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The global economy is going through one of the biggest economic depression in history because of this global shutdown. The stock market crash has burned trillions of dollars in less than two months. The global GDP is already shrinking at rate never seen before and this is expected to continue for a foreseeable future as the global disruption worsens. The markets are crashing at a faster rate than what happened in the great depression and the black Monday in terms of percentage drawdown. The 2020 stock market crash will end up being the worst crash in history.
Experts are warning that the US GDP can decline by up to 14 percent and this is a decline that has never been seen before. For many years, the economy has been like a ponzi scheme and it looks as if everyone has forgotten all the lessons we learnt from the great depression. Since the 2008 stock market crash , we have had a fake economic growth. Transfer of assets like stocks and real estate does not contribute to real economic growth because this is already existing wealth that does not add anything to the real GDP. A time of reality has come and we all have to admit that the economic growth in the United States is inflated by dent and this is the time when we have to change our course. Real estate, stocks and other assets have inflated prices. The 2008 financial crisis taught us the value of inflated assets can fall to zero overnight when the housing market collapsed. This time round, the same has happened to the stock market and this shows us how unsustainable the economy is. The GDP numbers are always unrealistic and they don’t reflect the real economic growth in the US and the current economic meltdown is proving that our economic growth for the last 10 years is unrealistic because we have an inflated economy.
If this current global panic continues many businesses will go bankrupt and millions of Americans will lose their jobs. This looks like the begging and already many people have been laid off and about 25 percent of Americans workers have had their working hours reduced according to the poll that was done by the Survey USA.
This global crisis is threatening the economic well being of many nations. It is shocking that 1 out of every four Americans have had their working hours reduced. Things are changing really quickly because just a few months ago, Trump had created a robust economy where more than 160 million Americans were employed. The US economy is shrinking very fast and a recent Goldman Sachs’ report appears to confirm that the economy really looks ugly. Their report is based on the compilation of recent data being released by various US companies. We now have very high rates of layoffs and decline in consumer spending. These are early indicators that are showing the level of impact to the economy. It is not a surprise that jobless claims have been increasing across the country and economists are expecting that the jobless claims are expected to skyrocket by roughly 2.5 million in the next few weeks.
Right now we have a health crisis and an economic collapse at the same time. This puts the whole world at a very risky place because this economic meltdown can easily end up being a historic great depression just as it happened in 1929. The impact on the global economy is big and everyone fears that this economic collapse will worsen in the near future because of this disruption. Millions of people are losing their jobs across the board as companies go out of business because of this panic. In the near future, the markets will continue collapsing and this market crash will get worse and potentially culminate to the next great depression.
Read the full transcript here: https://www.epiceconomist.com
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