Reply to Second Great Depression

Forum Index » Money and Finances

Reply to "Second Great Depression"

Subject:

Emoticons





More smilies

Text Color: Font: Close Marks

[quote=Anonymous][quote=Anonymous]Back of the envelop analysis for sure but here goes:

Service sector is 2/3 of GDP

Almost all of that is at a standstill

[/quote]

Most of the service sector is _not_ at a standstill. Just the visible parts you see -- restaurants, hair salons, etc.

Most of the service sector is knowledge workers -- accountants, software developers, project managers etc etc... people who sit behind a computer all day. Most of those people can work from home. Of course, their productivity is likely down 50% since they are having to watch their kids due to school closures, or otherwise just worrying in general, but they're still there.

I do agree it'll be similar to a depression though. The government forcibly shut down entire industries, for at least a month or two. That's a huge hit on the economy. Layoffs are widespread. Let's say things went back to normal on May 1. There's still a huge ramp-up time to get people re-hired, train them (some probably will move jobs at the same time), and so on.

Some revenue you'll make back -- an order that was delayed will now come through. But others you won't -- people aren't going to get extra haircuts or eat out more times per week than before to "catch up". Business trips and conferences that are cancelled probably won't restart immediately -- they'll just wait until the next scheduled meeting/conference. People aren't going to take 2 vacations this summer instead of 1 because they had to cancel their planned spring break trip.[/quote]

Options

	Disable HTML in this message
	Disable BB Code in this message
	Disable smilies in this message

Review message

Search Recent Topics Hottest Topics