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A depression is a severe and prolonged downturn in economic activity. A depression may be defined as an extreme recession that lasts three or more years or which leads to a decline in real gross domestic product (GDP) of at least 10% in a given year.

Depressions are far less common than milder recessions. Both tend to be accompanied by relatively high unemployment and relatively low inflation.

The U.S. has experienced at least 34 recessions since 1850 including, in recent years, the Great Recession of 2008-2009 and the covid recession of 2020. But it has had only one depression, which lasted from 1929 until 1939 and is known as the Great Depression

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