, which account for 40.27 percent of the total.
• Agriculture grew by 3.9 percent in October-December, compared to 3 percent in July-September and 3.4 percent in the same quarter previous year.
• The recovery in investment demand (Gross Fixed Capital Formation – GFCF), which climbed by 2.6 percent in the third quarter after several quarters of stagnation.
• GFCF: It stands for gross fixed capital formation. It’s part of the Expenditure Method of GDP Calculation.
• This is the result of the government’s unwavering efforts to resuscitate investments through the Atma Nirbhar Bharat package’s many measures.
• The growth stimulus included in the Union Budget 2021-22, as well as supplementary measures such as the Production-Linked Incentive (PLI), will contribute to a robust recovery path in the next years.
• The comeback of Government Final Consumption Spending (GFCE) in Q3 and the Centre’s capital expenditure climbed by 129 percent in October, 249 percent in November, and 62 percent in December, compared to the same period last year.
• The GFCE is an aggregate transaction amount on a country’s national income accounts that represents government expenditure on goods and services used to directly satisfy individual wants (individual consumption) or collective needs of community members.
• The third-quarter GDP figures confirmed the government’s initial policy of deregulation “Life trumps livelihood.” “As a result of savvy handling of the lockdown and a calibrated fiscal stimulus, the swift V-shaped recovery has been powered by recoveries in both Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF).
• PFCE: It is defined as the expenditure on final consumption of goods and services by resident households and non-profit institutions serving households (NPISH), whether made within or outside the economic region.
• Domestic Consumption: Disaggregated data reveal that domestic consumption continued to shrink in Q3, falling to 58.6 percent of GDP from 60.2 percent in the previous fiscal quarter.
• Government Spending: According to the GFCE, government spending fell a smidgeon to 9.8 percent of GDP in Q3 from 10% in Q2.
• GVA Estimates: The growth rate in terms of gross value added (GVA) which is GDP minus net product taxes and represents supply expansion is expected to slow to 6.5 percent in 2020-21, down from 7.2 percent and 3.9 percent the previous year.
• Gross Domestic Product (GDP) in Nominal Terms: It is predicted to be (-) 3.8 percent in 2020-21 after accounting for inflation.

What’s the difference between a recession and a depression?

A recession is a natural element of the business cycle that occurs when the economy declines for two consecutive quarters. A depression, on the other hand, is a prolonged decline in economic activity that lasts years rather than months.

What do you call it when the economy collapses?

An economic collapse is the breakdown of a country’s, region’s, or territory’s economy, which usually occurs after a period of turmoil. An economic collapse happens when a severe version of an economic contraction, depression, or recession begins, and it can continue anywhere from a few months to several years, depending on the severity of the circumstances. An economic collapse might occur suddenly as a result of an unforeseen incident, or it can be preceded by a series of events or signals indicating economic fragility.

What is a significant downturn?

Although economists and historians disagree about certain 19th-century recessions, the consensus view among economists and historians is that “the cyclical volatility of GDP and unemployment was greater before the Great Depression than it has been since the end of World War II.” Cycles in agricultural production, industrial production, consumption, and business. Recessions in the United States are progressively affecting economies around the world, especially as economies become more intertwined.

The National Bureau of Economic Research (NBER), an American private nonprofit research institution, has determined the unofficial beginning and ending dates of recessions in the United States. A recession, according to the NBER, is “a major drop in economic activity across the economy that lasts more than two quarters, or six months, and is generally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”

Recessions and financial crises were common in the nineteenth century. Due to a lack of economic statistics, determining the occurrence of pre-20th-century recessions is more difficult, thus academics rely on historical reports of economic activity, such as contemporary newspapers or business ledgers. Although the NBER does not provide dates for recessions prior to 1857, economists commonly derive dates from business annals dating back to 1790 based on various contemporary descriptions. Their efforts are supported by historical trends, which show that recessions frequently follow external shocks to the economy, such as wars and weather-related agricultural disruptions, as well as banking crises.

Major modern economic indicators, such as unemployment and GDP, were not collected on a consistent and standardized manner until after WWII. The 11 recessions between 1945 and 2001 lasted an average of ten months, compared to 18 months for recessions between 1919 and 1945 and 22 months for recessions between 1854 and 1919. It’s impossible to compare the severity of modern recessions to early recessions due to the vast changes in the economy over the ages. Before the COVID-19 recession began in March 2020, no postwar era had come close to matching the depths of the Great Depression, which lasted from 1929 to 1941 (with a bull market between 1933 and 1937) and was triggered by the stock market crash of 1929 and other circumstances.