Are We Headed For a Depression?
May 15, 2020
Perspective And Strategies To Consider In Today’s Environment
If we look back at past depressions in U.S. history, there are some important facts to remember as we begin to ponder the possibility of another one on the horizon. The depression of 1920-21 was largely caused by troops returning from war entering the job market thus creating a surge of unemployment and wage stagnation. The government did little to assist. During the Great Depression it took the Government 4 years to act and pass its first bill (1933). In addition, the actions of Federal Reserve of that time were much to the contrary of what the Fed is doing today. Back then the Fed actually raised interest rates and declined to act as lender of last resort thus adding to the length and severity of the Depression.
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