Travel Blog

Are We Headed for Another Recession

Headed for Another RecessionApparently 8 out of 10 Americans think we are already in a recession. Are we headed for another recession and is it going to be serious. For a recession to be official, you must have two or more quarters of negative growth in the economy. Canada has already reported that there economy shrank in the 2nd quarter. Indicators are that the 3rd will be no better.

When we originally wrote this post, the indicators seemed to point in that direction. However two years later, the recession has never arrived and the stock market is booming. So much for the financial gurus knowing what they are talking about.

Headed for Another Recession

Whether we are officially in a recession or not according to the economic gurus, it really does not matter. What matters is what people think and how they spend their money. If the general population believe we are in a recession and are worried about more job losses, then they are going to reduce their spending plans and that alone will push us into a recession. Let’s face it if you are working now and worried about losing your job, you are not going to go out and buy that new car, the white goods etc. You are going to reduce spending and save your money in case you get laid off. This can translate quickly into the result that we are headed for another recession!

This is the major problem that the US faces and in fact many countries around the world face. Consumers are simply not spending. They are too worried about having enough money to live on and support their families.

As bad as it is, the recent storms along the east coast are going to create thousands of temporary jobs to help clean up and rebuild. But what we really need are jobs that will last a long time and produce goods that add value to the economy that we can ship to other countries. These are the type of jobs that keep people employed and spending money in our country. So far we have not seen that and in fact the general consensus is that we have lost jobs to other countries and will never see them back.

Maybe We are Not Headed for Another Recession

For us writing this blog every day, this is the really big story of the week. One that all of us better pay attention to over the next few months and years. We hope that the experts are wrong and that there is not a serious recession on its way, but all indicators seem to point in that direction at this time. Maybe it will only be a small reduction and the economies around the world recover from the problems created by the 2008 recession. We can only hope!

The recession is already here and we just have to wait for the experts to report the results of the economy for the 3rd quarter to find out if it is real or not according to the numbers. Eight out of 10 Americans probably have got it right!

For more thoughts about US politics, click here.


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