UK Accounting Glossary
A depressed market occurs when supply overtakes demand, resulting in weak and lower prices.
The depressed market has more sellers than buyers and is often referred to as a “buyer’s market.” Although some companies struggle in a depressed market, many blue chips companies do remarkably well under depressive and volatile market conditions. There are many reasons for a dressed market to occur. For example, a depressed market might be brought about by war or environmental disasters. A depressed market often sees a high number of bankruptcies, foreclosures and increased unemployment. Recovery in a depressed market is generally slow, with the return of economic confidence dependant on new market development, exhaustion of existing supplies and government actions to spur spending in the depressed market. Today, a depressed market has a tendency to spread worldwide because of international trade and credit. A recession is often a sign of a future depressed market.
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This glossary post was last updated: 9th February 2020.