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{ 1 comment… read it below or add one }
Essentially a recession is a shrinking economy (less buying and selling going on) and a recession ends once confidence returns and the economy starts growing again.
In the case of the US, the recession was started by the sub-prime lending crisis and the consequent credit crunch, but in general recessions can have many different causes.
If left well alone a recession will cure itself, but politicians are impatient and want to be seen to be doing something. Hence the calls for economic stimulus at the G20 meeting.
The problem with economic stimuli such as quantitative easing is that they can easily turn into galloping inflation once the economy starts to recover.