Owen Raskovich

These are the last things you want to be doing with your finances.

Okay, so now that I've spent a long while rehashing what's happened and trying to, I guess, debunk some of the myths about why these events are occurring, let's talk now about the next steps.

So the question on just about everyone's mind is, is there a recession coming here to Australia?

I would say that I have really no crystal ball, but if I did have one and I could gaze into it, my answer would be, I don't know, probably.

So that's my generally right rather than specifically wrong answer to this.

I would say it's likely that we'll experience a recession.

So then the next question is, well, what is a recession?

If you're anything like I was, you probably picture something like London in the 1920s where there's horses and carts and then there's some of those early cars getting on the streets and some guys waving a paper saying recession, recession, recession.

Well, the first thing to know is that is not what a recession would look like here in Australia in this century.

In fact, it would look a lot different to that.

So what is a recession?

Well, a recession is virtually the opposite of growth.

So when I mentioned gross domestic product or GDP earlier on, technically, a recession is just two quarters of a year, meaning one half of a year, where the economy goes backwards.

So let's say that the economy is reported to drop 5% in the first quarter of 2020.

And then in the second quarter, it drops another 5%.

That is a 10% decline, let's say, for round figures overall.

But that's a 10% decline.

And that happens over six months.

That is a recession.

Technically, that's all a recession is.