Recession Or Depression...which Is It?

I keep hearing that we're in a "recession".  Why do I beleive that it's actually a "depression"?

When anyone mentions "depression" everyone thinks back to the early 20th Century and the "Great Depression".  Surely, the name implies that there are "lesser" depressions than that one.

What is the difference between the two?  Which one are we in and why do you think so?

Roaring20s Roaring20s
41-45, M
13 Responses Dec 12, 2008

I found this article but it really doesn't give an answer except that there is no standard definition of either:<br />
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Borderline said it all!!!

Well, AC seeing as how the cheif economists have now told us that we've been in a recession for a year and we still aren't at the deepest levels and there may be worse times ahead, it would lead me to beleive that we are in a depression.<BR><BR>I don't know the latest GDP figures but I'll wager that they've taken quite a hit in the last few months. We have mass unemployment, bankruptcies from individuals and corporations and recovery seems to be a few years away is the way I'm reading it.

I think that maybe you're onto something there. Is a recession isolated to only a small number of global economies whereas a depression is pretty much the entire global economy?

But what is the line that differentiates them?? That's where my confusion is. Seems like everyone has their own differing definition of what one is as opposed to the other one.

i think were in a recession which if we are not careful can turn into another depression!

So which is it....recession or depression??

A recession is when you neighbor looses his job. A depression is when you loose your job.

No insult taken Boarderline...just saying that I'm in that boat too.<br />
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I guess then it also has to depend on your definition of rich. A lot of people who were "well off" lost a lot in the stock and bonds markets. A lot have lost their jobs (usually upper middle management).<br />
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The truly rich probably aren't hurting much at this point but them neither are the truly poor who just didn't have it to lose.

Sorry about the comment on have and have nots. I was just venting. I didn't mean to insult anyone.<br />
I agree with your how much worse does it have to get before it gets better question. <br />
But I still say they will officially call it a depression when the rich start hurting.

I really don't want this discussion to turn into a "haves vs have nots" thing.<BR><BR>As an example, I have nice things, nice clothes, nice car because I had a good job that I lost. I now make significantly less (66% less). Just because of what I drive or what I wear doesn't mean that I don't need help now. So let's forgo this type of responses as it's not really relevant to the question asked.<BR><BR>I think that we're in a depression. I guess we all have our definitions and the economists all have theirs but anytime people are losing jobs and their homes at this alarming rate I can't just say it's a recession.<BR><BR>To me a recession is evidenced by a shrinking dollar vs other world currencies, a slowing (not screeching halt of) job market, slowing retail sales, slowing or stagnant wages.<BR><BR>A depression is a total collapse of the banking and manufacturing sectors of our economy with global results, massive layoffs and closings of companies, homeownership levels falling at a fast pace, wages decreasing as everything else increases in cost and/or price, retail sales barely keeping pace with the previous fiscal year and in some cases slowing.<BR><BR>I just couldn't believe it a few weeks ago when the light bulb went off in someone's head and they declared quite publicly that we had been in a recession since last December. I just wanted to smack the fool in the head and say "no **** Sherlock".<BR><BR>This mess is going to take a while to get out of and I keep hearing that it's going to get worse before it gets better. How much worse does it need to be before this same big brained economist comes out and says "why yes, this is a depression and we've been in one for a year"?

Every time I have to go to Public aid for help I see people in there wearing outfits that I could only afford to look at (sometimes I can't even afford to look). It makes me sick to see the expensive cars parked out in the lot. If these middle class people just quit buying expensive clothes and cars maybe they wouldn't have to ask for help.

I figure we're in a recession right now. A recession is when the poor and middle class is hurting from lack of money. The rich people still have their money, so they don't worry about it.<br />
A depression is when the rich people start hurting from lack of money. Then they can say, "we're depressed". <br />
This country only seems to care about the people who have the money. The rest of us are just here.<br />
This is just my opinion!