Do you see all these - Sgins of RECESSIONS or An Oppurtunity?

Economic recessions are caused by a decline in GDP growth, if two consecutive quarters are measured with a contraction then that particular country is considered to have fallen into a recession. These are results of negative growth or a slowdown, or a drop in employment or an increase in job losses thus leading to higher unemployment, a drop manufacturing outputs/orders, contraction in retail sales, and a stock market going into a bear market and raising inflation that is turning into a recessionary economy.

Usually there are numerous causes that leads to a recession, however and whenever one occurs, it's all cyclical.

The recession of 2001 and the 2008/2009 is an example we can use.

1) The IT bubble.

Well before the IT bubble burst in 2000, (a economic boom in computer and soft wares sales because of the operating code of most PC, Main Frames, Sub-Main Frames wouldn't be able to understand the difference between 2000 and 1900). Thus the dot.com era surfaced, with an unimaginable truth - most computers has a shelf-life of two years before they become obsolete. So when the "cat is out of the bag" - there will be a drop in sales orders for the next 2 years from year 2000 (after most companies upgraded their hard-wares and soft-wares before 2000), the stock market decline and drop with MANY dot.com companies going bankrupt as there will be low or no sales for the IT industry. So the 2001 recessionary cycle kick in.

2) Federal Reserve is the cause that lead to the 2000 recession - high interest rates!

With high interest rates, as high as 6.5% in year 2000 set by the Feds. If I am not wrong after this Alan Greenspan has always being advocating for a policy of low interest rates. When interest rates were kept high there will be a short supply of money/cash in the market. When money dries up, business starts to grain to a halt. Loans, mortgages, cost of doing business all short up and went through the ceilings. This was another reason that cause this recession in year 2000. So this lead to a low interest regime thus the kick start of slowed down economy (with the low interest rate regime it leads to the HOUSING BUBBLE in 2006 - 2007 whereby people bought houses they could not afford)

3) The Sub-Prime Loans "trickery" of the USA - cause of our recent 2008/2009 global recession.

The people who were the cause of these sub-prime loans bundling or packaging ought to be held and charge with falsifying with a clear intention to cheat. (how I wish they were prosecuted in Japan or China, those responsible) So the foreclosure after foreclosure with selling price of houses that were below the loan amount that borrowers owed. Domino effect took effect, one after another bank went into huge losses or were cash flow negative. Then came the hedge funds, they sold and could not cover their losses at times hedging at a multiple of 30 times to each US$ 1.00. The likes of Bears Stearns, AIG, Fannie Mae, and Freedie Mac were then all over the news with bailouts, of US$ 700 to 800 billion. Till today unemployment in US is still at a high but has since improve from over 800,000 job losses to currently well below 400,000.

It is now 'twenty-eleven' what is installed for 2012.

So all in all, with a US$ 16 trillion debt US has build up since 1918 (after WW 1). US have being increasing their debt ceiling ever since, now they are deem (by the out going head, he will be replaced by his deputy or amputee) of a rating agency that said; US ratings is no longer triple A. Good grieve after so so so long being a"bankrupt" nation that is and was surviving on borrowed money for the rest of the world. Thus the sell down in August 2011 since the down grading. US jobless is still at 9% and the general view that if 2012 will be a zero growth year globally. Countries on the other side of US and Europe will benefit and continue to have a positive GDP growth albeit slower but still positive.

Hey people could this be the decoupling that the rest of the world is waiting for and a new world order? That's why old mind sets must change.

Cheers
TjLim