In March, we declared our 2020 forecast null and void. The COVID-19 pandemic had essentially rendered it irrelevant. The question we posed in March was whether the disease and the steps taken to manage it would lead to a recession or a depression. A recession is a cyclical financial process inherent in the business cycle. It is inevitable, stabilizing and somewhat painful. A depression is entirely different. It includes myriad financial dimensions as well as an added element of physical economic damage. It can destroy businesses and dramatically increase unemployment and thus transform our very existence. I would encourage you to read Studs Terkel’s “Hard Times: An Oral History of the Great Depression.” The greatest effect of a depression is on the existential reality of daily life. In that sense, we must all care about what this is.
