How do we know for sure that there’s a recession coming, and why can’t we stop it?
In: Economics
1) historical indicators that lead to a recession. We look at things that happened prior to a recession both here and globally and can draw ‘reasonable’ conclusions that a recession is on the way. There are a ton of these but things like new construction, credit leverage and borrowing, growth of employment are some of the big ones.
2) There are things that can be done but some political groups are ideologically opposed to some of them. E.G Liberal leaning parties avoid things like austerity and Conservative leaning groups avoid public investment to spur growth.
Generally speaking, the global economy doesn’t like large, short notice disruptions. It is almost impossible to significantly change a supply chain when trade boundaries go up, go down, or otherwise change. This uncertainty tends to make businesses go conservative in their cash planning and they prepare to ‘weather the storm.’ Shareholders are fickle and missing your projections typically pisses them off, even if it’s not your fault.
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