Monday, November 3, 2008

Credit Crunch or Recession?

Just who was it that came up with the idea of the phrase 'Credit Crunch'?
I hate it when they do this. As far as I am concerned the 'Credit Crunch' means recession. Thats what they should have called it from the beginning. In my book the following equation results in what we can technically call a recession.

Financial downturn + Banks in trouble + Businesses in trouble + Job Losses + Less Retail Spending + Lower standard of living + Repossessions + Poverty = RECESSION

I find a great number of things disturbing about this recession.

1. How can this still be happening in the 21st Century?
2. Why does the world economy have to suffer when the roots of the recession begin in a single country?
3. Why were various financial institutions not monitored enough to ensure they were operating within correct guidelines.
4. The fact that it is the every day tax payer who is having to bail out those whose greed in part are responsible for the recession.
5. A media frenzy that has practically scared us into recession.

What do you think. Was there ever a credit crunch or has it been a recession all along and the powers that be just could not admit to it.