So there we have it - the official statistics point to a second quarter of falling Gross Domestic Product (GDP), which sets the definition of a recession. Personally I always favoured The Economist's definition, which was also a lead indicator, which was the number of times the word recession was used in the press in a defined period. If it hit a certain level, it was recession and the figures to confirm it would appear rather later.
Actually, on the official definition, we haven't seen a recession since the early 1990s - I am not sure where the Economist figures fit with that as I haven't subscribed for many years now.
Anyway, we can expect to see more misery in the news programmes, many more articles on how to survive a recession, how to manage the household budget in a recession, austerity food and drink, and pictures of people being turned out of their homes. The early 1990s recession was grim I recall - I was lucky in that I had a job with a major company that wasn't about to make people redundant, but my husband had a new business start up that failed (albeit we managed to close it while it was solvent). We had bought our first home, but interest rates went mad and property prices fell. We lived in the North East too, where unemployment was already high and opportunities exceptionally rare. My husband applied for one job with a drinks manufacturer that had 600 applicants - how can you chose the best person for the job in those circumstances?
This time round we both have small businesses, we have no mortgage, but our savings are being eaten away by low interest rates, poor investment conditions and performance, and inflation. We are also affected by a weak pound.
So, 2009 promises fun and games for all. However to be full of doom and gloom is also not helpful - if we all stop spending, retrench and focus in on ourselves and our misery, we will contribute to helping the recession thrive and go on for longer. Perhaps it is time for a nice new pair of shoes in the knowledge that I am helping the economy?
Comments