In economics, the term recession generally describes the reduction of a country's gross domestic product (GDP) for at least 2 quarters. The usual dictionary definition is "a period of reduced economic activity", a business cycle contraction.
The United States housing market correction (a consequence of United States housing bubble) and subprime mortgage crisis has significantly contributed to a recession.
U.S. employers shed 63,000 jobs in February 2008, the most in five years. Former Federal Reserve chairman Alan Greenspan said on April 6, 2008 that "There is more than a 50 percent chance the United States could go into recession.". On October 1st, the Bureau of Economic Analysis reported that an additional 156,000 jobs had been lost in September. On April 29, 2008, nine US states were declared by Moody’s to be in a recession.
Although the US Economy grew in the first quarter by 1%, by June 2008 some analysts stated that due to a protracted credit crisis and "rampant inflation in commodities such as oil, food and steel", the country was nonetheless in a recession. The third quarter of 2008 brought on a GDP retraction of 0.5% the biggest decline since 2001. The 6.4% decline in spending during Q3 on non-durable goods, like clothing and food, was the largest since 1950