What is the purpose of a recession?

Dispassionate

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A loose answer would be to re-establish economic soundness, but can anyone offer more detailed answers?
 
A recession doesn't have a purpose. It's not a conscious thing. It's just a state of economic being.
 
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It swings the pendulum to the opposite end, from Feast to Famine.
If ever it gets to stay in the middle you'll know that life is as it should be - in a sensible balance.
Human nature means that being in the middle doesn't happen for long.
 
Recession depression is demise death pruning clearing of the deadwood.
From this comes new growth. ( in theory )
 
A loose answer would be to re-establish economic soundness, but can anyone offer more detailed answers?


Yes. What happened 6 months ago, really had no effect on what happened yesterday to you!

It is is all reality, a pre designed plan for those that have masses of money to simply take more money from the people that do not have enough in the first place.

6 months ago your house was worth 200,000. Now it is worth 140,000.

What has changed?

Answer: **** all. It is all man made by manipulators.

Free trade?

**** off.
 
But a depression or recession is not a "thing."

A recession is just part of the pattern of business/economic growth known as the business cycle. It doesn't have a purpose but it does have effects, symptoms if you will. Those effects come about because the recession is the part of the business cycle where prior excesses in growth have overrun and are exposed by a drop in growth. Examples include:
- too many employees because of growth . unemployment
- even bad businesses survive in a rising market . business failure
- even profligate government spending (Australia) is ok . deficits, pain, stupid promises reneged on
- even private overborrowing is ok when wages and economies rise . foreclosures, bankruptcy.

You get the picture: no purpose, only effects appropriate to this stage of a small rise and fall cycle.

The big question: how small a rise and fall cycle is this?
 
recession

A loose answer would be to re-establish economic soundness, but can anyone offer more detailed answers?

YouTube - The History of Economic Cycles

After innovation prosperity phase slacken and stops, not as much credit is created anymore. “there is more brain in business” at large during recessions than there is during prosperity. The recession is the time of harvesting the results of preceding innovations.

Nine Tx for the tread on trading psychology
 
But a depression or recession is not a "thing."

A recession is just part of the pattern of business/economic growth known as the business cycle. It doesn't have a purpose but it does have effects, symptoms if you will. Those effects come about because the recession is the part of the business cycle where prior excesses in growth have overrun and are exposed by a drop in growth. Examples include:
- too many employees because of growth . unemployment
- even bad businesses survive in a rising market . business failure
- even profligate government spending (Australia) is ok . deficits, pain, stupid promises reneged on
- even private overborrowing is ok when wages and economies rise . foreclosures, bankruptcy.

You get the picture: no purpose, only effects appropriate to this stage of a small rise and fall cycle.

The big question: how small a rise and fall cycle is this?

It's a phenonema, so it's a thing. Part of the purpose would be to make the bad things you listed good.
 
I disagree - a recession is not a thing - it is a adjective decribing the rate of change of a thing (i.e. the economy) reaching a set definition.

It is just a label we apply to a set of defined conditions occuring. There is no purpose to it - that would suggest it was a deliberate act - i.e. a cause - but recession is merely an effect of previous actions.
 
re:recession

It's a phenonema, so it's a thing. Part of the purpose would be to make the bad things you listed good.

Hi
I think the only thing you can "make" as a government is to don`t let the vicious spiral roll into depression, to eventually establish lower level equilibrium there. Of course the purpose for it is the rescue of those who need the most (no doubt the purpose).
But I don`t think you can 'make' it any better than that without incurring longer time frame costs...
 
Recession is the opposite of progression. Not only it's the difference between shrinking and expanding, but progression is usually established due to some sort of collective planned effort by a living organism, wanting or needing the expansion for it's survival, thus having purpose. Recession is the opposite, usually unplanned and unwanted and lacking the collective effort since it's not a goal and lacks purpose. As such is the balance of the universe; light and dark, black and white, wanted and unwanted, purpose and no purpose. Life and death.. can I hear an Amen?
 
Amen?

On the top of the prosperity phase (progression) usually productivity declines as the new entrepreneurs stop borrowing money from the banks and start repaying them. There comes the recession, which is not necessarily the bad bit. Other case is the M4 build up as a buffer to the economic mountain. There starts the ride :p
 
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