Signs of crisis
During the crisis following the bankruptcy of financial
institutions and banks, there is a bankruptcy of many
companies and enterprises, which results in a can tings
group, job losses and job cuts.
Overall, the crisis is manifested by a sudden deterioration
of the economy.
The first sign of impending crisis are declines in stock
market or stock market crash turning into a long-term
slump. Before that the problem could be seen in the
statistics regarding transactions , so called „futures” that
show what trend is expected in the near future.
The symptoms of the crisis are:

galloping inflation turning into hyperinflation

decline in production

decline in wages or salaries

decline in employment rate

decline in income

decrease in consumption

decline in investment

drop of GDP

increase in unemployment

increase in the budget deficit

increase in the fiscal deficit

downward trend in tax revenues of the state budget

slows of the growth rate of industrial production

reduced rate of exports and business investment
The most important concepts
related to the economic crisis
Inflation-the process of growth of the general price
level
Types of inflation

according to the criterion of the rate:

creeping -does not exceed 5% per year

moderate inflation -is in the range of 5% - 10% per year

galloping - annual price increase of minimum 50%

hyperinflation-monthly increase in prices of more than 150%
Unemployment

Unemployment-Unemployment occurs when a person who
actively searches for employment is unable to find work.

Long-term unemployment – when unemployed a person
remains out of work for at least 12 months in the past 24 months
The budget deficit
The budget deficit - occurs when expenditures in the
budget of the institution are higher than its income
The budget deficit may be due to:

- excessive budget spendings (the militarization of the economy,
expanded government structure, public investments, transfers, high
maintenance of the costs of foreign and domestic debt)

-too low budget revenue, which may result from the low tax rate, little
effective tax collection system or from falling levels of production and
national income

-public expectations that the state will fulfill a guarantor features of
social safety, funding part of the consumption of poorer parts of society

- methods to establish the budget in a parliamentary system. Various
social forces - on the one hand are interested in minimizing taxes, on
the other hand maximizing spending. However, no one is interested in
balancing income with expenditure.
Trade deficit -An economic measure of a negative
balance of trade in which a country's imports
exceeds its exports. A trade deficit represents an
outflow of domestic currency to foreign markets.
Consumption -in macroeconomics , it regards
household spending on goods
Consumption -in macroeconomics , it regards household
spending on goods
In this sense , we distinguish autonomous consumption
and additional one. Autonomous consumption is
independent of income. Additional consumption is,
however, conditional on the amount of income ; it means
expenditures for goods that are not essential for life .