A highly watched economic indicator with a good track record in predicting recessions cut its forecast for second-quarter gross deomestic product growth this week, implying the nation has fallen into a recession, per Forbes magazine..
The first thing that happens during a recession is the economy slows down. This means that businesses are producing less, and consumer spending is down. At this time consumer spending is down and at the same time their credit card limits are maxed out. Businesses have inventory but the consumer is not buying. This can lead to layoffs, as businesses try to cut costs. We are seeing that at the moment, businesses are starting to lay off, cutting back on hiring. Putting freezes on hiring. During this time, there's a significant decline in the demand for goods and services. We are in a recession because this has been going on for months.
Full Story: FORBES
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