How To Guide For: A Look At Whether We Are Heading For A Recession & Ways To Prevent It From Hap

A recession is a negative economic growth for two consecutive quarters. It is also a business cycle contraction which results in a general slowdown in economic activity. Macroeconomic indicators such as GDP (gross domestic product), investment spending, capacity utilization, household income, business profits, and inflation fall, while bankruptcies and the unemployment rate rise. Recessions generally occur when there is a widespread drop in spending. This can be caused by events; such as a financial crisis, an external trade shock, an adverse supply shock or the bursting of an economic bubble. Several reports indicate that we are heading towards another recession due to factors such as the growing student debt problems, unemployment rates, the fall of the Chinese economy, and many other factors. So now that we know what a recession is and that we might be headed in that direction how do we prevent this from happening. We can start by keeping cutting interest rates. Lower interest rates reduce mortgage interest payments, giving consumers more disposable income. Lower interest rates also encourages people to spend rather than save. But lower interest rates doesn't always work; take the recession of 2008-2009. Another way to avoid a recession is by cutting taxes which will increase consumer disposable income. These are just some of reasons why we may be heading for a recession and some of the ways to prevent a recession from happening. To get more in depth information on if we are heading for a recession and how to avoid a recession -- click the pictures below to read the articles.