What is a double recession?

The double dive recession describes the period in which the economy moves into the recession, bounces briefly, and then re -immerses it back into the recession. The United States has experienced this type of recession in the early 80s. The double dive recession is sometimes referred to as a W -shaped recession that describes the line of economic trend on the graph showing two distinctive troughs with an increase between them. A short period of growth between two recessive periods is sometimes referred to as "dead cat reflects". In a recession with double immersion, the economy shows negative growth for two or more neighborhoods, positive growth for a quarter or two and then two or more quarters of negative growth. The recession is not considered completely until the economy shows more than two consecutive quarters of growth. While countries tend to go to the recession of independentpathers with each other, if the factors causing recession affect most of the world, a global recession may occur.

The double dive recession may sometimes be caused by the government when taking too aggressive steps to stabilize the economy and support recovery. In the recession in the United States at the beginning of the 80s. President of the Federal Reserve Paul Volker, who feared the economy would suffer from inflation, increased interest rates sharply. While there was a short -term improvement, increased interest rates soon caused the economy to drop again, resulting in a double immersion recession. This second dip led the interest rates back down, resulting in deflation or a reduction in prices.

Another characteristic feature of a double dive is the so -called recovery of unemployment. This is when most indicators, including gross domestic product or GDC, point to economic growth, but the unemployment rate remains high. Job growth is an end indicator of economic growth, which means that it occurs after the improvement of other economic indicators have been improved. Therefore, when other indicators of signalIt does not regenerate, but the expected growth of jobs will not arise, the economy can slip into the recession and create a recession with double immersion.

Double -dive recession is the worst kind, because consumer trust is disturbed when the economy seems to turn, but then decreases again. Consumers fear that the recession will continue and could deteriorate depression. This makes it much more difficult for the economy to based on a double immersion recession.