I imagine a huge cash crunch is coming up soon as deferred payments come home to roost.
We can’t continue kicking the can down the road forever. If people are over leveraged or insolvent we have to bear the pain eventually. It’s part of the credit cycle and it’s how savers get their foot in the door regarding asset ownership. Otherwise we will have basically embraced some absurd worst-of-both-worlds kind of socialism in which we bailout the people who are leveraged and over-exposed-to-risk at the expense of future generations and savers.
The Fed/Government can probably kick it down the road until November though.
If the actual economy (gdp, not equities) doesn’t make a v-shaped recovery then it’s inevitable. I think the shakeup of who gets rehired for which jobs is going to cause some personal bankruptcies regardless. Basically if Acme co laid off 5k people, the 5k they rehire to resume operations may be a different set of people.
We can’t continue kicking the can down the road forever. If people are over leveraged or insolvent we have to bear the pain eventually. It’s part of the credit cycle and it’s how savers get their foot in the door regarding asset ownership. Otherwise we will have basically embraced some absurd worst-of-both-worlds kind of socialism in which we bailout the people who are leveraged and over-exposed-to-risk at the expense of future generations and savers.
The Fed/Government can probably kick it down the road until November though.