The Importance Of Recession In America

We live in an economy that is unpredictable, we never know what exactly may happen. We depend on numerous of observations and hypotheses. In America everything is bigger and better, as they say. As Americans we want to be a successful and a well-functionally country. We can not have slumping markets where the cost of the average total cost increases. This is described as a long-lasting recession that is better to avoid then having to deal with the consequences.
There are a few ways that our economy can prevent a recession; cutting interest rates to possibly boost demand, expansionary fiscal policy by cutting taxes to make consumers spend more, and or devaluation. With a temporary economic decline in our economy it may cause for long lasting outcomes. As an economy, we must try to prevent any defects that would hurt us as a whole. …show more content…
“High interest rates are a cause of recession because they limit liquidity, or the amount of money available to invest” (What Is). Cutting these interest rates simply means a way of giving consumers more money of their own to spend and give it back, generating the economy. With consumers having to spend their money on high interest rates there would be no money being spent within their community, workers wouldn’t make money to spend for themselves.
Along with cutting interest rates in preventing a recession, expansionary fiscal policy can be called into play. This policy was created to generate the economy of our business-cycle. “Expansionary fiscal policy involves an increase in the funds appropriated…which stimulate aggregate production, boost income, and increase the level of employment” (AmosWEB). We as an economy need money flowing so therefore everyone is benefiting. People shouldn’t loss their jobs because money isn’t being made, that should not be the case. Even though recessions are temporary, we don’t want permanent