The concept of recession. Recessions in the economy are a decline in industrial production and the threshold of an economic crisis. Explanation of the term and the specifics of its use

The economy of any country develops unevenly and has a cyclical nature. It can experience various fluctuations in business activity, the so-called phases of the economic cycle. The main phases of the economic cycle include growth (rise, peak), stagnation (stagnation), recession (recession) and crisis (depression). A period of economic recession, covering either the entire economy or its individual sectors, is called a recession. What is a recession in the economy, what are the signs and causes of its occurrence, will be described in detail and in simple words in this article.

The meaning of the word "recession" comes from the Latin "recessus" - retreat, slowdown.

In economics, this term means a moderate decline in production or a non-critical slowdown in the growth of the country's economy. This process arises as a result of the violation of economic equilibrium, when production growth is accompanied by a decline.

During a recession, there is a decrease in business activity. In simple terms, consumers begin to cut their costs, and entrepreneurs reduce the amount of products produced.

A recession is a slow and long process that can last from six months to several years.. But unlike a period of stagnation, in which there is a complete and prolonged stagnation of the economy, as well as high inflation, during a recession, the economy does not stand still, there is only a slowdown in its development. In addition, a recession can be managed, and with the right measures, it has the least impact on the economy of the state.

The main sign of the beginning of a recession is a decline in GDP levels. In addition, the beginning of an economic downturn can be recognized by several more characteristic features:

1. Rising prices for goods and products.
2. The volume of production decreases, which in turn leads to a reduction in jobs, and then to unemployment.
3. The income of the population is decreasing.
4. There is an increase in inflation, in some cases - deflation.
5. Stock indices are falling.
6. The number and size of loans issued are decreasing.
7. The number of money transfers to foreign countries is increasing.
8. The external debt of the country is increasing.

The main causes of occurrence

Both erroneous and incorrect economic activities of the state, and global trends can influence the occurrence of a recession. An economic recession can be triggered by:

• high inflation;
• devaluation;
• scientific and technological progress and the introduction of new technologies;
• falling prices for natural resources (gas, oil, gold, etc.);
• reduced demand for imports and exports;
• reduction in incomes of the population;
• monopoly and high taxes;
• outflow of capital abroad;
• a decrease in the volume of foreign investment;
• international sanctions and force majeure (wars, revolutions, strikes).

A recession may also arise as a result of a crisis in the banking sector. A large number of loans issued by banks leads to the fact that borrowers at some point lose the opportunity to repay them. This leads to the bankruptcy of small banks and an increase in interest rates and tightening requirements for borrowers by large banks. This situation reduces consumer demand and slows down the development of production and trade.

Varieties

There are three types of recession:

1. Unplanned. Appears as a result of unforeseen events or changes in market conditions (wars, lower prices for natural resources). This type is very dangerous for the economy, since it cannot be predicted.
2. Exchange or debt. It arises due to the rapid growth of the external debt of the state and a sharp drop in the value of securities. This variety is also very dangerous, so it can drag on for many years.
3. Political or psychological. The decline comes amid growing distrust on the part of investors, businesses and consumers. This is the least dangerous type of recession, since it can be regulated and, with a competent government policy, it can be easily eliminated.

Classification of recessions depending on fluctuations in the level of GDP

Effects

Recession is an inevitable stage in the economy of any country. This process has a number of negative consequences, but the most serious consequence of a recession can be a crisis. The decline in production will lead to a reduction in jobs, and due to the lack of money and work, the ability of the population to purchase goods and services will decrease. As a result, the demand for manufactured products will decrease. Individuals and legal entities will not be able to fulfill their obligations under loans, and their debt to banks will grow.

Banks will begin to tighten lending conditions, reduce the size and total volume of loans. This will lead to a decrease in investment in the scientific and industrial sectors. The decline in investment activity will provoke a collapse in the securities market. This will be followed by inflation, rising prices and dissatisfaction of the population due to the decline in living standards. To correct the economic situation, the government will start borrowing money from other countries. As a result, all these problems will lead to the main harbinger of a recession - a fall in GDP.

If the government does not act or takes the wrong measures to address the recession, this can lead to a crisis and depression. An example is the Great Depression in the United States, during which nearly 13 million people were affected by unemployment.

Out of hopelessness and lack of money, many former office workers agreed to any job in order to somehow earn money for food. Some people deliberately committed minor violations in order to end up in prison, where they would be fed for free.

The most recent recession in Russia was in 2014. In 2015, it accelerated, and an economic crisis hit Russia, caused by a sharp drop in world oil prices and sanctions. This led to the devaluation of the ruble and a decrease in the solvency of the population. Only in 2017 did oil prices begin to rise and the situation on the Russian market improved. A revival phase began: there was an increase in production and the opening of new enterprises.

Fighting methods

It is impossible to prevent a recession, but the state can take measures to mitigate the negative consequences of this process, both for producers and ordinary citizens. To prevent a crisis and fight recessions, the state must take a whole range of measures, namely:

• Stabilize the exchange rate of the national currency;
• Increase the minimum wage, the amount of benefits and the income of the population as a whole;
• Create new jobs and reduce unemployment;
• Provide material support for socially unprotected segments of the population;
• Protect the industrial sector by reducing the tax burden and securing government orders;
• Create programs to support entrepreneurs.

During a recession, you should not take out loans and spend all the money you have, thinking that they will depreciate. You can simply take additional steps to improve your financial condition, such as looking for alternative ways to earn money or investing in education or training.

Recession in Latin, Recessus means retreat. The phase of the economic cycle that occurs during the rise and is the precursor to depression and the crisis of the economy is called a recession. Recession, as a phenomenon, slows down the rate of state economic growth, and its manifestations are observed in a moderate decline in production or negative and zero dynamics of GDP growth.

The concept of recession in the economy and macroeconomics is interpreted as a moderate decline in production, which is not critical for reducing the growth rate of the economy. With a fall in production growth over the course of six months, the size of GDP stands at zero or drops to a negative value.

Dear reader! Our articles talk about typical ways to resolve legal issues, but each case is unique.

If you want to know how to solve exactly your problem - contact the online consultant form on the right or call by phone.

It's fast and free!

Predicting a recession is almost impossible, but with the right government measures, it can be curtailed. The development of a recession can become a source of a serious economic crisis.

The business cycle is a regular change in the level of production, including employment and profits. The duration of one business cycle ranges from 2 to 10 years. The economic cycle is a single process that consistently passes through the periods of the functioning of the economy, they differ in direction and level of activity.

There are such phases of the economic cycle:

Crisis, aka recession

Subsequently, an economic imbalance occurs. A crisis occurs after a recession - production growth is accompanied by a recession. The crisis occurs after a decrease or decrease in the volume of manufactured products; in especially difficult situations, the reduction in work entails the destruction of productive forces.

In a market economy, a production crisis most often occurs; it negatively affects the sale of goods, falling prices and production volumes. Decrease in the volume of production following the balance of unsold inventories, reduction in production, falling demand for labor, decrease in profits, reduced creditworthiness and slowdown in the growth of prices for manufactured goods and services are recession factors.

The production crisis due to the insolvency of the enterprise leads to bankruptcy.

Depression

Following the crisis. During a depression, there is a gradual sale of excess products, sales of products resume and production volumes increase. The economy is in a stagnant state, the decline in GDP stops.

The resulting free capital is integrated into banks, which expands the possibilities for providing loans. Gradual economic growth during the depression stage precedes the economic recovery. At this phase, the main task for organizations is to increase profits; during the crisis, there was a reduction in costs.

revival

It is the last level of economic recession. In the recovery phase, there is a gradual expansion of reproduction and a return to the level of the pre-crisis state.

Rise or expansion is accompanied by active development of the economy. Expansion implies an excess of production volumes that were before the crisis. The rise is accompanied by an increase in the price level, a decrease in unemployment, an increase in loan capital and the attraction of investments.

The main phase of the economic cycle is the crisis (recession). The crisis accompanies the end of one period of development and precedes the emergence of a new cycle, thus, cyclicality arises. During a crisis, the entire ingrained scheme of reproduction is destroyed and a new, more developed system is created. The mechanism of falling prices during a recession leads to a fall in stock prices, interest rates, a decrease in profits, and bankruptcy.

The crisis excludes the overaccumulation of capital by means of depreciation of funds, which stimulates the renewal of production and the improvement of technologies.

Causes and types

An economic crisis can arise subsequently for a variety of reasons, some of which are such factors:

1. A recession may result from unplanned global changes in market conditions. Events that affect changes in the world economy can be wars, natural disasters and sharp fluctuations in the cost of natural resources (gold, oil, coal, etc.).
2. A sharp drop in sectoral industrial production leads to a recession.
3. A recession can arise from a decrease in the purchasing power of the population. A decrease in income leads to a decrease in sales volumes, as a result of which production volumes decrease.
4. A recession can be caused by the fall of the national economy. Most of the state capital is made up of investments made by private entrepreneurs. Accordingly, a decrease in the level of investment leads to a state crisis.

Depending on the causes of occurrence, three types of recession are distinguished:

1. Influenced by changes in market conditions- with very sharp changes in world economic conditions, the prerequisites for which are wars and a decrease in the price policy for natural resources, there is a risk of a recession. Such conditions are very dangerous, since they are not typical and cannot be analyzed and predicted.
2. Political and social aspects, as the cause of a recession, are less dangerous for the economy, since they are amenable to regulation and elimination. Such reasons include a decrease in consumer confidence, a reduction in investment and a decrease in business activity.
3. Loss of economic balance, during which debt obligations increase and there is a rapid drop in quotations on the markets also leads to a crisis.

Effects

The main consequences of a recession in the economy include:

• decline in production volumes;
• the collapse of financial markets;
• decrease in creditworthiness;
• increase in unemployment;
• reduction in the income level of the population;
• falling GDP;

The most critical consequence of a recession is an economic crisis. A manufacturing downturn means job cuts. Lack of money and unemployment leads to a decrease in demand for manufactured products. Unsold goods generate unnecessary costs for the maintenance of stocks.

An enterprise with the formation of a surplus of production reduces production volumes. Citizens have debts on loans, as a result of which the policy of lending to legal entities and individuals is being tightened, and investment in the research industry is being reduced. There is a collapse of the securities market - shares are much cheaper.

This is followed by inflation and a decrease in the purchasing power of the population. The state, trying to deal with the situation, increases external debt by taking loans. In general, the nationwide level of reproduction and GDP are declining.

Economic stability is achieved only after many years of work; the main criterion for avoiding a crisis is the forecasting and regulation of recessions.

Historical example

History knows several examples of recessions that covered entire groups of countries in the world. Thus, in the 1990s, the global financial crisis affected the economies of the countries of the European Union, Latin America, Southeast Asia, and Russia. A good example of a financial and economic recession that has affected almost the entire world economy is the global crisis that began in 2008.

In 2006, the US mortgage system collapsed. Over time, the crisis swept the banking and financial system of the state. By early 2008, the crisis had acquired a worldwide character. The impact of the crisis was reflected in a decrease in the scale of production, a decrease in the level of GDP, and an increase in unemployment. Some countries, including Russia, have reduced the level of lending to a minimum. In Russia, the global crisis led to the bankruptcy of many banking organizations, large firms and a decrease in the living standards of the population.

The global financial crisis has affected the economies of developed and developing countries. World practice has shown that the most important task of any state is to ensure financial stability and prevent recession.

Recession is, definition

recession is a decline in productivity that characterizes a zero or negative basic indicator of GDP - gross domestic product lasting for six months or more.

This is a relatively moderate, non-critical decline in business activity, production, slowdown in economic growth, usually defined as a consistent decrease in real gross national product.

- this is in economics, this term denotes a slowdown or fall in the growth rate of gross output.

recession is one of the phases of the economic cycle that always follows a period of economic growth, accompanied by the achievement of a peak point in business activity, and precedes the phase of an economic crisis and depression.

recession is reduction GDP for two or more quarters, that is, roughly speaking, the situation when all the factories began to produce less goods than before, the shops sell less, and consumers buy less.

recession is a significant reduction in business activity, which may be accompanied by a number of negative factors for the economy.

recession is transition period between boom and depression, and if we rely on the classical definition of recession, then this is zero economic growth (zero GDP growth) for six months.

Recession (from Latin recessus - retreat) is such period in the economy, when the main indicators (especially GDP - ed.) have been falling for two quarters, but this decline is not critical.

Recession concept

The concept of recession is intended to accompany the logical wave of recession on the graph of the economic growth of the territory.

A recession is one of the phases of the economic cycle (), following the boom and followed by a depression.

A recession most often leads to massive falls in stock indices. As a rule, the economy of one country depends on the economy of other countries, so an economic downturn in one country or another can lead to a downturn in the economies of other countries and even to the collapse of world stock exchanges. Recessions also have many other features of cyclical crises, such as rising unemployment.

A recession can occur under the influence of the transformation of the economy of industrialized countries at a new stage of scientific, technological and socio-economic progress, or in connection with an increase in prices for, in particular.

“This is a failure of the existing financial system, the result of a poor quality of regulation, due to which huge risks were not properly taken into account. These are colossal imbalances that have accumulated in recent years. First of all, between the scale of financial transactions and the fundamental cost assets, between the increased demand for credit resources and the sources of its provision. The system of global economic growth itself has given a serious failure, in which one center prints and consumes goods practically without restrictions and without control, while the other produces inexpensive goods. products and saves issued by other states money. Let me add that in such a system, entire regions of the world, including partly even prosperous Europe, found themselves on the periphery of global economic processes, and therefore beyond the scope of making key economic and financial decisions. In addition, the generated wealth was distributed very unevenly both within countries, between population strata, and this applies even to highly developed states, and between different countries and regions of the world. For a significant part of humanity, comfortable housing, education, and quality medicine are still inaccessible. And the global upsurge of recent years has not radically changed this situation. Finally, this one is also the product of inflated expectations. The appetites of corporations were unreasonably inflated in relation to the ever-growing demand. The race of stock indices and capitalization obviously began to dominate the increase in productivity and the real efficiency of companies. Unfortunately, high expectations existed not only in the business environment. They set the rapid growth of personal consumption standards, primarily in developed countries. countries. Growth, which - and this must be frankly admitted - was not backed by real opportunities. It was not well-earned well-being, but well-being on loan, at the expense of future generations. This whole "pyramid of expectations" was bound to collapse sooner or later, which, in fact, is happening before our eyes." V. Putin, from a speech in Davos, January 2009

Recession is

About the terms "recession", "economic collapse", "depression" and " financial crisis»

A successful interpretation of terms that are similar in essence was given by the famous economist of the middle of the 20th century, Murray Rothbard:

In the old days, we suffered from periodic economic crises, the sudden onset of which was called "panic", and the protracted after the panic was called "depression". The most famous depression of modern times is, of course, the one that began in 1929 with a typical financial panic and continued until the outbreak of World War II.

Src="/pictures/investments/img1980620_Velikaya_depressiya_SSHA_1929-1933_godov.jpg" style="width: 800px; height: 674px;" title="(!LANG:US Great Depression 1929-1933">!}

After the catastrophe of 1929, economists and politicians decided that this should never happen again. To successfully and without much trouble to cope with this task, it took only the elimination of the word "depression" from use. From that moment on, America no longer had to experience depressions. For when another severe depression came in 1937-1938, economists simply refused to use this terrible name and introduced a new, more euphonious concept - recession.

Since then, we have experienced many recessions, but not a single depression. However, pretty soon the word "recession" also turned out to be rather harsh for the refined sensibilities of the American public. Apparently, the last recession we had was in 1957-1958. Since that time, we have had "downs", or even better "slowdowns" or even "deviations".

US economic recession

The head of the Federal Reserve System (Ben S. Bernanke) said that in 2008 there will be no recession. At the same time, he says, risk economic downturn persists, in connection with which the country's authorities will consider measures to prevent it. Immediately after the April meeting Fed noted that the rate of decline in the economy has slowed down, although it continues. But then they did not dare to tell the whole truth.

In turn, economists at the American investment bank Merrill Lynch note that such indicators as the worsening situation with unemployment, which reached a level of 5% in the United States in December 2007, as well as decline sales volumes of retail chains clearly point to the beginning of a recession. It turned out that the fall USA will be deeper, and the rise in unemployment may be stronger. The deterioration of the forecast is a sad fact for the entire world community, since it is the economy of the United States of America that is considered the locomotive that will drag crisis all other countries.

largest in USA the investment bank also expects a recession in the US economy in 2008.

The impact of the recession on large organizations

It is important to understand that a recession affects some groups of businesses in different ways, and can affect others in a completely different way. Naturally, all types of businesses, from small businesses to JSCs, will feel the negative effect, but only firms the recession will simply erase, while others will be touched only slightly.

So let's consider a scenario with an imaginary organization K, which is a large industrial structure, and which is trying to do business and carry profit during a recession.

All processes, of course, are much more profitable than described in the article. Everything is confusing and very complicated; this article displays all the negative effects of the recession only schematically.

When a recession begins, the company's volumes fall sales.

The management of the organization will try to find ways to return the former profit. They will start to stop hiring new workers, or hiring may simply go down.

To reduce costs, the organization will spend less on advertising, research and the purchase of new equipment. It may also stop the production of new products that do not yet bring the desired profit. All these actions, in turn, will affect the partners of company K, such as advertising firms, equipment manufacturers, and the like, as they will decrease.

How the recession affects dividends and stocks

When the time comes to publish the financial report, it will show that the organization's profits are falling. Such news will immediately affect the price of the company's shares, profits will immediately begin to fall. As a result of a decrease in profit, it may reduce the payment of dividends, or stop paying them altogether.

The board of directors and shareholders of the organization may appoint a new executive team (ie directors). It is also likely that the advertising department will be reorganized to accommodate the new economic situation.

An important aspect of a falling stock price is that institutional investors will sell firm K's stock when they see it fall in value. They will simply choose a more promising organization and transfer money into her. But you have to understand that institutional investors (banks, Mrs. institutions) operate large blocks of shares, and so selling their blocks of shares to Company K would push the share even lower.

non-payment, debt, .

Accounts receivable is a very important item on a firm's balance sheet that describes the overall debt from clients, partners, etc. During a recession, accounts receivable will increase as debtors of the organization will pay their loans delayed, incomplete, or not paid at all.

Growing accounts receivable, in turn, will affect the company's ability to repay its debts to creditors. As a result, the attractiveness of the organization in the loan market will fall, i.e. its bonds will become unattractive and risky, and large creditors (banks) will not lend to the company due to lack of confidence in the payment of debts.

But not only can a small business cease to be profitable for its owners, it can also affect the well-being of the society or area in which the profit operates. Grocery stores and households. Goods, beauty salons, dentistry, household services (ateliers, workshops, etc.) - all these small enterprises provide residential areas with necessary goods and services. If they disappear, the residents of the area will have a hard time.

It should also be noted that the spirit of entrepreneurs, which motivated young professionals to take various actions to start and develop a business, will begin to disappear. When potential startups see that business is a risky venture during a recession, they will shun, which in turn will lead to uncreated amenities for the area, unrealized jobs, not received money, etc., which contributes to the development and aggravation of the recession.

After the recession, there will be development.

A recession is temporary. After each recession, a new stage of economic development follows, i.e. development. This is the stage at which the most intelligent, arrogant, and enterprising become millionaires.

The recession has a negative impact on all types of businesses. Despite the fact that there are a number of methods to combat a recession, it will still reflect badly on both large companies and small businesses. But it is important to remember that after a recession there is a development stage during which you can work hard and become rich.

Recession in the Russian Federation

Ministry of Economic Development of the Russian Federation To the Ministry of Economic Development announced the start of a recession in Russia. By data Mayor, there's a big downturn industrial production index and the economy, and GDP growth at the end of the year will be lower than the planned 6.8%.

Deputy head of the Ministry of Economic Development of the Russian Federation Andrey Klepach announced the beginning of a recession in the country. According to him, there will be a serious drop in the fourth quarter industrial production and the economy as a whole. “A big decline began in October and will continue in November-December,” Klepach said, noting that there is no data on the November industrial production index yet.

And according to the results of the current year, GDP growth will be lower than the expected 6.8%, and industrial production will grow by only 1.9% instead of the previously forecasted 4.7%. “The figures are being specified now, but it will be somewhere around (1.9%) due to a very large decline in production in November-December,” the deputy minister confirmed.

Forecasts ministries for GDP growth and industry, as well as inflation next year, Klepach refused to voice it, noting only that the calculations are still being refined.

Ministry of Economic Development of Russia Russian Federation of Russia at the end of November reduced forecast GDP growth in 2008 to 6.8-7% percent. According to MED statistics, growth in the first ten months of this year amounted to 7.5%, but in October the spread of crisis phenomena to the real sector of the economy became noticeable, the ministry document said.

The main source of the growth slowdown was the fall in the metallurgical and chemical industries, the production of electrical equipment, electronic and optical equipment, the production of building materials and a number of others.

According to the forecasts of the Ministry of Economic Development of the Russian Federation of the Russian Federation, inflation in the Russian Federation according to the results of 2008, it may exceed 13%.

A recession is a negative trend in macroeconomics (national economy), often preceding a crisis. This phenomenon is cyclical and is inevitable for any economic system.

What is a recession in the economy

Recession (Latin recessus - retreat) is a concept in macroeconomics, denoting a drop in production rates over a long period (from six months or more).

The process is characterized by zero or negative dynamics of GDP (gross domestic product). A recession entails a decrease in business activity, a slowdown in economic development. The contraction of GDP is understood as a decrease in the volume of production of goods and a decrease in the volume of consumption.

A recession inevitably follows an upturn (a boom in production), which is explained by the cyclical nature of any economic system.

In general the economic cycle consists of four phases- growth (rise), (stabilization, lack of any dynamics), recession (fall) and crisis (depression).

The duration of the economic cycle in the modern global world is 10-15 years, which can be tracked by the global financial crises of the 70s, 90s and the last global crisis of 2008-2009.

Causes of a recession in the economy

There are several main causes of recession, depending on the level of development of the economy.

For resource-based economies, the decline in prices for oil, gas and other exported minerals is the reason for the decline. The price of raw materials falls, the budget receives less revenue, there is a deficit that needs to be compensated somehow.

To compensate, tax rates are raised, spending on social needs (education, medicine, etc.) is reduced. Such actions further exacerbate the decline in production.

In developed (industrial and post-industrial) states, a recession manifests itself as a result of a change in the technological structure, for example, due to the emergence and development of information technologies.

The technological order is understood as the level of development of technology and technology, the main directions of development of scientific and technological progress.

It is impossible to influence the indicated reasons for the occurrence of a recession, they arise due to the objective laws of the economy, therefore, a recession at the level of a single national economy will occur sooner or later.

A recession in one state can lead to a recession in other economies, which will lead to a global crisis.

There are reasons that arise under the influence of market participants. The recession in the economy may be caused by problems in the banking sector.

For example, commercial banks have issued too many loans that are not repaid. Then financial institutions are forced to raise rates, raise funds in the foreign and domestic markets. In a situation where there are too many such banks, the number of loans issued falls, therefore, enterprises cannot borrow money and, in the absence of funds, stabilize or curtail production.

Because of this, unemployment is growing, the population and companies do not repay loans, banks are tightening rules, the situation is entering a vicious circle and getting worse.

Force majeure circumstances, such as a war or a sharp change in energy prices, can plunge the economy into a recession phase. The way out of stagnation is possible only with the participation of the state, which will “inject” money into the economy, supporting various industries and stabilizing the national currency.

The consequences of the recession

The main consequences of a recession in the economy include the following:

• decline in production volumes;
• collapse of financial markets;
• decrease in the volume of loans issued;
• growth in interest rates on loans;
• rising unemployment;
• decrease in real incomes of the population;
• falling GDP.

The most powerful and the critical consequence of a recession is an economic crisis. Due to the decline in production, the need for jobs and the number of workers is decreasing. This entails a wave of layoffs and rising unemployment. People begin to consume less, which leads to a decrease in demand for products and an increase in the decline in production.

The debt of citizens and organizations to banks is increasing, which, in turn, are tightening the procedure for issuing loans. The volume of lending to individuals and legal entities is decreasing, the volume of investments in industry and science is decreasing, and scientific and technological development is slowing down. The decline in production is followed by a collapse of the securities market - the shares of large industrial enterprises are losing sharply in price.

These events are followed by the depreciation of money - inflation, further price increases and a decrease in real incomes of the population. Which ultimately leads to dissatisfaction and a decrease in the quality of life.

The state is trying to find funds and increases the external debt. In the absence of a sufficient amount of finance, current loans have to be refinanced and new ones taken.

All of these consequences are reflected in one indicator - the decline in GDP (gross domestic product), which directly depends on the volume of production within the country.

Discussion (10 )

It should be noted that the recession, although an inevitable process, but certain factors can contribute to it. What can be called today is the negative economic situation around the world, and sanctions can only raise production figures.

The sustainability of the country's development is characterized by the successful development of fundamental and applied sciences, the ability to manage effectively (professionally), owning the processes of creating and introducing technologies into production. Professional work to improve the quality of human life, the prestige of the state. Suggest, friend, who among us possesses such a capacity?
Hint: less emphasis on the boblo ... . Creativity is the most effective means of getting results!

A recession is a rabble of charlatans in power. These are not economists, here there is a conspiracy of officials and who are tasked with destroying Russia. And also to create such conditions under which Russia should remain in bondage to foreign banks. Let me give you an example: I have not been allowed to set up a single manufacturing facility for the last 29 years. And now the population of my city is almost all unemployed, living on the pensions of the elderly. In 10-15 years, Russia's external debt will amount to several tens of trillions of dollars. The Government and the State Duma are occupied with one issue: how to increase the receipt of funds in the country's budget. An increase in taxes will not give results; on the contrary, it will follow, the closure of production, in the cities, housing and communal services will become unusable; there will be no funds for the restoration of infrastructure. Customs and border services, which are now helping to fill the budget, will be reduced in the future, since there is no currency to buy goods abroad, etc. I consider first of all to create, while there are funds, the Presidential Fund, which would point-wise direct funds for the opening and creation of new production facilities for the production of products, as well as products that would be exported. In no case do not allocate funds to already open productions. There is a saying that they shoot an old horse. Entrepreneurs who would like to create a production must submit a crude project for the opening of production and, together with the Presidential Fund, bring this project to a ready-made full-fledged enterprise. If, in the event of the termination of an individual, he was engaged in entrepreneurial activity, the property that was built at the expense of the Presidential Fund should be transferred or re-profiled into another type of activity. Upon full repayment of the debt to the Presidential Fund, the property becomes the property of the entrepreneur. Entrepreneurs are prohibited from taking loans from other banks secured by property owned by the Presidential Fund. Allow the subjects of the Russian Federation to transfer land from federal to urban use and simplify this procedure. P.s Well, something must still be done, or the whole country will switch to doshirak.

Sergey, alas, all economies, even the most successful ones, have ups and downs. There are many reasons for this. A good economy differs from a bad one by a shallower recession and a shorter duration.

1. Today's crisis in the economy is the work of accountants Selu-Lu Liu from the economic bloc. Accountants who can only distribute the country's budget a priori cannot develop the country's economy, since they do not understand how to develop the economy.
2. If you are engaged in cyclicality in the economy, then it is foolish to expect that after the rise you and your economy will not fall into a hole after the rise, and the higher your rise is, the deeper your fall hole will be.
3. A good economy has no cyclicality and is in almost equilibrium, for this, any economist can see what gives rapid growth to a non-economic sector that affects the economy, or to the industrial sector in order to prevent overproduction. The economist will determine how to do so that there is no sharp growth in this sector, which creates instability in the economy.

A recession is a harbinger of a crisis. In our country, it is currently provoked by the price of energy resources (oil and gas), financial sanctions of partner countries that wanted to avoid the crisis at the expense of individual countries and regions, trade sanctions on the export of imports for our enterprises, financial credit sanctions, accelerated repayment of loans to foreign banks and the inability to obtain new ones, the confusion of the foreign exchange market and a decrease in the circulation of foreign currency, especially the US dollar, the conduct of hostilities and the political pressure of other states. All this increases the country's responsibility for the development of its own production, moving away from the commodity market, import substitution, strengthening the role of its own currency within the country and reducing the influence of foreign currency on its own economy. I think so.

I would also like to read about ways to fight and get out of the recession. Personally, offhand, I can name two ways.
The first is the US policy during the Great Depression (late 20s - mid 30s), namely, an increase in government spending as part of large-scale financing of the construction of large infrastructure facilities (fighting unemployment), regulation of healthcare and education, ensuring a living wage, devaluation dollar. These measures, although not immediately (somewhere in 5 years), returned both the IPI and the unemployment rate to the “pre-depressive” level.
The second method is the policy of, for example, Saudi Arabia and other states of the Persian Gulf, which, having significant reserves available, can afford to neutralize the consequences of the recession in the economy at their expense by pumping funds into the artificial support of consumer demand (subsidies, unsecured salary growth etc.) instead of investing in the real sectors of the economy. By the way, Russia also used this method in 2008. Its drawback is obvious - the recession syndromes are cured without eliminating its root cause, namely, the inconsistency of the economic model with the realities of the surrounding world.

Describing the state of the country's economy, experts began to often use the word "recession", what is it in simple words, how does it differ from stagnation, crisis? Let's try to figure it out.

The Latin word "recessus" is translated as a retreat. It is used to determine the phase of slow development of the economy, which comes after the stage of recovery and precedes the state of crisis or depression. The amount of production and consumption of products are decreasing. The slowdown in economic growth leads to negative or zero dynamics of the gross domestic product.

The process of recession, according to experts, is natural. The economy of any country has a cyclical nature (phases of the economic cycle) and periodically experiences 4 phases following one after another. After a rapid recovery, a period of stagnation sets in, then an economic recession sets in, and in the next stage, a depression.

According to statistics, it takes approximately 10 to 20 years from one phase to another. Often a recession precedes the onset of a crisis, but timely measures contribute to stabilizing the situation.

9 main signs of a slowdown in economic processes:

Signs of a recession do not always reach critical values. The onset of this economic phase may be indicated by an increase in inflation by 3-4%, while the activity of other indicators warns of an impending economic depression.

11 characteristic reasons for the slowdown in economic processes:

1. Falling cost of natural resources.
2. Unexpected changes in economic sectors.
3. Reducing income due to inflation.
4. Reducing the volume of foreign investment.
5. Monopoly and high taxes.
6. Devaluation of savings.
7. Transfer of private capital to banks in other countries.
8. The impact of international sanctions.
9. Introduction of innovative technologies.
10. Problems of the credit and financial sector.
11. Devaluation.

Often, economic problems in one state cause a recession in others and the global economic crisis.

The difference between a recession and other phases of economic development

Stagnation is characterized by complete stagnation of the economy for a long period, high inflation. The quality of life of the population is significantly reduced. And during a recession, the development of the economy slows down, but it does not stand still. Thoughtful measures of government management allow to bypass the next phase - economic depression. Therefore, the main difference between recession and financial stagnation in various periods of decline in gross domestic product and the consequences for the country's economy.

During the period of stagnation, the economy "tramps around" next to zero indicators. During a crisis there is a sharp decline. The stage of economic recession provides an opportunity to take measures for recovery if the exact "diagnosis" is known.

There are three types of recessions:

• unplanned, which occurs due to unpredictable events - military operations, a fall in the cost of natural resources,
• caused by the external debt of the country,
• arising from the growing distrust of investors, businessmen and consumers.

The first two types of recession are considered more dangerous, because there is no time to prepare for them in order to minimize the consequences, shorten the duration of the process, which may result in

Depending on the schedule of changes in the level of gross domestic product, a recession is distinguished:

• V with a sharp drop in GDP, but not reaching depression,
• U, when the volume of GDP, like a swing, either grows or decreases,
• W, when in the middle of the recession process there is a short-term development of GDP,
• L with a rapid decline in GDP, followed by a smooth recovery stage.

How dangerous is the economic downturn?

The most terrible consequence of a recession can be a crisis. The reduction in the production of goods entails a decrease in jobs. The population begins to save on expenses, demand in the market falls. Production volumes continue to fall. The debt of people and business structures to financial institutions begins to increase, tightening the conditions of loans. The size and number of loans are significantly reduced, which leads to a decrease in investment in the scientific and industrial fields. The decline in market activity leads to the depreciation of shares and other securities.

As a result, the national currency of the country is depreciating, prices are rising and the population is dissatisfied with the decline in living standards. To correct the economic situation, the government borrows money from other countries. The result is a reduction in GDP, which is the main harbinger of a recession that can turn into depression and crisis.

Almost all states experienced such a crisis in 2008-2009. In 2014, Chinese GDP grew by 7.4%, America - 4%, Russia - 0.6%, global - 3.2%. In 2015, in addition to Russia, the negative development of the economy was observed in 15 states.

How long will it last and what will be the consequences? According to independent analysts, the current difficulties in Russia will have to be overcome throughout 2016. No one risks predicting an upward movement in the economy or a depression, because many unpredictable factors are involved in the process.

Stagnation and the onset of a crisis can only be prevented with the help of public administration. The implementation of state programs to attract investment, support industrial sectors, and stabilize the exchange rate can have a positive impact on the development of economic processes. A recession can be controlled and predicted. Only inaction and wrong policies lead to a crisis. For example, experts warned about the current American recession almost 2 years ago, so the US government took a number of measures to reduce its negative consequences and the onset of the crisis.

Experts call the reasons for the protracted recession in Russia:

The reason for the upcoming global crisis, according to independent analysts, may be the Chinese economy, which has sharply slowed down growth, the problems of its stock market. The Italian and French economies are going through a period of permanent recessions, periodically reaching a positive zone.

Understanding the essence of the word "recession", what it is in simple words, whether it is necessary to be afraid of it, will allow you to prepare for life during a crisis. The problems with cyclical economic recessions are quite solvable, so you should just take additional measures to improve your well-being. Find sources of additional income using needlework skills, a piece of land or investment.