How bad is the economy: Recession vs. Great Depression?
While the events of the past two weeks were dramatic, they do not rival the Great Depression. Then, 1,500 banks went under, factories closed, and one in four Americans was out of work. The current crisis hit Wall Street hard but has not devastated the US economy. Unemployment in August was 6.1 percent, a historically low rate, and the United States is technically not in a recession, which is defined by two consecutive quarters of negative economic growth – the economy grew 2.8 percent in the second quarter, the latest data available. However, many economists believe the country entered recession in the third quarter, and if the financial system does not stabilize the economy may enter a long, deep downturn. Next year, Global Insight predicted, the US economy would grow less than 1 percent, and the jobless rate could reach 7 percent – or higher. Things could be worse without an injection of federal bailout money into the system, which would offset some of the negative impact of the cred
