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Honestly, I don’t believe we will see a huge depression unless there is war. People are still available for work and all the equipment used for producing value

Honestly, I don’t believe we will see a huge depression unless there is war. People are still available for work and all the equipment used for producing value is in good conditions. So long as government provides fiscal stimulus, depression shouldn’t happen. In case it happens though, you are better of farming stuff like potatoes and chicken than developing software until government steps in with fiscal stimulus, though it will require some existing capital.

maxander 7y ago
In many cases, people aren't available; they're sheltering at home, social distancing. Even for those who can work remotely, the disruption to routine is going to reduce productivity. And worse, many assets are going to be destroyed- for instance, restaurants that go under while distancing is taking place are just going to be gone, and while the brute equipment can be reused later, the "organizational capital" (the habits and knowledge of how to run that particular business in that particular context most effectively) vanishes. Various governmental interventions (stimulus, rent freezes, etc) can ameliorate this, but I'm not confident (and the financial sector isn't confident, I think) that the government is presently competent enough to get too much mileage out of implementing these; stimulus needs to be done correctly and promptly to have much effect. If you're in (or your customers are in) an industry that can hunker down and "weather the downturn," the eventual return to normal will be priced in and you'll likely be fine. If you're in (or ditto) an industry that will suffer attrition, the uncertainty will be priced in and you're liable to suffer. Give some thought as to where you stand.
- fxtentacle 7y ago
  Restaurants won't have to go away if you freeze the rent and pay the previous employees a replacement income. In other words, providing a stimulus package paid to the right people can prevent it.
glouwbug 7y ago
We may be okay if COVID is our only real threat. Self isolation won't be impeded, and hospitals will not over saturate. If anything disturbs self isolation, like a massive earthquake, drought, Australian like fires, or like you say a war, there is no chance of a quick rebounding economy. That being said, as an aside, imagine slipping into a 3 month coma from a heavy Christmas 2019 party and waking up to eight other people on ventilators in your room. Imagine finding out Kobie Bryant died, that the USA assassinated a top Iranian military figure, and that the world economy dropped 35% in 1 month. You'd think there was a war.
- matt_the_bass 7y ago
  One fear I have is that the current US administration will bring one (a war) to us sooner rather than later.

maxander 7y ago

In many cases, people aren't available; they're sheltering at home, social distancing. Even for those who can work remotely, the disruption to routine is going to reduce productivity. And worse, many assets are going to be destroyed- for instance, restaurants that go under while distancing is taking place are just going to be gone, and while the brute equipment can be reused later, the "organizational capital" (the habits and knowledge of how to run that particular business in that particular context most effectively) vanishes. Various governmental interventions (stimulus, rent freezes, etc) can ameliorate this, but I'm not confident (and the financial sector isn't confident, I think) that the government is presently competent enough to get too much mileage out of implementing these; stimulus needs to be done correctly and promptly to have much effect. If you're in (or your customers are in) an industry that can hunker down and "weather the downturn," the eventual return to normal will be priced in and you'll likely be fine. If you're in (or ditto) an industry that will suffer attrition, the uncertainty will be priced in and you're liable to suffer. Give some thought as to where you stand.

fxtentacle 7y ago
Restaurants won't have to go away if you freeze the rent and pay the previous employees a replacement income. In other words, providing a stimulus package paid to the right people can prevent it.

glouwbug 7y ago

We may be okay if COVID is our only real threat. Self isolation won't be impeded, and hospitals will not over saturate. If anything disturbs self isolation, like a massive earthquake, drought, Australian like fires, or like you say a war, there is no chance of a quick rebounding economy. That being said, as an aside, imagine slipping into a 3 month coma from a heavy Christmas 2019 party and waking up to eight other people on ventilators in your room. Imagine finding out Kobie Bryant died, that the USA assassinated a top Iranian military figure, and that the world economy dropped 35% in 1 month. You'd think there was a war.

matt_the_bass 7y ago
One fear I have is that the current US administration will bring one (a war) to us sooner rather than later.