For years, Economists have been trying to accurately define several things, and recession is one of them. Several definitions of recession have been put forward by the economists to clearly define ‘Economic Recession’. However, the most accepted definition of recession in the context of formal and neoclassical microeconomics is the decline in the GDP (gross domestic product) of a company for more than two quarters.
Julius Shiskin, an economic statistician has suggested several smart rules to identify recession in a New York Times article published in 1975. The most accepted and effective among them was the two quarters down GDP rule. There are other economists who consider a 1.5% unemployment rise in twelve months as the most effective identification of recession.
Economists throughout the world have used different types of indicators and metrics to predict and measure the effect of recession. The global trends that indicate the onset of recession can be categorized in the following ways:
Stock market: The financial experts who are involved in strict financial analysis can identify the effects of recession faster than others. Recession can be identified with the sharp fall and unexpected decline in the stock market average performance. This is the time when investors should carefully invest their money so as not to incur any losses.
Unemployment and layoffs: Recession is also identified by an increased rate of layoff in the companies. The unemployment rate suddenly goes up and several people loose their jobs. Those who survive layoffs, are sometimes asked to take huge cut backs on their salaries. Companies also hire comparatively quite less in number, due to which very less jobs are created. It leads to one of the tough financial times, housing problems and credit troubles.
A downturn in real estate: The residential real estate activities generally grind to a halt during recession. The price of houses will stabilize or even decline.
Gas Price Hike: When you have to pay more at the pump, it is an indication of recession. The sudden hike in the price of gas may get more and more people opt for the little hybrid cars. This is also a strong indication that recession is somewhere around the comer. Moreover, increase in the price of gas means less driving and this subsequently means less spending.
The rising gasoline prices has everyone concerned about the future. Of course, with gasoline being the fuel of the most common form of transportation today, who would not be? And since gasoline is still a major fuel used by most cars in the world, there is nothing that can be done except deal with the changes. People may not have that much of an influence in lowering the current gas prices especially with the great demand for gasoline elsewhere in the world. The most effective means would be making a collective effort of minimizing gasoline use as well as trying to get more out of every gallon of gas as possible.
The pricing of gasoline is a combination of a number of different factors. One of the most important parts is the price of crude oil in the market. You can say that crude oil is the primary raw material from where gasoline is being derived from. In fact gasoline is a major product of crude oil. That is why crude oil accounts for more than half of the price tag of gasoline in gas stations. If the price of crude oil goes up, the price of gasoline also goes up.
Another factor that affects gas prices is the refining costs. Different states require certain refining regulations to be followed. This is to follow the certain standards in refining gasoline to make them acceptable for use locally. Certain refining additions to the process would likely add up to the retail price of gas sold in different states.
Taxes are also considered a prime factor in setting the price tag for gasoline at retail gas stations. Different areas in the country follow different tax standards for gasoline. Aside from the federal taxes, states also have their own set of taxes being placed on petroleum products. The higher the taxes placed on gasoline, the higher its retail price eventually becomes. The difference in state, federal and local taxes is also one of the reaosns why different states have different gasoline prices.
Dealing with the high gasoline prices for the car owner does not depend on these factors however. It has more to deal with trying to get the most out of every drop. And this usually means that car owners try to get the best mileage out of their vehicles when using them.
Good mileage does not usually mean having a new car. It also has a lot to do with a number of factors. For one, driving habits can also affect a car's mileage. Aggressive driving can lay waste to gasoline use and reduce a car's mileage quickly. Drivers who are prone to sudden and quick accelerations and fond of hard braking can put some strain into a car's performance after awhile.
Another means of improving mileage that car owners can actually do is keeping up with their car's scheduled maintenance. As the car is used day in and day out, it can aquire certain wear and tear along the way. A car's scheduled maintenance process would enable the car to get much needed repairs and maintenance work even before things get worse. This can help maintain a car's good mileage. The longer the car enjoys better mileage the better chance a car owner would have in dealing with the rising gasoline prices.
