Regan was the most practical man when he explained recession. Year 2008 marked the most serious recession after the great depression in 1930. But the worst was not yet over. In 2008 it started with Lehman brothers. In 2011 it started with Greece and the US. Now it is evident that we are affected by recession by and large. Here are the repercussions of a recession, so be prepared.

What will happen globally?
1, Recession may lead to depression. Depression is similar to stagnation of business activities. During recession almost all the governments would cut government spending, this will make life lot more painful.
2, Recession means loss of job to an ordinary working man. Financial sector will be the worst hit. Countries may give preference to their natives during recession. They may expel the foreign work force.
3, Recession will lead to economic instability in almost all the nations. The situations in the US and Europe will become worse.
4, Loan will be more costly or you may not get loans.
5, Recession will definitely affect the imports, which indirectly affects the trade deficit of countries. Emerging economies like India will be the most affected by this phenomenon.
6, Job loss in the unorganized sector will be more. Number and percentage of economic crimes will increase all over the globe.

How it will affect India
1, Crude oil prices may cool off, this is a positive development as far as India’s fortunes are considered.
2, many economists believe that a new world economic order will emerge after recession. Then India and China will be the emerging stars.
3, During recession IT companies will have lesser orders-negative development for the IT and ITES industry.
4, Recession, be it of any kind, is negative for the Indian share market. The so called foreign institutional investor giants will sell their stakes and leave the country.
5, Due to the aforesaid factors Indian growth rate will be diminished. Industrial growth will head southwards.
6, Tourist inflow will decrease. Not good for the travel and hospitality industry.
7, During the last recession in 2008, Indian rupee touched 51 against US dollar. Many IT professionals lost their jobs. We can expect a replica of this situation again.

What will happen in Kerala
1, Kerala is home for the largest expatriate population among other states in India. Hence recession anywhere in this globe is negative for kerala economy. Also it will affect the tourism and hospitality industry in the state.
2, It is said that kerala’s real estate sector has been in recession for long. Recession will dampen the prospects of this sector.
3, Sometimes recession is a boon for the small traders. Because when recession comes people prefer small shops than big malls.
4, So many people in the gulf region will lose their jobs. But the state is not equipped to meet these kinds of challenges.

After the global financial crisis now it is the turn of Goldman Sachs. Goldman Sachs is the major financial services company in the world. But the common people in US do not like the company (I came to know about this from Michael Moore’s documentary ‘Capitalism: A love story’). During the days of recession the senators in the US congress also blamed Goldman Sachs.  A minority called US congress as the director board of Goldman Sachs. It is evident that big companies play a very big role in the US in it’s day to day politics. Some former treasury secretaries were ex-employees of this global major. Recent fraud charges in a way will make someone happy for sure.
US securities and Exchange commission (SEC) sued Goldman Sachs for giving improper facts. The 141 year old financial services major denied it. In it’s official statement in the website the company says they had lost $90 million in that particular deal. They reiterated that their products are not designed to make losses for the investors. But the heat is on and the global indices are tanked heavily.
Two things are clear now. One, something is fishing some where. Two, the very incident questions the credibility of the financial institutions across the globe. Stocks and commodities prices plunged after the news. Normal investors are panic now. In India also sell off happened. Goldman Sachs is facing probes in U.K and Germany. German chancellor herself made statement against the company.
Goldman has investments in almost all the major economies. It is obvious that the impact of the news will be much bigger than it is expected to have. In India alone it has investment worth Rs.2000Cr, and has stakes in 27 Indian companies. After the global financial crisis Goldman Sachs crisis will be the major one. This crisis points out the need for proper reforms in the financial services sector. Something should be done to control the panic investors, if not, another major crisis is awaiting!!!

Some facts about Goldman Sachs (Source Wikipedia)
Type                Public (NYSE: GS)
Industry        Financial Services
Founded        1869
Founder(s)    Marcus Goldman
Headquarters     New York City
Area served     Worldwide
Key people       Lloyd C. Blankfein (Chairman) & (CEO)
Products :    Investment banking, Prime brokerage, Investment management
Commercial banking, Commodities
Revenue                        US$ 45.173 billion (2009)
Operating income     US$ 2.34 billion (2008)[dated info]
Net income                    US$ 13.39 billion (2009)
Total assets                   US$ 849 billion (2009)
Total equity                    US$ 64.369 billion (2008)
Employees                         32,500 (December 2009)
Website                            GS.com

In a study done by London business school it is found out that Sweden is the most innovative driven economy in the world. Sweden has ousted US from the throne. The top five economies are  Sweden, Japan,US, Finland and Singapore. Countries are selected in terms of technological skills and usage of communication technology. The study observed that Sweden has got the “finest distribution” system and also “excellent internal and external communications”. It has also got a very good skilled labor force too. The study also took into consideration the work done in order to overcome the recent financial meltdown.
Japan ranks second in the list. Japan showed an extra ordinary recovery over a span of 65 years. Mainly because of the upper hand in technology. On a purchasing power parity (PPP) basis Japan is the third largest economy in the world after US and China. Their fiscal deficit and the aging population are the  major worries of this nation.
The US is the most technologically powerful economy in the world, the study realized. Almost all the technological developments happen in US for the first time. They are at their summit of communication revolution. But the recent global financial meltdown left some blow on the US economy. The rescue package proved to be very helpful but  the US lost it’s first place as the most innovative economy around the globe.
London business school survey called Finland and Singapore as decent economies. They are the most correction free economies around the globe. Finland and it’s service brand Nokia took the communication revolution to next level at least in third world countries. The per capita income of Finland at par with France,Germany and Italy. Which makes the economy much stronger. Both Finland and Singapore are best examples of free market economy. Singapore GDP growth rate was 7 percent upto 2007, but due to recession 2008 growth figure came down to 1.2 percent.

In the union budget there was some hike in the personal income tax limit. This proposal came at a time when global recession showed withdrawal syndrome. It is a simple logic that when the people in a country spends then only the economy of the country booms, we can’t always look overseas for development. Which was evident during the time of global recession. China practiced the logic much before. In the global scenario also India is a major market with 1.15 billion people living here. All major global players in the market are now keen in opening branches in this country. As it is a truth all over the world india is a major service hub too (this proves that the salary given in india is cheap that’s why all jobs are imported to india). Since the salary in India is very low considering global standards the income tax limit should also be in a rational way. The new tax code serves very well in this regard.
Draft direct tax code had been made public. Now it is left for debate and is proposed to implement in 2011. That means it will get almost 2 years to debate the new tax code. The highlight of the new tax code is the widening of tax  limit. According to last general budget upto 1.6lakhs income will attract nil tax, for women the limit is 1.90lakhs and for senior citizens the limit is 2.40 lakhs. As it is a fact higher limit means higher spending by individuals. This in net effect will make positive impact in the economy. In the proposed new tax code income in the range 1.6-10 lakhs will only attract 10% tax only. The next slab is 10-25 lakhs which will attract a tax of 20% and above 25 lakhs the percentage is 30%. If these proposals are implemented there will be a large amount of money flow in the system.
Apart from these innovative steps savings limits will be increased form existing 1lakh to 3 lakhs. MAT (minimum alternate tax-tax payable to companies which are out of tax bracket) will be final tax and no carry over complication. STT, securities transaction tax-to eliminate from April 1, 2011. GST (goods and services tax) will be implemented from next financial year.It is believed that GST is a modern tax system which addresses all modern day tax issues.

Is it good
The new tax code is good to some extent. It will enable individuals to flow money to the market. The draft also proposes a reduction of 5% in corporate tax. The government is very sure that there will not be any loss in the revenue. Moreover it will bring transparency and simplicity to the system. The existing income tax law, 1961 will be replaced by the new law and India will reach in the 21st century taxation with the implementation of the same. Government plans to implement the tax tax law at the golden jubilee year of the existing tax law.
More aggressive debate is needed in this regard. If more simplicity is needed it should be done. Awareness in this regard should be done in a proper manner. Grass root level awareness is also required. If it is found out that the new system will cut governments revenue it should not impose new taxes on the people it should consider alternate measures to address the problem.