Economic Matrix 101
The y-axis represents inflation (high to low), and the x-axis represents GDP growth (high to low). Even with negative growth, we face two bad scenarios: stagflation (high inflation, low growth) and recession/depression (low inflation, low growth). Stagflation and economic booms are typically temporary because they’re unstable states.
Recessions can persist and deepen into depressions, while economic booms can last if central banks fail to manage overheating (e.g., through interest rate hikes). As a Gen-Yer, I barely experienced the last major recession during the Global Financial Crisis (GFC) of 2008–2009. While the pandemic caused a significant downturn, I don’t expect a repeat (barring some mad scientist unleashing chaos). The GFC is likely a better case study for understanding recessions. Unless the current trade war and tariffs escalate into a full-blown recession, I doubt I’ll live through many events like these.
Recessions can persist and deepen into depressions, while economic booms can last if central banks fail to manage overheating (e.g., through interest rate hikes). As a Gen-Yer, I barely experienced the last major recession during the Global Financial Crisis (GFC) of 2008–2009. While the pandemic caused a significant downturn, I don’t expect a repeat (barring some mad scientist unleashing chaos). The GFC is likely a better case study for understanding recessions. Unless the current trade war and tariffs escalate into a full-blown recession, I doubt I’ll live through many events like these.
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