thumb|350px|U.S. Treasury interest rates 3 month through 30 year bonds. [[Inverted yield curve|Inverted yields in early 2001.
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thumb|350px|right|[[United States Treasury security|Treasury yield spreads go inverted for an Inverted yield curve in early 2001
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The early 2000s recession was a major decline in economic activity which mainly occurred in developed countries. The recession affected the European Union during 2000 and 2001 and the United States from March to November 2001. The United Kingdom, Canada and Australia avoided the recession, while Russia, a nation that did not experience prosperity during the 1990s, began to recover from it. Japan's 1990s recession continued. A combination of the Dot Com bubble collapse and the September 11 attacks lengthed and worsened the recession.
This recession was predicted by economists because the boom of the 1990s, accompanied by both low inflation and low unemployment, slowed in some parts of East Asia during the 1997 Asian financial crisis. The recession in industrialized countries was not as significant as either of the two previous worldwide recessions. Some economists in the United States object to characterizing it as a recession since there were no two consecutive quarters of negative growth.
United States
GDP growth of the US from 2000–2002. Note the lack of two consecutive negative quarters. The profile matches that of a [[recession shapes|U shaped recession with growth remaining weak from 2000-III to 2003-I.<br />
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thumb|The U.S. unemployment rate between 1988 and 2011
After the relatively mild 1990 recession ended in early 1991, the country hit a belated unemployment rate peak of 7.8% in mid-1992. Job growth was initially muted by large layoffs among defense related industries. However, payrolls accelerated in 1992 and experienced robust growth through 2000.
Predictions that the bubble would burst emerged during the dot-com bubble in the late 1990s. Predictions about a future burst increased following the October 27, 1997, mini-crash, in the wake of the 1997 Asian financial crisis. This caused an uncertain economic climate during the first few months of 1998. However conditions improved, and the Federal Reserve raised interest rates six times between June 1999 and May 2000 in an effort to cool the economy to achieve a soft landing. The burst of the stock market bubble occurred in the form of the NASDAQ crash in March 2000. Growth in gross domestic product slowed considerably in the third quarter of 2000 to the lowest rate since a contraction in the first quarter of 1992.
According to the National Bureau of Economic Research (NBER), which is the private, nonprofit, nonpartisan organization charged with determining economic recessions, the U.S. economy was in recession from March 2001 to November 2001, a period of eight months at the beginning of President George W. Bush's term of office. The NBER's Business Cycle Dating Committee determined that a peak in business activity occurred in the U.S. economy in March 2001. A peak marks the end of an expansion and the beginning of a recession. The determination of a peak date in March is thus a determination that the expansion that began in March 1991 ended in March 2001 and a recession began.
However, economic conditions did not satisfy the common shorthand definition of recession, which is "a fall of a country's real gross domestic product in two or more successive quarters", and has led to some confusion about the procedure for determining the starting and ending dates of a recession.
The NBER's Business Cycle Dating Committee (BCDC) uses monthly, rather than quarterly, indicators to determine peaks and troughs in business activity, as can be seen by noting that starting and ending dates are given by month and year, not quarters. However, controversy over the precise dates of the recession led to the characterization of the recession as the "Clinton Recession" by Republicans, who asserted that it could be traced to the final term of President Bill Clinton. BCDC members suggested they would be open to revisiting the dates of the recession as newer and more definitive data became available. In early 2004, NBER President Martin Feldstein said: