I know, technically the Business Cycle Dating Committee of the National Bureau of Economic Research is the one to officially declare a recession, and they haven’t done so yet. So officially, no, we’re not actually in a recession. And in fact, I don’t think this point should be missed, because as is all too often forgotten, the details matter.
But for all those who say we’re not in a recession, you’re missing the point. If we’re not in a recession now, we’re about to be. And more importantly, everyone knows it.
Many companies are already acting like we’re in a recession. Look at all of these companies that have frozen hiring. They’re not waiting for some obscure committee to tell them what they already know. And it’s not just hiring that will slow down. I personally know of multiple large companies (ones every American household would know) that have slashed their budgets.
But all of this to say, now isn’t a time to get depressed or hunker down. Yes, it’s important to recognize the facts for what they are. You need a firm grasp of reality to know how to most efficiently and effectively navigate it. That is just the starting point however.
It’s in times of uncertainty and disruption that the most gains can be made. It will be interesting to see how companies navigate the next couple of years. How well were they prepared, but also what decisions do they make in the moment. What new players emerge. Does crypto survive.
More importantly, how will individuals weather the coming storm? How will the past two years of stimulus checks, no one working, crazy real estate markets, etc impact things?
I’m excited to dive into all of this.
I’ll close by making a couple points.
- For the vast majority of history, in all times and places, life has been much more difficult than it is right now. So if things get tough out there, remember that. And remember that challenging times give people lots of opportunities.
- If you’re smart, have ambition, and work hard, you will be fine. In fact, if you work really hard, you will do better than most. Even in a recession.
Recessions obviously cause suffering for many people, but I like the perspective you provided: that, for most of human history, things have been much more difficult.
I like to think of recessions as corrections of prior economic excesses. So, recessions are just low points in an ongoing cycle.
I also like to think of recessions as great stock-buying opportunities!
Exactly! And yes, I totally agree that recessions are corrections. Although I would say that sometimes they get out of control and negatively impact parts of the economy that don’t need correcting.