In today’s video, I want to talk about an economic recession and a possible economic depression.
We’re going to take a look at how this can snowball into major problems for the economy — affecting you, your job and what’s to come in the future.
With the coronavirus, there’s a lot of shutdowns — government shutdowns, border shutdowns — there’s a lot of issues going underneath the country and underneath the world. Many countries can’t even operate.
What’s happening right now is more than likely, we are already in a recession.
You don’t really know you’re in a recession until usually six months later because you can’t see the numbers till they’ve actually happened.
What’s the big difference between RECESSION and DEPRESSION?
When at a long-term recession and you don’t have income and employment, you really get into a depression.
A recession is just a really, really, really long time where people aren’t making money.
If you take a look at everything going on right now
Jobless claims jumped by 70,000 as virus starts to take hold.
I’ll tell you, as I went in to take a look at my son’s school over there, those people are applying for new jobs.
At the daycare, the same thing, people are applying for new jobs. They’re trying to get a job as quickly as possible.
The restaurant workers are being shut down in multiple states.
As that happens, what would the people that are making money from wages and tips from restaurants going to do?
That’s about three million people out of work.
In either case, with those jobless claims spiking — we’ve had a 629,000 just this week in 15 states.
You compare this with 2008-2009, we are nearly at that same peak and level.
And that’s just the beginning — that’s just the first spike right.
Eventually, this will continue to creep up.
If you look at California 190,000 claims just this week, 78,000 in Ohio, 50,000 in Minnesota here and this will probably continue to ramp up.
How does this really work and function?
Let’s check out this snowball effect and how this really works out.
What the government did, which you know, they’re looking out for people’s — but what they did was they shut down the restaurants.
As they shut this down, that means no work for probably half that workforce and many of those businesses will shut down.
Now, you’ve got this waiter or waitress or bartender that has no job. When you have no job, you can’t pay rent. And when you can’t pay rent, now the landlord has no money either.
So, they have to probably file for bankruptcy eventually as well.
This continues to spiral — as a snowball effect. It keeps going and it continues to accelerate.
The waiter is not going to get paid. The business owner of that restaurant isn’t going to be making money, so he won’t be spending money.
Basically, everything just slows down in a big way.
When you have less money, you can’t pay your waitstaff.
When your waitstaff has no money, they can’t pay their rent the landlord.
Then won’t be getting paid. Then the bank won’t be getting their money.
Anyways, long story short, what I’m saying is that we’re heading into some serious times. If you think we’re just going to be doing a shutdown for two weeks — think again.
Because what typically governments do and I’ve seen this in the Russian era, they’ll test you first. They’ll do a one week, two weeks shutdown. Then they’ll just do restaurants. Then they limit hours on stores. Then they’ll limit even more further, limit to store hours more. They’ll shut down gas stations to maybe only truckers, you won’t be able to go anywhere.
They’ll take it a step further — will shut more and more and more things down.
Two weeks turns into for four weeks turns into eight.
This is the way the world works, when you’re being controlled by the government.
This is what’s going to end up happening.
As far as things economically goes and your personal finance and your money, be prepared. Especially if you have a job that depends on a physical location and you’re not working online or you don’t have money saved up — this could be a serious issue and a problem for quite a while.
Get ready, knuckle down, and stay smart.