The worst economic collapse in history is on its way. Be Prepared
This is a chart of the 2008 Financial Crisis. Over the course of 517 days, The stock market dropped by more than 56%, millions of people lost their jobs… their homes… and their life savings. It was the worst time for the global economy since the great depression.
And this is the 2020 Economic Collapse…so far… Over the course of just 21 days, the market has dropped by roughly 20%, the world has seemingly shut down, and we just might be on the worst economic trajectory in history.
So how did we get here…and what could we expect going forward. Well, let’s start off with the first part.
The first thing is that…as most of you know, there is a global illness going around that many people are worried about. And from my previous videos, you might know that my position on this is that if you get the disease, you will almost certainly be fine.
But it is disproportionately bad for the elderly, and those with underlying health conditions such as myself. So it’s good to be cautious on a social level, but also there isn’t a need for you to panic on an individual level.
Initially, when the disease had its first outbreak in China, it caused the Chinese Government to shut down its manufacturing sector in order to help prevent the spread of the virus. Now, that wouldn’t be a problem…if 1/3 of all products in the world weren’t made in China. You see, China is the global supply chain of the world, so when China experiences delays in production, the economy of the entire world experiences delays as well.
So, because of this supply chain slowdown, we have seen many large companies experience a slowdown in their sales and revenue. And this makes sense, because if you don’t have your product to sell, then you can’t make any money.
And here’s an example. The car industry is very dependant on tools, die, and machinery in order to manufacture their cars. But each one of these industries is experiencing 1 to 3-month delays because of the shutdown of the manufacturing sector. This means that car companies will not be able to launch their new annual vehicles on time, therefore missing out on billions of dollars worth of sales.
And this effect keeps trickling down. If the Car companies are seeing a drop in sales and revenue, then so will their suppliers. And if the suppliers see a drop in revenue, so will the raw industries that work with suppliers. And this effect radiates to all other companies that are connected to the automotive industry.
And what happens when a company sees a drop in sales or revenue? Well, we tend to see things like layoffs, or even bankruptcies. This would lead to a higher unemployment rate which would lead to fewer purchases being made by consumers, which would lead to fewer sales being made by businesses. And the cycle continues until the economy hits a low point like the great recession or the great depression.