This paper will analyze articles that relate to the recession, GDP, inflation, unemployment, derived demand, and housing starts. These analyses are related to the current situation of the US economy. According to Mankiw’s textbook, a recession is defined as a phase of negative GDP growth usually within two consecutive quarters. During this time the GDP growth expressed as a percentage is usually negative. Mankiw’s textbook states that a recession is caused by a shift in the aggregate demand curve. When there is a fall in general demand, firms are forced to reduce their operations and at times even close down the business. This leads to inefficiency in the economy. The problem is cyclical in that unemployment means that households have less disposable income hence the aggregate demand in an economy remains low. Governments are faced with the obligation of fighting both the possibilities of a recession and ensuring that there are enough employment opportunities for the people. In article # 5, Uchitelle states that 524,000 jobs were lost in December alone when there was still uncertainty over the status of the US economy in terms of being in a recession or not. In January this year, article # 1 Dougherty reports that another 600, 000 were lost. This indicates the fact that firms are scaling down their operations to cut down costs as a result of a decrease in demand. Mankiw textbook states that a shock in the aggregate demand is usually triggered by an unprecedented negative occurrence on the supply side. The majority of Americans believe that the current recession was triggered by the 2008 global hike in energy prices while economic analysts believe it is a culmination of a long period of poor regulation of the financial market. Due to a recession, there will be a negative response on aggregate demand that might be caused by several factors. Article # summarizes them as:  1. Shortage of finance  2. Falling house prices – shortage of mortgages and finance.  3. Cost-push inflation decreasing income and reducing disposable income.  4. Lower confidence in the finance sector. For example, some bank has already closed down (causes of recession, 2009). Therefore, those four factors have impacted negatively aggregate demand (AD) which is constructed of consumption by households, investment, government spending, and exports fewer imports and thus a change in any of its components means that it shifts. In figure 1, it is indicated by the shift of AD1 to AD2, and GDP will consequently fall from G1 to G2 The slope of AS determines the change in G. If there is a fall in AD represented by a shift, then there will be a fall in Real GDP. If there is a vertical AS curve, AS curve means that the economy is operating at full capacity and 100% utilization of all resources. Thus, a change in demand would only mean a slight change in real GDP. This should be the trend that the US economy expected, a change in AD would only mean a slight change in real GDP, but this has not become the trend yet. A fall in Real GDP will be temporary as labor markets will tend to adjust to new price levels in a short period. In article # 5, Uchitelle says that 2.59 million jobs have been lost so far. However, the Wall Street Journal, in article # 1 (Dougherty, 200