I’m seeing a lot of people on the TL panic about the UK recession. There’s various things to consider and economists were definitely anticipating it. Please don’t buy the scaremongering that’s going on by comparing it to the 08 financial crisis. Two completely different scenarios

A recession is two consecutive quarters of negative GDP growth. GDP is a measure of the total value of goods and services produced by a country in an given time period. Given that we’ve just been through an extensive lockdown it’s expected that production is really low.

The financial crisis in 2008 happened on the back of an economic boom, this recession is happening on the back of a global pandemic. It’s not rationale to explicitly compare the two recessions. The key thing to consider is if the economy was to fully reopen tomorrow

Would our country collectively be able to produce the same amount of goods and services it managed prior to the pandemic. The answer is definitely not. As a country our productive capacity is falling fast. If the country was to fully reopen so many businesses won’t go back

To trading because sadly they haven’t be able to survive the lockdown. Hence their “output”, which is crucial to our GDP numbers, drops. This causes long term unemployment and the economy gets caught in a vicious cycle.

All eyes will turn to Rishi S to see how he can keep the economy ticking over however it’s all going to come at a cost. The truth being this country has years of austerity ahead. The 2008 crisis was due to poor regulation and people taking borrowing money they couldn’t afford

To pay back. Very different situation but somewhat similar end results. The solution to the 2020 crisis is not the same as the 2008 crisis. This is truly unprecedented times.