2 ms·

I'd caution away from comparing the current recession to 2008. There the problem was truly unsustainable economic activity in the runup expansionary phase. Con

I'd caution away from comparing the current recession to 2008. There the problem was truly unsustainable economic activity in the runup expansionary phase. Consumer spending was powered by sub-prime mortgages that let people use hyperbolic housing prices as an ATM. Investment was juiced by an unsustainable expansion in residential construction. The financial markets created a flood of illusory wealth based off credit models that were never tested in production. Even after the initial financial crisis subsided, there was no way to turn the clock back to 2007. You couldn't just go back to AAA-rated CDOs built on NINJA loans to let people speculate on McMansions. This crisis is very different. Quarantine may last a long time, but eventually it will be over. There's no ostensible reason we can't go back to status quo ante bellum. There was nothing grossly unsustainable about the way the economy was operating in 2019. And once the virus threat is gone, we can just go back to the same economic patterns we were engaged in before the crisis.

icedchai 7y ago
Even after quarantine is over, it will be a slow ramp for many sectors. Small (hopefully very small) outbreaks will continue to occur, so people will be afraid. Restaurants will be less than a third full. Nobody will want to go to the movies. Crowds will be avoided.
- dcolkitt 7y ago
  I doubt people alter their behavior for long. Certainly not more than 6 months after the crest is over. The 1957 flu pandemic killed 100,000 Americans, which adjusted for population is where current models estimate Covid will land. And it had virtually zero lasting impact on culture of behavior.
  - elliekelly 7y ago
    Were people in 1957 forced to alter their behavior so significantly? I’ve been spending $5+/day at starbucks every single day for the last 15 years. I’d often go morning and afternoon. Lately I’ve had to make my coffee at home. The first week or so sucked. The baristas did a much better job. But I had to make it work so I’d tweak things here and there until I got it right. Now I can pretty much make the same drink I was buying. It’s much faster and much cheaper. I don’t see myself going back to starbucks nearly as frequently as I used to when this is over.
    - icedchai 7y ago
      Same here, except I'm using a Keurig machine now. Not great, but good enough. Starbucks drive thru is open, but I'm not waiting in a line for 20 minutes. It's not worth the time or the risk. Maybe I only do Starbucks 2x a week when things go back to normal. In general, I'm eating less crap, exercising more, lost about 8 pounds so far. I'm physically healthier than a month ago. Mentally, that's a different story...
    - avgDev 7y ago
      I bought an espresso machine right before shit hit the fan, it was $500. I can make a latte as good as starbucks and I'm more consistent. I had it for about 3 months, I wfh at least part of the week but now 100% remote and make at least 1-2 lattes a day. 30x3x5 = $450 this is just at one latte a day.
  - jshevek 7y ago
    I think you are most likely correct, but to argue devil's advocate there has been a significant change the way our society collectively discusses and reasons about these events, and a change in our views of acceptable losses.

icedchai 7y ago

Even after quarantine is over, it will be a slow ramp for many sectors. Small (hopefully very small) outbreaks will continue to occur, so people will be afraid. Restaurants will be less than a third full. Nobody will want to go to the movies. Crowds will be avoided.

dcolkitt 7y ago
I doubt people alter their behavior for long. Certainly not more than 6 months after the crest is over. The 1957 flu pandemic killed 100,000 Americans, which adjusted for population is where current models estimate Covid will land. And it had virtually zero lasting impact on culture of behavior.
- elliekelly 7y ago
  Were people in 1957 forced to alter their behavior so significantly? I’ve been spending $5+/day at starbucks every single day for the last 15 years. I’d often go morning and afternoon. Lately I’ve had to make my coffee at home. The first week or so sucked. The baristas did a much better job. But I had to make it work so I’d tweak things here and there until I got it right. Now I can pretty much make the same drink I was buying. It’s much faster and much cheaper. I don’t see myself going back to starbucks nearly as frequently as I used to when this is over.
  - icedchai 7y ago
    Same here, except I'm using a Keurig machine now. Not great, but good enough. Starbucks drive thru is open, but I'm not waiting in a line for 20 minutes. It's not worth the time or the risk. Maybe I only do Starbucks 2x a week when things go back to normal. In general, I'm eating less crap, exercising more, lost about 8 pounds so far. I'm physically healthier than a month ago. Mentally, that's a different story...
  - avgDev 7y ago
    I bought an espresso machine right before shit hit the fan, it was $500. I can make a latte as good as starbucks and I'm more consistent. I had it for about 3 months, I wfh at least part of the week but now 100% remote and make at least 1-2 lattes a day. 30x3x5 = $450 this is just at one latte a day.
- jshevek 7y ago
  I think you are most likely correct, but to argue devil's advocate there has been a significant change the way our society collectively discusses and reasons about these events, and a change in our views of acceptable losses.