We’ll Know We Are in a Recession on July 28
Should you spend or save?
Where were you in 2008 when you realized you were living through a major economic recession? Did you learn anything from that period of your life? How do you feel about the economy right now? In any case, it seems that a recession is upon us.
But how do we know for sure that we are in a recession?
Economists have defined what it means to be in a recession. Generally, an economic recession is when there are two consecutive quarters where gross domestic product (GDP) declines. Last quarter, we had a decline in GDP, so if GDP continues to decline this quarter, then we will know we are in a recession. The Bureau of Economic Analysis (BEA) will soon confirm if GDP has declined for a second consecutive quarter.
The Bureau of Economic Analysis (BEA) is the agency that will confirm and announce that a recession has started. The BEA will give us an estimate of the GDP through an advance estimate. The BEA will release an advance estimate on July 28th for the GDP of the second quarter. If the first two quarters are both negative, then we will know for sure that we are in a recession.
There is a chance that consumers worrying about a recession happening could actually cause a recession. In other words…
