This is the first recession I can remember living through. I don't remember 2008 at all since I was a kid and NZ was barely affected by it.
This is a much worse recession than 2008, but in my day to day life, nothing has changed for me. Things feel exactly the same. The economy might have shrunk 20%, but life seems to still go on. Nothing has disappeared because of it. The things I know are still here, the surroundings I know have stayed mostly the same.
I've always had an expectation that the atmosphere and feeling in a recession would be different. Things feel absolutely normal for me. The only change has been on charts and paper. It hasn't made any difference to me if the economy was $300 billion or $250 billion now.
Reading back on the news on previous recessions, you get a feel of a dire situation. You read that buildings are boarded up. You read that there is a visible increase in homelessness. You read that kids go to school without shoes. You see people in destroyed attire. There is just supposed to be a general negative atmosphere in society. At least that is the impression I've had from reading the news previously. Currently I'm just not seeing any of that. That isn't to say that it isn't happening. It just doesn't seem widespread and/or a national catastrophe.
Am I just talking too soon or just naive? I just had a different expectation but things feel exactly the same to me.
You know why it's not really a recession? Because money was injected to unemployed households and the market didn't crash and wipe out investments and retirement funds. To be clear, the way you beat a recession is to spend your way out of it. Move money around. You don't put it under a mattress, bury it in the backyard, or stick it in a bank. You buy things, spend it.
And that's what people have been doing.
The recession hasn't hit yet, really. It will kind of hit about 3 weeks into August when the boosted unemployment income is gone and people realize that they have to sell off their assets and people have looming foreclosures. They'll stop spending then.
What we have right now is levels of unemployment about half of the depression.
So in one month, it's gonna suck a little. September is gonna get a little worse. November and December is gonna be harsh and will be marked by a lot of suicides. But unemployment won't spike much and we're not going to see a real recession and certainly not a depression.
We'll see lots of house foreclosures though.