What is the business cycle dating committee

12-Nov-2020 01:42

Some economists believe that the business cycle is a natural part of the economy.But there are others who believe that central banks indirectly control the cycle by intervening with monetary policy.The business cycle is also different from the debt cycle, which refers to the rise and fall in household and government debt.Business cycles are fluctuations in economic activity that an economy experiences over a period of time.During expansion, the economy experiences growth, while a contraction is a period of economic decline. After World War II, expansions were mostly associated with population growth, urban sprawl, and the advent of consumerism.By the 1970s, growth came more from debt injections through consumer credit cards, mortgages, commercial, and industrial loans—as opposed to equity funding—followed by the dot-com speculation and then more mortgage debt. When the expansion occurs, there is an increase in employment, incomes, production, and sales. The economy has a steady flow in the money supply and investment is booming.Many people start to restructure as the economy's growth starts to reverse.

The longest postwar recessions were those of 1973 to 19 to 1982, both of which lasted 16 months.Business cycles are generally measured using the rise and fall in the real gross domestic product (GDP) or the GDP adjusted for inflation.