Where’s the money going during recessions?

Question

It vice versa where’s it coming from when the economy is booming?

When the economy is bad, it feels like there’s not enough money to go around, but when it’s good there’s plenty.

In: Economics

Answer 1

Think of GDP as total economic activity in a timeframe not total dollars in circulation at a given point in time. The same dollar can be used for many transactions, all of which add to GDP.