The Parallax Brief

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Unrepentant Subjectivity on Economics, Politics, Defence, Foreign Policy, and Russia

Recession 101: How the Vicious Cycle Works

A friend yesterday emailed me an excellent story from the Wall Street Journal. It’s a smart concept: to look at one family forced to make cutbacks after redundancy, and examine how their diminished spending affects their whole community.

This is a elegant way of demonstrating how a recession becomes a self perpetuating cycle downward, and why we need stimulus right now.

Recommended reading for anyone interested in the real effects of the current economic turmoil.

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Filed under: Economics, , , , , ,

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