Recession

A recession is a significant, widespread decline in economic activity, commonly defined as two consecutive quarters of shrinking GDP. Recessions typically bring rising unemployment, falling consumer spending, and weaker corporate earnings.

Not every slowdown becomes an official recession, and the exact timing of a recession is often only confirmed well after the fact. Stock prices frequently start falling before a recession officially begins and often start recovering before it officially ends, since markets tend to price in expectations about the economy rather than just react to current conditions.