A global recession is a severe economic slowdown that affects all countries at once. It can be caused by many factors, including lower demand for goods and services, a drop in stock market prices and high debt levels.
A recession can have devastating effects on personal and business savings, but it’s important to remain calm and make wise financial decisions. In a time of uncertainty, you may be tempted to sell your investments or make other drastic changes to your portfolio. However, these emotional impulses can often lead to poor decisions that could hurt your long-term financial goals. Talking to a professional can help you feel confident in your investment strategy and avoid making costly mistakes.
In the early stages of the pandemic, governments implemented quarantines and social distancing practices to contain the virus, precipitating a sharp contraction of activity and massive job losses. This unprecedented level of disruption was especially felt by people in industries and occupations that required face-to-face interactions, such as retail, travel and hospitality, or paid less than the average wage, including women, minorities, and those without a college degree.
Governments pumped trillions of dollars into the economy through quantitative easing in an attempt to resuscitate the economy and markets. But lingering scars like higher unemployment and lower income levels have remained years after the Great Recession.
About the Author
