History of Recession in Timeline

A recession is an economic contraction marked by a broad decline in economic activity, typically triggered by a drop in spending stemming from events like financial crises, trade shocks, or disasters. According to the International Monetary Fund, there's no single official definition of a recession, but it generally signifies a downturn in the business cycle.

1931: Beginning of Australia's Biggest Recession

In 1931, Australia started experiencing its biggest recession in history, resulting from late 1920s profit issues in agriculture and cutbacks.

1932: Continuation of Australia's Recession

In 1932, Australia continued experiencing its biggest recession in history, but it fared better than other nations due to greater productivity in manufacturing.

1947: No Recession Declaration in 1947

In 1947, the NBER did not declare a recession despite two quarters of declining GDP due to strong economic activity reported for employment, industrial production, and consumer spending.

1948: Recessions and Stock Market Declines

In Stocks for the Long Run, Siegel mentions that since 1948, ten recessions were preceded by a stock market decline, by a lead time of 0 to 13 months (average 5.7 months), while ten stock market declines of greater than 10% in the Dow Jones Industrial Average were not followed by a recession.

1949: W-shaped Recession in the US

In 1949, the United States experienced a W-shaped recession, also known as a double-dip recession.

1954: V-shaped Recession in the US

In 1954, the United States experienced a V-shaped recession, characterized by a short and sharp economic contraction followed by a rapid and sustained recovery.

1961: Brief Recession in Australia

In 1961, Australia experienced a brief recession due to a credit squeeze.

1970: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1973: Rising Inflation in Australia

In 1973, Australia faced a rising level of inflation, partially caused by the oil crisis, leading to a 13% increase in inflation.

1974: Economic Recession Hit Australia

By mid-1974, an economic recession struck Australia, with no policy changes enacted by the government, leading to increased unemployment and trade deficit.

1974: U-shaped Recession in the US

From 1974 to 1975, the United States experienced a U-shaped recession, characterized by a prolonged economic slump.

1974: Julius Shiskin's Recession Definition

In 1974, Julius Shiskin, Commissioner of the Bureau of Labor Statistics, proposed a quantitative definition of a recession in The New York Times, translating the bureau's qualitative definition into a more accessible form.

1974: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1975: U-shaped Recession in the US

From 1974 to 1975, the United States experienced a U-shaped recession, characterized by a prolonged economic slump.

1975: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1980: W-shaped Recession in the US

From 1980 to 1982, the United States experienced a W-shaped recession, also known as a double-dip recession.

1980: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1981: 1981 Recession Cause

The 1981 recession is thought to have been caused by the tight-money policy adopted by Paul Volcker, chairman of the Federal Reserve Board.

1982: W-shaped Recession in the US

From 1980 to 1982, the United States experienced a W-shaped recession, also known as a double-dip recession.

1983: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

October 1987: Stock Market Collapse (Black Monday)

In October 1987, a major stock collapse, known as Black Monday, triggered another recession, although the global economy recovered quickly.

1990: Japan's Great Recession

Economist Richard Koo stated that Japan's "Great Recession" began in 1990 and was triggered by a collapse in land and stock prices, causing firms to have negative equity.

1990: V-shaped Recession in the US

In 1990, the United States experienced a V-shaped recession, characterized by a short and sharp economic contraction followed by a rapid and sustained recovery.

1990: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1991: V-shaped Recession in the US

In 1991, the United States experienced a V-shaped recession, characterized by a short and sharp economic contraction followed by a rapid and sustained recovery.

1993: U-shaped Recession in Japan

From 1993 to 1994, Japan experienced a U-shaped recession, characterized by a prolonged economic slump.

1993: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1994: U-shaped Recession in Japan

From 1993 to 1994, Japan experienced a U-shaped recession, characterized by a prolonged economic slump.

1997: L-shaped Recession in Thailand, U-shaped Recessions in Korea, Hong Kong and South-east Asia

From 1997 to 1999, Japan experienced an L-shaped recession with eight out of nine quarters of contraction. Korea, Hong Kong, and South-east Asia experienced U-shaped recessions in 1997-1998, while Thailand's eight consecutive quarters of decline were L-shaped.

1998: Japanese Firms as Net Savers

After 1998, Japanese firms overall became net savers, as opposed to borrowers, during Japan's "Great Recession".

1998: U-shaped Recessions in Korea, Hong Kong and South-east Asia

1998: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

1999: L-shaped Recession in Japan

2001: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

2001: 2001 Recession in the US

The 2001 recession in the U.S. did not involve two consecutive quarters of decline but was preceded by two quarters of alternating decline and weak growth.

April 2002: IMF on Global Recessions

In April 2002, the IMF stated that during the past three global recessions of the last three decades, global per capita output growth was zero or negative and argued that because of the opposite being found for 2001, the economic state in this year by itself did not qualify as a global recession.

2003: Decline in Corporate Investment in Japan

Between 1990 and 2003, corporate investment in Japan experienced a peak decline, falling by 22% of GDP, during Japan's "Great Recession".

December 2007: Peak of Economic Activity

According to a December 2008 report from the National Bureau of Economic Research, economic activity in the U.S. peaked in December 2007, marking the start of the recession.

December 2007: Start of Recession in the US

The recession started in December 2007, leading to a substantial increase in unemployment by March 2009.

2007: Start of 2007-2009 Recession

The 2007-2009 recession began, leading to a fall in private consumption for the first time in nearly 20 years.

2007: US Enters Recession

The US entered a recession at the end of 2007, preceding a global economic downturn.

February 2008: Job Losses in the U.S.

In February 2008, U.S. employers shed 63,000 jobs, marking the most significant job losses in five years.

April 2008: Start of Recession (Report)

According to a November 2008 report from the Federal Reserve Bank of Philadelphia, the recession started in April 2008 and was expected to last 14 months.

April 2008: Greenspan's Recession Prediction and Moody's Declaration

On April 6, 2008, Alan Greenspan indicated a greater than 50% chance of the United States entering a recession. On April 29, 2008, Moody's declared that nine US states were in a recession.

June 2008: Recession Concerns Amidst Economic Growth

Despite the US economy growing by 1% in the first quarter, some analysts stated in June 2008 that the country was in a recession due to a credit crisis and rampant inflation in commodities such as oil, food, and steel.

November 2008: Federal Reserve Bank Report on Recession

A November 2008 report from the Federal Reserve Bank of Philadelphia suggested that the recession started in April 2008 and would last 14 months.

November 2008: Massive Job Losses in the U.S.

In November 2008, U.S. employers eliminated 533,000 jobs, representing the largest single-month loss in 34 years.

December 2008: NBER Declares U.S. Recession

In December 2008, the National Bureau of Economic Research (NBER) stated that the U.S. had been in a recession since December 2007.

2008: Economic Crisis

Following the economic crisis of 2008, Gauti B. Eggertsson of the Federal Reserve Bank of New York writes that cutting taxes on labor or capital is contractionary under certain circumstances.

2008: Global Spread of Recession

In 2008, many nations followed the US into recession, marking a significant global economic downturn.

2008: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

March 2009: Unemployment Rate Increase in U.S.

In March 2009, the unemployment rate in the U.S. grew to 8.5%, with 5.1 million job losses since the recession began in December 2007.

April 2009: IMF changes global recession definition

In April 2009, the International Monetary Fund (IMF) revised its definition of a global recession to include a decline in annual per capita real World GDP, backed by worsening macroeconomic indicators.

April 2009: IMF on Global Recessions

Until April 2009, the IMF communicated that a global annual real GDP growth of 3.0% or less was "equivalent to a global recession".

June 2009: End of Recession Announced

The National Bureau of Economic Research announced on 20 September 2010 that the 2008/2009 recession ended in June 2009, making it the longest recession since World War II.

June 2009: End of US Recession

The US recession of 2007, which began in 2007, officially ended in June 2009, marking the start of the current economic recovery.

July 2009: Economists Believe Recession May Have Ended

By July 2009, many economists believed that the recession, which began in December 2007, may have ended.

2009: Lack of Recession Predictions

Analysis by Prakash Loungani of the International Monetary Fund found there were zero consensus predictions one year earlier for the 49 recessions during 2009.

2009: U.S. Recession Described as Liquidity Trap

Economist Paul Krugman described the U.S. 2009 recession as a liquidity trap.

2009: Projected GDP Decline

In November 2008, the Federal Reserve Bank of Philadelphia projected real GDP declining at an annual rate of 1.1% in the first quarter of 2009.

2009: Periods of Global Recession

Since 1970, six periods qualify as global recessions, including 1974–1975, 1980–1983, 1990–1993, 1998, 2001–2002, and 2008–2009.

2009: Continuation of 2007-2009 Recession

The 2007-2009 recession continued in 2009, with low consumer confidence prolonging economic recovery and impacting U.S. households significantly.

March 2010: Krugman on Liquidity Trap

In March 2010, economist Paul Krugman estimated that developed countries representing 70% of the world's GDP were caught in a liquidity trap.

September 2010: NBER Announces End of Recession

On September 20, 2010, the National Bureau of Economic Research announced that the 2008/2009 recession ended in June 2009, making it the longest recession since World War II.

December 2010: Krugman on Government Spending

In December 2010, Paul Krugman wrote that significant, sustained government spending was necessary because indebted households were paying down debts and unable to carry the U.S. economy as they had previously.

2010: Krugman on Balance Sheet Recession

In 2010, Paul Krugman discussed the balance sheet recession concept, agreeing with Koo's assessment and suggesting that sustained deficit spending would be appropriate. Krugman argued monetary policy could affect savings behavior through inflation expectations.

July 2012: Balance Sheet Recession Research

In July 2012, a survey of balance sheet recession research reported that consumer demand and employment are affected by household leverage levels and the decline in property values during the subprime mortgage crisis.

2012: Eurozone Recession

In 2012, the Eurozone experienced a recession, with the economies of the 17-nation region failing to grow during any quarter of the year, and the recession deepened during the final quarter, affecting France, Germany, and Italy.

2014: Paul Krugman on Balance Sheet Recession

In 2014, economist Paul Krugman suggested that the financial crisis was a manifestation of excessive debt, describing it as a "balance sheet recession". He advocated for debt reduction strategies combined with increased government spending.

2017: Patel's Research on Recession Impact

In 2017, Patel's research focused on the impact of various factors on economic downturns, contributing to the formulation of effective strategies for mitigating their impact.

2017: Tax Cuts and Jobs Act

In 2017, the Trump administration claimed that lower effective tax rates on new investment imposed by the Tax Cuts and Jobs Act would raise investment, thereby making workers more productive and raising output and wages.

2018: Smith's Recession Analysis

In 2018, Smith's research contributed to the understanding of recessions by examining the declines in GDP components, including consumption and investment, and the impact of factors like employment and interest rates.

2019: Anderson's Insights on Economic Downturns

In 2019, Anderson provided insights into the complex dynamics contributing to economic downturns, emphasizing the need for comprehensive strategies to mitigate their impact.

2019: Investment Patterns in the US

In 2019, investment patterns in the United States indicated that the supply-side incentives of the TCJA had little effect on investment growth, with much of the increase being a response to oil prices.

February 2020: Start of COVID-19 Recession

In February 2020, the NBER declared a 2-month COVID-19 recession that lasted from February 2020 to April 2020.

March 2020: Recession Begins in Australia

In March 2020, Australia entered a recession due to the impact of bush fires and the COVID-19 pandemic's effect on tourism and the economy.

April 2020: End of COVID-19 Recession

In April 2020, the NBER declared a 2-month COVID-19 recession that lasted from February 2020 to April 2020.

May 2020: End of Recession in Australia

By May 2020, the recession in Australia, which had started in March 2020, ended.

2020: Johnson & Thompson on Economic Activity

In 2020, Johnson & Thompson's work highlighted the significance of economic activity measures in understanding recessions, emphasizing the importance of factors such as household savings rates and corporate investment decisions.

2020: UK Recession due to COVID-19

In 2020, the United Kingdom experienced a recession attributed to the COVID-19 global pandemic, marking its first recession since the Great Recession.

2021: Inflation Surge

In July 2022, the longest and deepest Treasury yield curve inversion in history began, as the Federal Reserve sharply increased the fed funds rate to combat the 2021–2023 inflation surge.

July 2022: Treasury Yield Curve Inversion

In July 2022, the longest and deepest Treasury yield curve inversion in history began, as the Federal Reserve sharply increased the fed funds rate to combat the 2021–2023 inflation surge.

2023: Inflation Surge

In July 2022, the longest and deepest Treasury yield curve inversion in history began, as the Federal Reserve sharply increased the fed funds rate to combat the 2021–2023 inflation surge.

June 2024: Yield Curve Re-steepening

In June 2024, the yield curve began re-steepening toward positive territory, as it had at other points during that inversion.

July 2024: Economic Growth Despite Recession Predictions

By July 2024, despite widespread predictions of an imminent recession, economic growth remained steady, and a Reuters survey of economists expected the economy to continue growing for the next two years.