No V-Shape Recovery, More like a Hockey Stick
Many economists were forecasting a V-shape recovery due to the coronavirus pandemic. I feel like these economists are listening to the Washington D.C. rosy outlook that we have enough testing to anyone who wants a test. Bull crap. The economy is not going to recover once we are starting phase one, phase two, phase three reopening. The recovery is going to be long and slow. I am not an economist. I am a consumer and a business owner that lives in the real world. During the 2008 financial meltdown, we lost 2.2 million jobs. During the pandemic, we lost 39 million jobs over the last ninety days. It took us almost ten years to recover from the 2008 crash. We make you think our economy will improve in the next 90 days. Anyone working stiff knows it is going to be a long, tough road. There are going to be lots of bankruptcies, home foreclosures, and slow consumer spending. Our economy based on consumers buying all kinds of crap they think they need. When you don't have enough money to pay for your groceries or medication, what do you think is going to happen? People are going to stop buying stuff on-line, stop going out to eat, and not purchase cars. What may happen is not rocket science. If you have to choose between toilet paper vs. a new watch from Amazon Prime. Guess the answer. Yes, Congress provides financial support, but it is forecasted to stop by August 2020. According to Moody Analytics, we may see employment improve during the summer months, but they expect the unemployment rate to remain in the 9% to 10% until early 2022. Unemployment may be higher as the flu season, and the coronavirus hits us in the 4th quarter of 2020. I hate to be a Debbie Downer, but the reality is that the recovery is going to be painful until our scientist develops a vaccine for the coronavirus, testing is available and contacts tracing. My recommendation to consumers who will have jobs is to reduce your debt and manage your expenses. My guess is the recovery is going to look like a hockey stick, not V-shape recovery.