Bad news for the economy yesterday, which was a surprising change of pace from all the awful news we've been getting lately. The National Bureau of Economic Research (they're awesome guys) announced that yes Virgina, there really is a recession.
Although no-one anywhere admits to being surprised by this news, Wall Street collectively was
surprised and proceeded to lose their shit, sending the Dow down 680 points.
If you're the average Cracked reader (re: Ziploc-bag-fetishist/occasional Sears catalog model) none of those above words will make a lick of sense to you. Seeing as I'm Cracked.com's official Overseas/Heroes/Olympics/Financial Canadian Correspondent, and also because I've recently been instructed to write articles that are really unpopular, I'm here to shed some light on these confusing time.
Ok, first what's a recession?
Much like breasts, economies can never be too large, which is why it's important that they're always slowly growing, and one of a few reasons why we're so disappointed that breasts don't. A recession then is simply a period when an economy stops growing and instead shrinks. Recessions are generally accompanied by rising unemployment, books by John Steinbeck, and a general lack of Good Times.
So should I rush out and buy a big screen television then to save the economy?
Unless that television is 400 billion dollars, I'd suggest you keep your powder dry, tiger. This is a bigger problem than you.
That said it's not a horrible idea, and gets right to the heart of the matter: American's are good at consuming things. In fact, it's probably the one thing you do better than anyone else in the world.* Something like 70% of the American economy is simply you guys buying stuff from each other, or increasingly often, the Chinese. When you stop buying things, the economy slows down, and indeed that's exactly what's happening now.
*Your donuts are excellent as well, I'll add.
Here's the rub though: What if you need that money to eat? You'll feel like a real ass if you go drop eight hundred bones at The Sharper Image only to lose your job in the spring. It will feel like a noose tightening around your neck every morning as you brush your teeth with your talking astrolabe toothbrush. So unless you're really sure your job is safe, it might be wisest to just sock that money away in whatever you traditionally sock things away in (bank account, coffee can, sock.)
So is there any way out of this?
Not an easy way, no. The traditional way to get out of a recession involves the government spending a shit-ton of money on things, preferably big, expensive, durable things. Something that will take a lot of people to build and be useful in the future. Bridges for example, as opposed to hand-jobs. Not to say that 10 billion hand jobs might not take the edge off for everyone over the next few months, but there wouldn't be much to show for it in the end, aside from a country full of cramped wrists and awkward silences.