noun a recurring cycle of events that result in a worsening situation
Describes a scenario where a series of events reinforce each other, leading to a downward spiral in financial markets.
Refers to a situation where a financial crisis leads to a negative feedback loop, exacerbating the crisis.
Describes a situation where a bank's financial instability leads to further problems, creating a loop of worsening conditions.
Identifies a situation where risks feed into each other, creating a self-reinforcing cycle of negative outcomes.
Refers to a scenario where policy decisions or actions have unintended consequences that worsen the initial problem.
In the financial sector, writers may use the term 'doom loop' to describe a situation where weak banks and weak governments feed off each other's weaknesses, creating a downward spiral of financial instability.
Psychologists may use the term 'doom loop' to refer to a pattern of negative thinking and behavior that reinforces itself, leading to feelings of hopelessness and despair.
Economists often use the term 'doom loop' to describe a situation where a country's high levels of debt lead to higher borrowing costs, which in turn make it harder to reduce the debt burden, creating a vicious cycle of economic decline.
Risk analysts may use the term 'doom loop' to describe a scenario where a series of interconnected risks amplify each other, leading to a cascading series of negative events that can have severe consequences for a company or financial institution.