RECESSION: The common term used for the contraction phase of the business cycle. A general period of declining economic activity. During a recession, real gross domestic product declines by 10 percent or so and the unemployment rate rises from it's full employment 5 percent level up to the 6 to 10 percent range. Inflation tends to be low or non-existent during a recession. Recession last anywhere from six to eighteen months, with one year being common.



DEPRESSION: An extended period--a decade or so--of restructuring and institutional change in an economy that's often marked by declining or stagnant growth.


I would welcome a recession but I'm afraid that what we are headed for is a depression. We had one of the longest periods of economic growth in US history over the last decades. However, our dollar has lost 40% of its value against the Euro in 3 years, the baby boomers are about to retire and we have a massive debt on medicare and social security and it is about to spiral out of control. We have China and other countries holding tons of our debt. We have had slow, steady rises in energy costs and unless somebody comes up with some other energy source demand is only going to go up and so will prices. Ladies and Gentlemen I'd say we are on the eve of the next depression.