The news about potential recession by the end of 2020 is all over the internet now a days. Even corporate are issuing less bonuses this year in an effort to surplus their budget to maintain the workforce for future. This is one side of the story. Now the other perspective is that there will be more bonus and hikes next year due to the plunge this year. These are all rumors that is mentally affecting people to make financial decision that they would not normally made if there was no recession
The rumor about, so called , inevitable recession will help plunge the financial markets; just because people are scared of it and will secure their investments , limit spending and risk-less investment.. In essence the money-mobility will be curtailed. In a way recession might not be coming or wouldn’t be that bad but the buzz will definitely adds to it.
Security is the next in the row of the basic fundamentals and priorities of sustainable life; food, shelter and cloth. Human beings by nature looks for security be it a moral, social or financial. This is the inheritance concept. This will reach it’s boiling point if not close, when we see our self susceptible to a life event of a financial instability. We save and we save. This breaks the economical cycle that is build on the circulation of money. The more the spending, the more the jobs, better financially stability and security. Rumors of recession and the psychological triggers for saving for the uncertainty becomes a add in factor in doubling the recession.
Simple example; People don’t eat out, Restaurants can’t pay the monthly mortgage, and their staffs, they fire workers and file for bankruptcy. If worse, bank files for help with the federal reserve, GOVERNMENT RESCUES but the county goes into debt.
Let’s clean out the cotter from our head so that there is no psychological add on to the recession. Lets be prudent on the economical and monetary matters that affect the market. Let’s all save ourselves. There is always a way out. We all are in it altogether.