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The current recession (which we are undoubtedly technically in) is mainly due to governments everywhere mandating that the economy go into recession due to a pu

The current recession (which we are undoubtedly technically in) is mainly due to governments everywhere mandating that the economy go into recession due to a public health emergency. Once that's done, business will almost certainly bounce back. Of course the economy is in a recession when all world governments have essentially mandated that it do so.

dgritsko 7y ago
Is that entirely true, though? At least some folks are losing their jobs, and at least some businesses are not able remain solvent. The effects from these events can't simply be reverted once the emergency is "done" (if we can even hope to be able to use the term "done" at some point), and it seems like they will almost certainly have at least some long-term negative impact. "How much" and "how long" remains to be seen.
- tathougies 7y ago
  Given that the government is being generous with a stimulus, and that most banks will see the writing on the wall which is that these businesses are not insolvent due to lack of demand, but rather the fact that demand was legislated away, only to be reintroduced in (hopefully) a few months), most banks and financial institutions will almost certainly salivate at the thought of almost guaranteed loan yields if they have the funds to wait it out. And banks of course certainly do have the funds to wait it out.
twomoretime 7y ago
>The current recession (which we are undoubtedly technically in) is mainly due to government's everywhere mandating... Unlikely. The writing has been on the wall for a while. The inverted yield curve and the long overdue 7 year cycle, among other indicators suggest that the virus was just a trigger. And we'll see it was a trigger for much more - the world has been an increasingly overstuffed powder keg for years. Do you know that Turkey and Greece are inching toward war over the refugee situation, and Greece already has support from multiple European Nations in shutting down migration? Imagine how many nations will be pulled in if one of the saber rattling incidents actually turns deadly... COVID-19 is the chaos that is about to shake loose every crack in the global socioeconomic system. Imagine how the geopolitical landscape is about to change when billions of Indians and Africans are exposed to the virus...
- tathougies 7y ago
  In terms of the broader economic picture, companies have more cash than ever. Just a few years ago, the new york times had an article decrying the situation and accusing companies of 'hoarding' cash. My how the times have changed: https://www.nytimes.com/2016/01/24/magazine/why-are-corporations-hoarding-trillions.html https://www.nytimes.com/2016/01/24/magazine/why-are-corporat...
stuff4ben 7y ago
I like how you put it "governments everywhere mandating that the economy go into recession due to a public health emergency". Which is very true. While yes the coronavirus is the initial cause, the fact remains that governments put the economy on hold, for the greater good of humanity. Which means that it should bounce back, hopefully quickly in my optimistic mind.
- tathougies 7y ago
  That's right. Most companies have not stopped business due to bodies lining the streets. If they had been forced to close due to the sheer reality of unconstrained growth, the recession would be terrible. However, right now, most countries are closing businesses preemptively, which is great, but if the government mandates a recession, they will be forced to compensate (which they're doing)
r00fus 7y ago
Yeah, everything will be back to normal - if you can weather the storm. The problem is that many small business can't/won't. How will government help them? Sounds like a perfect (horrible) storm.
- tathougies 7y ago
  Most governments have announced pretty generous packages to businesses

dgritsko 7y ago

Is that entirely true, though? At least some folks are losing their jobs, and at least some businesses are not able remain solvent. The effects from these events can't simply be reverted once the emergency is "done" (if we can even hope to be able to use the term "done" at some point), and it seems like they will almost certainly have at least some long-term negative impact. "How much" and "how long" remains to be seen.

tathougies 7y ago
Given that the government is being generous with a stimulus, and that most banks will see the writing on the wall which is that these businesses are not insolvent due to lack of demand, but rather the fact that demand was legislated away, only to be reintroduced in (hopefully) a few months), most banks and financial institutions will almost certainly salivate at the thought of almost guaranteed loan yields if they have the funds to wait it out. And banks of course certainly do have the funds to wait it out.

twomoretime 7y ago

>The current recession (which we are undoubtedly technically in) is mainly due to government's everywhere mandating... Unlikely. The writing has been on the wall for a while. The inverted yield curve and the long overdue 7 year cycle, among other indicators suggest that the virus was just a trigger. And we'll see it was a trigger for much more - the world has been an increasingly overstuffed powder keg for years. Do you know that Turkey and Greece are inching toward war over the refugee situation, and Greece already has support from multiple European Nations in shutting down migration? Imagine how many nations will be pulled in if one of the saber rattling incidents actually turns deadly... COVID-19 is the chaos that is about to shake loose every crack in the global socioeconomic system. Imagine how the geopolitical landscape is about to change when billions of Indians and Africans are exposed to the virus...

tathougies 7y ago
In terms of the broader economic picture, companies have more cash than ever. Just a few years ago, the new york times had an article decrying the situation and accusing companies of 'hoarding' cash. My how the times have changed: https://www.nytimes.com/2016/01/24/magazine/why-are-corporations-hoarding-trillions.html https://www.nytimes.com/2016/01/24/magazine/why-are-corporat...

stuff4ben 7y ago

I like how you put it "governments everywhere mandating that the economy go into recession due to a public health emergency". Which is very true. While yes the coronavirus is the initial cause, the fact remains that governments put the economy on hold, for the greater good of humanity. Which means that it should bounce back, hopefully quickly in my optimistic mind.

tathougies 7y ago
That's right. Most companies have not stopped business due to bodies lining the streets. If they had been forced to close due to the sheer reality of unconstrained growth, the recession would be terrible. However, right now, most countries are closing businesses preemptively, which is great, but if the government mandates a recession, they will be forced to compensate (which they're doing)

r00fus 7y ago

Yeah, everything will be back to normal - if you can weather the storm. The problem is that many small business can't/won't. How will government help them? Sounds like a perfect (horrible) storm.

tathougies 7y ago
Most governments have announced pretty generous packages to businesses