I have been keeping an eye on the events o the world, both the spread of the virus but also things on the economic front.
I will say that there is real reason to be concerned about the economic fallout of this pandemic and the necessary shutting down of large swaths of our economy.
The interruption of our regular routines is a very necessary thing in order to stop the spread of this virus which seems to prey on the weak and the vulnerable.
Nobody is expendable and there is no such thing as “acceptable losses” in order to get the economy going again.
I am concerned about the massive and mindboggling amount of currency that had been created in the last few weeks in order to stabilize the fragile economy.
There are also a number of businesses that will not survive this shutdown, and that is a sad and tragic thing.
The average person will end up getting through the other side of this pandemic with more debt than they had before, yet another regrettable outcome.
All of this adds up to a real chance of a massive depression coming out the other side of this pandemic.
The other fear is that as a result of all of that currency that was created, that hyperinflation will take hold and thus crash not just the economy but our currency and with it our banking system altogether: The Fiscal Apocalypse.
The one thing that I hold on to is the fact that as everyone is hold up in their homes, the one thing they all want to do is get back at it.
They all want to get back to work and yes, get back to spending. Since they will want to spend, there will be someone, some business, to step up to take their money.
That will spark the economic recovery. It may take time, but things will recover.
The other thing to consider is that while a great deal of cash was created, they did not hand it out to everyone, and those that they did give cash to, it was limited and spent immediately.
The average person does not have a massive store of cash to spend all at once. Also, for the most part, while people are worried, they are not fearful of imminent collapse of the fiscal system.
That means that people will work and spend, and yes save. I also hope that people will start to do something about their debt, as in work to eliminate it.
All in all, while there are a lot of things to be concerned about with regards to the future, after this pandemic passes (and it will), things will be fine.
The economy will recover; so no, this is not The Fiscal Apocalypse.
As always: Keep your head up, your attitude positive, and keep moving forward!