As someone who writes words for a living, I'm admittedly not what one would call a "math person." My grasp on economic concepts is tenuous, so please do not treat the following as financial advice. However, after enough people say the same thing, coincidences become patterns that even money dummies like me can recognize. Economists are forecasting a recession on the horizon. All the hallmarks are there: weakening global economic growth, declining yields on the 10-year Treasury note, house-flipping ads on the radio, and B-roll footage of face-palming stock market traders on news clips. Friends, I am worried about The Economy. And I have some questions.
As a consumer, how exactly does one prepare for a recession? Should I refinance my home? Do I need to start stockpiling canned goods and ramen noodles and move my $46.09 in savings to a more secure place, like a mattress or a shoebox in my backyard? Is there a checklist I can hang on the fridge? I remember the last recession's local impact, the industry bailouts, the golden parachutes, the stimulus programs. But I was barely out of college and my gruesome financial situation in those days was mostly a self-made mess. Was I affected? Of course, we all were. Between credit card debt, student loans, and my decision to pursue a career in journalism at the exact moment people decided to stop paying for newspapers, I would have been broke regardless. Can't worry about your 401K when you don't have one, folks, am I right?
- Gints Ivuskans | Dreamstime.com
- Donald Trump
Experts predict the next recession won't be as severe or last as long as 2008's financial disaster, but signs point to a downturn. Some say it's already happening. So, what exactly is being done to prevent or mitigate a crisis, knowing just how bad things can get? Are we just waiting for China to blink and call off the trade war? Doesn't seem likely. Are Nancy Pelosi and the bafflingly impeachment-averse faction of Congress banking on a crummy economy in 2020 and expecting to ride the wave of destruction to a win for the Democratic party? It's so cynical and obviously doomed to fail, I'm sure it's been pitched as a serious strategy.
In the meantime, I'm not sure I trust some CNBC talking head, the executive producer of The Conjuring 2, and a "fringe" economist whose views are said to "go against a strong professional consensus" to guide us out of the fray. President Deals, whose tariff tête-à-tête with China is apparently causing much of the market panic, swears the Federal Reserve Board is out to get him. He laps up the credit for low unemployment, but shaky markets and any other bad omens that make it to the Resolute Desk are a cocktail of fake news and Fed conspiracy. And high-ranking economic officials such as Wilbur Ross — the guy who said rising aluminum costs won't affect the price of soup, a product that comes in an aluminum can — are downplaying recession fears on cable news shows. Forgive me if my concerns are less than assuaged. And I highly doubt buying Greenland would move the needle, even if it were an option.
According to the Treasury Department, the federal government has already spent more than $3.5 trillion in 2019 — that's the most it's spent over a 10-month period since the Great Recession. And the budget deficit is projected to top a trillion. Like I said, I'm no economist, but last year's tax cut doesn't seem to be paying for itself as promised. If spending is that high now, what happens when unemployment rises? Where is the next stimulus package coming from? Where's the money going now? What happened to those Tea Party Patriots who cared so much about spending and deficits?
Even if a looming recession is "garden variety," as Moody's chief economist Mark Zandi predicts, how many times is the so-called party of fiscal responsibility going to try the trickle-down thing before we put our collective foot down?
Jen Clarke is a digital marketing specialist and an unapologetic Memphian.