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A significant and sustained decline in economic activity, commonly defined as two consecutive quarters of negative GDP growth.
In the U.S., recessions are officially declared by the National Bureau of Economic Research (NBER), which considers employment, industrial production, retail sales, and income in addition to GDP. Since World War II, there have been 12 recessions, lasting an average of about 10 months. The 2008 Great Recession lasted 18 months and resulted in the stock market losing over 50%. Recessions typically feature rising unemployment, declining corporate profits, falling consumer confidence, and contracting credit. However, they also set the stage for the next expansion, as asset prices reset and pent-up demand builds. Stocks have historically bottomed before the recession officially ends.