Will Corona Quarantine Cause A Depression?
These days the word depression has begun to appear in the news. Especially relevant? We’re talking about economic depression because business is pretty much shut down. Will the Corona Quarantine Cause Depression? Learn more in Will-Corona-Quarantine-Cause-Depression?-Bob Davis Podcast 913.
We’re in uncharted waters due to the pandemic. No nation has ever brought its economy to full stop in such a short period of time.
Biggest Reduction In Economic Growth Ever
Even more major banks are predicting at least a 25 percent reduction in US output in the first quarter.
Bigger Than The Great Depression
This is unprecedented even in the darkest days of the Great Depression back in the 1930’s.
What’s Done Is Done
While we can ask whether this was a good idea, what’s done is done.
Can We Hit Pause? Or will The Corona Quarantine Cause Depression?
Seems like people think you can ‘hit pause’. Come back in thirty, sixty, ninety or one hundred twenty days. Hit ‘play’ and everything will be fine.
But above all, this is real life. Even though it seems like we’re in a movie, we’re not.
We May Not Be Able To Easily Restart
Economies may not start easily once they are shut down. Moreover the central banks have been running very loose monetary policies for years. I’ve done a lot of podcasts about this. The central banks may not have much ammunition left. I’ll tell you what this means in Will-Corona-Quarantine-Cause-Depression?-Bob Davis Podcast 913.
What About Actions Government Has Taken?
As a result of ordered lock downs the government has taken action in the last week or so.
Interest Rates Slashed
The federal reserve slashed interest rates twice. The effective interest rate is now zero.
Another 2 Trillion of Relief On The Way
A 2 trillion dollar relief package is working its way through congress.
One Thousand Dollar Checks
We’re all supposed to get one thousand dollar a month checks as needed.
Why Are They Doing This?
Certainly there’s a reason for all of this. It has to do with what a depression is and what causes it. I’ll explain it in Will-Corona-Quarantine-Cause-Depression?-Bob Davis Podcast 913. Are we there yet? Time will tell.
Making It Better…Or Worse
Finally in the end economists and policy makers will sift through whatever wreckage is left and tell us whether the measures taken now made things better or worse.
Short Deep Recession or Depression
In conclusion whether we have a short and deep recession or a world wide economic disaster known as a depression depends on what our leaders do now.
Out of Our Hands
It sure seems to me like it’s out of our hands.
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Will-Corona-Quarantine-Cause-Depression?-Bob Davis Podcast 913
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