Now the topic of a looming recession is thrown out pretty much every year since the last

recession in many different forms and fashions, so it’s no surprise that it is, again, in the

headlines as a topic of discussion. But how serious should we take these recession warnings?

First, let’s define what it is. You hear this fear-inducing word that makes you think of stagnant or

declining wages, layoffs, unemployment, reduced economic activity, foreclosures, to name

some. According to Webster a recession is, “the act or action of receding” but in terms of an

economy it simply means two consecutive periods (to which each period or quarter is three

months) where economic activity is reduced. When looking at the official onset of a recession,

we turn to NBER which shows the business cycle.