Are we heading into a Global Great Depression?

[missy]

Or “just” a global recession?

Why the Global Recession Could Last a Long Time (Published 2020)

Fears are growing that the worldwide economic downturn could be especially deep and lengthy, with recovery limited by continued anxiety.

www.nytimes.com

Could coronavirus trigger a new Great Depression? Economists say it’s improbable — but not impossible

The coronavirus could herald a sea change in how Americans spend, save and invest their money — changes that could reverberate for decades.

www.nbcnews.com

U.S. economy is in a 'medically induced coma,' but that doesn't mean we're heading into a depression just yet

The dramatic economic slowdown caused by coronavirus has led many experts to predict that the U.S. will enter a recession this year. Some are even fearful we could enter a depression. But is this just hyperbole, or is the U.S. economy truly in deep trouble?

www.cnbc.com

Will the worst downturn since the Great Depression last as long?

There’s no guarantee of a rapid recovery.

www.vox.com

 

[Karl_K]

The world will never be the same that is for sure.
Too early to tell how it will go.

 

[redwood66]

I don't know but it is going to be awful for everyone.

 

[whitewave]

Sometimes I think yes and sometimes I think no, but like @Karl_K said it’s probably too early to tell.

Surely something not desirable will happen.

 

[MRBXXXFVVS1]

What's interesting is the recent recovery of the stock market. I think COVID-19 has affected small and medium sized businesses more than S&P 500 companies.

 

[Queenie60]

What's interesting is the recent recovery of the stock market. I think COVID-19 has affected small and medium sized businesses more than S&P 500 companies.

I agree however, once Q1 earnings are reported, this could take a different turn. Hope for the best for all.

 

[Karl_K]

The real scary thing is that anyone who is working from home that means that someone across the world who will work for a lower wage can in many cases do the job unless its a highly tenchical job that requires specialized knowledge and even then many people have been forced to train their replacements.

 

[jordyonbass]

What's interesting is the recent recovery of the stock market. I think COVID-19 has affected small and medium sized businesses more than S&P 500 companies.

Agreed. Tech businesses seem to be thriving as well since everyone is at home and using their services, yet my small Opal home business and my Land Surveying gig have both taken major hits from everything happening.

I'm wondering if the money is still flowing within economies, it's just shifted for now. If that's the case we may be able to avoid recession, but I also feel civil unrest will be an issue. I've already seen some people describing essential workers as the new bourgeoisie and that is a big concern for me.

 

[Daisys and Diamonds]

i think its sad bussoness don't have reserve in the bank to get them through 4 or 6 weeks shut
the govt are paying $500 a weak towards wages per person - they just need to pay rent and bills due

its a lesson in don't over extend yourself

 

[missy]

i think its sad bussoness don't have reserve in the bank to get them through 4 or 6 weeks shut
the govt are paying $500 a weak towards wages per person - they just need to pay rent and bills due

its a lesson in don't over extend yourself

Don't beat yourself up Daisy. Yes we should be careful not to live outside our means but something like this one cannot predict and depending how long this goes on and the economic repercussions one might not have been able to sufficiently save enough not to endure any hardships.

Moving forward it is a valuable lesson but don't beat yourself up for things that already happened. Instead just do better next time and one day at a time. None of us know what is going to happen of course and we have to hope for the best while doing our best.

Sending you (((hugs))).

 

[missy]

I agree however, once Q1 earnings are reported, this could take a different turn. Hope for the best for all.

Not to be a negative Nellie but I would not be surprised if we head into a Global Depression. I agree what the stock market is showing now has no bearing on what it will do in the future. The future is quite uncertain. I am hoping for the best but expecting the worst. And of course hope and pray I am proven wrong.

 

[Dancing Fire]

Not to be a negative Nellie but I would not be surprised if we head into a Global Depression. I agree what the stock market is showing now has no bearing on what it will do in the future. The future is quite uncertain. I am hoping for the best but expecting the worst. And of course hope and pray I am proven wrong.

One thing is certain...The longer the lockdown the worst it'll be for small businesses. As more and more small businesses close up shop millions of jobs will be lost.

 

[arkieb1]

A recession yes, a depression probably not, this thing would have to last 2+ years or more IMHO for that.... and as soon as it's over global economies will bounce back. Yes some companies will never recover that is true but there will be jobs and spending once again when the world gets over it.

 

[GliderPoss]

Yeah I think more likely a recession especially as some countries are looking to “reopen” already and quickly get back to normal (if possible). Stock market has always bounced back and will again. Suspect unemployed will rise significantly as will taxes to cover the government bail out spending. All margins & profits will be affected as everything shifts throughout the year - Oz Federal Budget is delayed until October (usually May) so this will have a big impact on business too.

 

[Garry H (Cut Nut)]

World wise I think we will be closer to 1930 than 1990 or 2008 after a year. Small businesses with little cushion will fall like flies.
Big retail and many companies will go online and downsize their work forces.
Governments will get bigger and more 1984ish.
They will rip disposable cash from wallets reducing spending = recession without the unemployment.
The un and under employment = DEPRESSION

 

[mellowyellowgirl]

A recession yes, a depression probably not, this thing would have to last 2+ years or more IMHO for that.... and as soon as it's over global economies will bounce back. Yes some companies will never recover that is true but there will be jobs and spending once again when the world gets over it.

Can I just say I find you very soothing.

It's so weird since I don't know anything about you but there must be something about your personality and hence posts that is calming on my rankled soul.

 

[arkieb1]

Can I just say I find you very soothing.

It's so weird since I don't know anything about you but there must be something about your personality and hence posts that is calming on my rankled soul.

I'm an Aussie just like you are, which means we are probably more chilled out about everything than other places.....

Plus I did 3 Unit economics at school we have a totally different set of economic conditions leading into and during this than back when the actual depression occurred. It will depend on how long it takes to find a cure IMHO, the longer that takes the more likely we slide into a depression, but I think in theory a cure should be found even if it takes 12 to 18 months before that occurs, but, we should come out of this with employment picking up and spending picking up again.

 

[Garry H (Cut Nut)]

I'm an Aussie just like you are, which means we are probably more chilled out about everything than other places.....

Plus I did 3 Unit economics at school we have a totally different set of economic conditions leading into and during this than back when the actual depression occurred. It will depend on how long it takes to find a cure IMHO, the longer that takes the more likely we slide into a depression, but I think in theory a cure should be found even if it takes 12 to 18 months before that occurs, but, we should come out of this with employment picking up and spending picking up again.

Hope you are right. And hope we can get back gradually to normal in Oz asap (in stages) with no second wave.

 

[Dancing Fire]

but I think in theory a cure should be found even if it takes 12 to 18 months before that occurs, but, we should come out of this with employment picking up and spending picking up again.

So we should stay home for another yr?

 

[yssie]

I was up much too late last night watching clips from PM Ardern's various live COVID-19 responses. She did one Q&A in a not-exactly-flattering green sweatshirt.

She commands sensibility, she compels empathy, and her country adores her. And I spent the whole time thinking "Why couldn't the US have voted in someone like her?"


Well, aside from that aside... The anchors of the US economy are those dratted Big Blues that McConnell would rather see bankrupt than "bailed out". So unless Kentucky et al. are planning to ramp up production in... Wait, what exactly does Kentucky contribute to our GDP? - It's only a matter of time before the federal handouts that half the country - including Kentucky, oh dear - has come to rely on are depleted.

And if the USA falls, yes, I do believe the rest of the world will come tumbling down soon thereafter.

 

[Garry H (Cut Nut)]

I was up much too late last night watching clips from PM Ardern's various live COVID-19 responses. She did one Q&A in a not-exactly-flattering green sweatshirt.

She commands sensibility, she compels empathy, and her country adores her. And I spent the whole time thinking "Why couldn't the US have voted in someone like her?"


Well, aside from that aside... The anchors of the US economy are those dratted Big Blues that McConnell would rather see bankrupt than "bailed out". So unless Kentucky et al. are planning to ramp up production in... Wait, what exactly does Kentucky contribute to our GDP? - It's only a matter of time before the federal handouts that half the country - including Kentucky, oh dear - has come to rely on are depleted.

And if the USA falls, yes, I do believe the rest of the world will come tumbling down soon thereafter.

She was loosing badly in the polls 1 month ago

 

[MRBXXXFVVS1]

The other thing to consider is that consumer behavior has changed as a result of coronavirus. More people are saving money due to fear of job/economic instability, not having opportunity to spend, and lack of desire for discretionary spending given a shift in priorities. I wonder how much people will revert to pre-COVID-19 spending, or if this pandemic will have a lasting shift on consumer spending and behavior?

Interestingly, Fidelity and Vanguard shared that most investors stayed invested during the downturn, and some are even continuing to put money in the market.

 

[TechieTechie]

From what I've been told and have read, we'll have jobless numbers similar to the great depression, but it should (hopefully) be short lived, 18 months at the outside. But, that spending habits for a generation may be changed. I hope so, way too many people live beyond their means (including myself in my early years).

Jobless Rates
Monetary Policy moves that may stave off a depression
What CFOs think....a survey
A global CFO Survey

 

[arkieb1]

So we should stay home for another yr?

Depends on how old and how vulnerable you are. What most countries are going to do IMHO is loosen restrictions until the numbers go up then tighten them again and so on so there will be waves of infection and changing regulations, and yes that might go on for a year or more.... Unless of course they go with the herd theory then you just let everyone get it and if you die then you are simply collateral damage.