🐵 What does a recession really mean?
we all know it’s bad when we hear the word “recession” all the time… 👎
but we just look at our stocks go down and say “yeah… the recession am i right”
yes, well, kinda, but not quite…
📖 the definition:
typically, it’s officially a recession when GDP falls for two consecutive quarters – because this straight up means reduced economic activity, trade, industrial activity, etc.
quick formula: GDP = Consumption + Investment + Gov't Spending + (Exports - Imports)
more strictly though, NBER (National Bureau of Economic Research) are the ones that officially declare a recession and their definition is:
“significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales”
(so a lil’ different but you get the picture…!)
🤷 so how is the US GDP doing?
as you can see above, US GDP for Q1 ‘22 fell at a 1.4% annualized rate, while most analysts expected a +1% gain.
this means that we are one quarter away from an official recession 😰
gotta go back to finishing up Jian Yang’s pitch – have a great Saturday y’all!
this is my second post ever… please bear with me as i try to make this better in content, design, form, etc. this will be a learning experience for myself as well!
thank you for your patience, and always send me your questions or any suggestions you have with Ask a Wise Ape!