> ## Content Index
> Fetch the complete content index at: https://www.foodconsumer.org/llms.txt
> Use this file to discover other available public pages before exploring further.

# What is a recession?
- URL: https://www.foodconsumer.org/recession_2105100816/
- Published: 2010-05-21T21:15:00.000Z
- Updated: 2026-09-22T16:16:49.000Z
- Description: A plain explainer: a recession is a significant decline in economic activity over two consecutive quarters, visible in GDP, income, employment, production and sales. The Federal Reserve usually responds by lowering interest rates.
- Author: Food Consumer
- Tags: Miscellaneous, Health News, #vivvo-import

Typically, a [recession](http://faq.bea.gov/cgi-bin/bea.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=485&p%5Fcreated=1206966790&p%5Fsid=uWnawPgj&p%5Faccessibility=0&p%5Fredirect=&p%5Flva=&p%5Fsp=cF9zcmNoPSZwX3NvcnRfYnk9JnBfZ3JpZHNvcnQ9JnBfcm93X2NudD0zODMsMzgzJnBfcHJvZHM9JnBfY2F0cz0mcF9wdj0mcF&ref=foodconsumer.org) is a significant decline in economic activity for two consecutive quarters. The decline is normally seen in the real [Gross Domestic Product (GDP)](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=7396&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org), real income, employment, industrial production, and wholesale-retail sales. If a recession occurs over a long period of time, it may develop into a [depression](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=8221&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org).

Recessions are the result of falling demand and may be associated with falling prices (deflation), sharply rising prices (inflation), or a combination of rising prices and slow economic growth. Such a slow-down can be characterized by a number of different trends, including:

- People buying less
- Decreases in factory production
- Growing unemployment
- Slumps in personal income
- An unhealthy stock market

The [Federal Reserve (the Fed)](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=4226&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org) is the central bank of the U.S. and usually responds to recessions by lowering interest rates. Acting through banks and [government securities](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=2938&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org) dealers, the Fed buys and sells government securities on the open market to influence short-term interest rates and the growth of money and credit.

**Deflation**   
Deflation is the fall in the general price level of goods and services, or a reduction of credit and available money. A decrease in government, personal or investment spending can also cause deflation. One of the side effects of deflation is increased[unemployment](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=7002&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org), because there is a lower level of demand in the economy.

**Inflation**   
[Inflation (price inflation)](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=7405&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org) is a rise in the general price level of goods and services over time. Please visit the [Overview of Statistics on Inflation and Prices](http://www.bls.gov/bls/inflation.htm?ref=foodconsumer.org) from the [Bureau of Labor Statistics (BLS)](http://www.bls.gov/?ref=foodconsumer.org) for additional inflation information.

**Additional Resources:**

- [Bureau of Economic Analysis (BEA)](http://www.bea.gov/?ref=foodconsumer.org)
- [Latest Statistics on the Economy](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=6537&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org)
- [National Debt](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=7340&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org)
- [U.S. Financial Crisis](http://answers.usa.gov/cgi-bin/gsa%5Fict.cfg/php/enduser/std%5Fadp.php?p%5Ffaqid=8206&p%5Fsid=a%5FVeNt%2Aj&p%5Flva=8450&ref=foodconsumer.org)