I know there must be reasons and this is a dumb question, but I’m a bit of an abstract thinker and have trouble grasping it from a big picture presepctive. Can someone break this down for me? Can’t we all just kind of agree to just kind of… Reset some numbers or something?
Sincerely,
I’ve never taken an economics class in my life
In: Economics
My ma always told me that the markets are driven by fear. Her degree is in journalism but she does a lot of complicated financial writing.
Basically what you’re asking for would require absolutely everyone across the world to agree not to panic and also trust that things would continue on after the pandemic, exactly the way they did before. Which are both longshots at best. So people start to hedge their bets. Which creates a downturn. Which people see and think it’s a sign of things to come.
It becomes a cascading effect snowballing across entire market and totally unrelated sectors. At the end of the day people are the market, not things. If people don’t have confidence in a global outlook, the market reflects that and ends up becoming an egg that created the chicken.
It’s really fuckin silly. However it’s also an evolutionary response to some degree. Shit starts going south, people start getting nervous.
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