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Starting from 2007 the world economy is slipping down more and more. Although the situation has improved since the stock market and the subprime mortgage market crash, but the number of unemployment is still rising, businesses stop their expansion, houses prices are still dropping and the GDP growth is still slow. As the textbook says, recession means negative GDP growth during two consecutive quarters, so according to this, recession is still haunting, having three quarters of negative growth during 2008-2009. Not to talk about the year of 2007. If there is such thing, the only good thing during recession is its ability to cure inflation. Without triggering a recession the Federal Reserve balancing act has to slow the economy, usually doing it without the fiscal policy’s help. Politicians are trying to stimulate the economy as much as they can by lowering taxes, ignoring the budget deficits and spending on social program.

Of course there are some individuals, if not the majority of them who do not feel the recession; they are still having their jobs, their house and car, living happily with their family; the recession affects states and financial institutes in a major way. After trying to manage the risks provided by the subprime mortgage market collapse, states have created more risks, by adopting the help of secularization. The results and extent of the problems bought by secularization were so major, that many of the world’s leading financial institutions have collapsed. The most powerful nations’ governments were turning to the remaining large financial institutions and banks to bail-out and get financial rescue packages.

According to Bloomberg, in October 2009, from a world credit loss of 2.8 trillion $, in bailout packages and plans US taxpayers will spend alone 9.7 trillion $. By this crisis 33% or $14.5 trillion of the world’s companies were wiped out. But not only the US has spent trillions on bailout and aid packages, Europe is claimed to have spent $2 trillion too. Everyone expected the situation to reverse, but more spending, more financial aid requiring from the governments of the wealthiest nations are coming in the year of 2010. Will this year be the last circle of recession or the situational reverse would still have to wait?