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The Credit Cruncher was conceived to help you to keep up to date with credit crunch and recession developments, it provides some helpful credit crunch advice and it addresses personal debt. The Credit Cruncher also seeks to explain how the credit crunch started and shed some light on the worldwide recession. Recently, we have begun to look at how BREXIT will affect the UK economy. Please feel free to leave comments where relevant.

5 Sep 2011

Double Dip Recession?

It seems that everybody is now talking us towards a double-dip recession which is probably worth a quick explanation.
Firstly, we need to understand that recession is in place when a national economy records a drop in GDP (Gross Domestic Product) for two consecutive quarters. Historically, this was announced in the UK in January 2009. A year later (Jan 2010), and the UK was officially out of recession and on course to build a slow recovery - however there is a danger that following on the heels of the fledgling recovery is a second period during which the GDP drops sufficiently for the economy to officially enter a second episode of recession before recovery has fully taken root.

At the end of the day, whether recession is announced (again) or not, the delicate balance of the economy of course is the real issue and there is little doubt that we are precariously balanced. What is more difficult to assess is what the long term prospects are.
Certainly, the economy has taken a big hit, equally certain is that the politicians will do their utmost to introduce a quick fix for their own political good, but the continuing existence of the western economies is dependent on some careful steering of the individual nations through difficult waters, and taking some measures that will not be wildly popular with the voters.

Call it double-dip, call it credit crunch or call it a depression - the name is not really important, the only thing that matters is that those with power realise that they need to put aside their personal agendas and concentrate on keeping their national economy solvent.

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