Hacker News Reader

Comment by tathougies | Hacker News Reader

Recession in a technical sense, yes, but not in a societal sense. A recession typically implies that people don't want to buy stuff or don't have the funds to. This time however, consumer demand is going to be probably the highest it's ever been the moment the quarantines are lifted.

View on HN

> "This time however, consumer demand is going to be probably the highest it's ever been the moment the quarantines are lifted."

With the huge number of small businesses collapsing, it seems unlikely that the immense numbers of newly unemployed (likely including myself) are going to be have any spare cash to drive demand when the quarantines are lifted.

Government is giving the businesses free money. And the newly unemployed are going to benefit from (1) free money from unemployment insurance, and (2) nowhere to spend it in the next few weeks, which means (3) lots of money to spend.

They're going to be saving up that unemployment insurance to pay their bills when the time limit runs out and their free time will be spent looking for work ... and most likely not finding any. Hiring is unlikely to rebound for 6+ months; too many businesses have collapsed already or will collapse soon before any government intervention occurs.

What? Where do I get my free money? Also, unemployment is not nearly enough for most people (it barely will cover a family's utilities and cell phones).

https://www.washingtonpost.com/business/2020/03/18/trump-cor...

The federal government is planning on sending thousands of dollars out to Americans directly.

That is in addition to unemployment, which in the currently proposed bill also provides for paid sick leave

What more do you want?

not if everyone loses their jobs in the interim.

It is highly unlikely that this will happen. Temporary layoffs are extremely likely, and extremely good, because they result in high unemployment claims (which the federal gov't is now funding even more), and will mean the businesses survive to rehire them. Nothing fundamental has changed about what people would like to do. These measures are temporary. That's my opinon.

> Nothing fundamental has changed about what people would like to do. These measures are temporary.

My wife's a PhD microbiologist, and works at a $bigPharma, and she's not convinced that we will be back to normal any time soon.

I'm currently in an area where we are essentially in total lockdown. All non-essential shops are shut. Businesses are laying off staff everywhere. Hotels and restaurants are all closed. Borders to neighbouring countries are closed. Schools and kindergartens are closed. Even the local playgrounds are closed and taped up - try explaining that last one to your 4 year-old.

Recovery in six months' time? I'm struggling to see it.

> consumer demand is going to be probably the highest it's ever been the moment the quarantines are lifted.

Happy debt bubble land is over, for a long time.

Reply on news.ycombinator.com