The Fairy Tale of Recession

Recession is the most talked about topic nowadays, and this word has been overly used by some in their quest to let the public understand the current situation. However, recession has always been used in the context of finance, it has always been referred to as the high-faluting and extremely technical word that the majority of us have no idea about. So what’s the real deal with this “recession” phenomenon? Are we really affected?

Actually, recession is simply a tale of debt, with no happily-ever-after ending. And this is how the story goes: Once upon a time, a rich bank opened his castle doors to peasant debtors, the peasant enjoyed the privilege to the point they are already abusing it. They borrow money to buy well-bred horses, to build fancy houses, to purchase expensive ball dresses. They borrowed money for everything they desire. Since so many already have horses, the price of horses went down. Since fancy houses became common, house were depreciated. Since ball dresses became casual, ball dresses devalued. And since there are surplus of horses, houses and ball dresses, nobody wants to buy them anymore. And with all the peasants borrowing from the rich bank, the treasury eventually collapsed, were emptied, and no money were left. The end.

In its most simple term, recession is debt. It is the story of the debtors and creditors that didn’t turn quite well. And as long as your not part of the debt cycle, and you have no credits, its effect would be as less hurtful as a bite of an ant. Don’t be frightened by these terror stories of recession. Be smart and continue with your everyday life.