Where does all money and wealth go in the recession?

Question

Where does all money and wealth go in the recession?

In: 6245

Answer 1

So, without going into too much detail, the vast majority of money that exists only exists in a computer database somewhere. It’s not as if there is 100 grand in the bank that suddenly goes missing.

That money in the computer, a lot of it anyway, is based off of how much something is worth. If someone was in Bitcoin, and they had 2 million USD “in bitcoin”, when the value of it goes down that person now has less of a value in USD. Basically, it is how valuable something is. Same with the stock market. If all of a sudden, someone with 1 million USD in x stock, then x stock crashes and becomes less valuable, that person has that much less.