Editing Recession (section)

===Paradoxes of thrift and deleveraging===

Behavior that may be optimal for an individual (e.g., saving more during adverse economic conditions) can be detrimental if too many individuals pursue the same behavior, as ultimately, one person's consumption is another person's income. Too many consumers attempting to save (or pay down debt) simultaneously is called the [[paradox of thrift]]<ref name="LipseyHarbury1992">{{cite book |last1=Lipsey |first1=Richard G. |last2=Harbury |first2=Colin |title=First Principles of Economics |year=1992 |publisher=Oxford University Press |isbn=978-0-297-82120-5 |page=294 |url=https://books.google.com/books?id=cV0EZuJxod8C&pg=PA294}}</ref> and can cause or deepen a recession. Economist [[Hyman Minsky]] also described a "paradox of deleveraging" as financial institutions that have too much leverage (debt relative to equity) cannot all de-leverage simultaneously without significant declines in the value of their assets.<ref name="Yellen on Minsky">{{cite web|url=https://www.frbsf.org/our-district/press/presidents-speeches/yellen-speeches/2009/april/yellen-minsky-meltdown-central-bankers/|title=A Minsky Meltdown: Lessons for Central Bankers|website=Federal Reserve Bank of San Francisco speeches|date=16 April 2009|access-date=4 June 2019|archive-date=5 January 2013|archive-url=https://web.archive.org/web/20130105104826/http://www.frbsf.org/news/speeches/2009/0416.html|url-status=live}}</ref>