What Is A Recession?

Since the pandemic the economy has been turbulent to say the least. We have heard discussions of inflation, and many are often unaware of what it is or how it could impact our day to day lives.
Inflation is an economic concept that refers to the overall increase in the prices of goods and services in an economy. The inflation rate is the percentage rate of change in prices over a certain period of time, typically a year. Inflation can have a number of different causes, but is most often associated with an increase in the money supply or a decrease in the production of goods and services.

When the money supply increases, each unit of currency buys fewer goods and services, leading to inflation. When the production of goods and services decreases, the prices of those goods and services increase, leading to inflation. Given the problems with the supply chain and workforce, many Americans are feeling the effects of inflation in their everyday lives and wallets.

Rising Costs, Sinking Values

Inflation isn’t the only growing concern in recent weeks. Many economists are now concerned about the rising chances of a full recession. A recession is a period of time where there is a general decline in economic activity. This can be caused by many factors, such as a decrease in consumer spending, an increase in taxes, or a decrease in government spending.

Inflation can be a cause of recession, as increased prices lead to lower spending and demand in the economy. Recessions can last for a few months or a few years, and they can have a major impact on the economy. During a recession, unemployment typically increases, as businesses lay off workers to cut costs. Inflation may also decline during a recession, as businesses cut prices to attract customers.
As economists and the government scramble to combat the rising inflation and looming chances of a recession, many are left wondering how bad things may negatively impact their lives.

If you are experiencing problems with debt, have recently lost your source of income, or have property facing repossession or foreclosure; contact an Elk Grove bankruptcy attorney today. Our team of experts can help you prepare for the recession financially, protect your property, and resolve your debts to better prepare for the uncertainty ahead.