During the beginning of my career, I was working on Wall Street during the 2008 Financial Crisis. This is NOT a repeat of the 2008 Financial Crisis.
It may be sexy to scare people with that analogy to 2008 but it’s not accurate. And here’s why:
2008 was a financial crisis borne of years, decades of mistakes and misdeeds in the financial system such that byproducts of the housing bubble had infected every corner of the economy. When it all collapsed, the banks were frozen.
What’s happening now is a scary and tragic health crisis. To combat this crisis and save lives, we are TEMPORARILY and in solidarity entering quarantine. This will cause a temporary decline in goods and services being purchased.
In contrast to 2008 when the basic plumbing of our economy was rotted and rusted, now we are tackling a temporary decline in demand by us consumers to buy things. That decline will pressure businesses and jobs – UNTIL the health threat passes
When this health threat passes (praying so with as few lives lost as possible!) then demand by us for goods, services will return, likely greater than before due to pent up demand. All very different (and much easier for recovery) than 2008.
Originally posted on Twitter. Re-posted with permission.
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