You can be just an average dude one day...and recession rich the next. But that means nothing really happened to you...just to everyone else. A recession hit. People are losing their jobs, homes, ability to pay bills, and retirement savings. But not you.
If you’re recession rich, it just means you are relatively “rich” compared to everyone else who was hit harder than you by the recession. It means you’re just going about your business, while everyone else is in panic-mode. But not because you meditate...because you’re more financially immune than others.
Maybe you already paid off your mortgage, or you’re almost done. Maybe because your job is in insurance, which is busy now since the recession. Maybe because you invested in mostly money markets and grocery stores. Maybe you’re retired and don’t have a care in the world. Maybe you're a trust-fund baby, so you really are rich either way.
The Great Recession in the 2000s created a class of recession rich people. Say the neighbor on your left just leased a brand-new car, and the neighbor on your right is sitting on a subprime mortgage and doesn’t know it. Boom, the recession hits. The car has to go back, and that subprime mortgage home is foreclosed. This was reality for many people who just had bad timing.
Related or Semi-related Video
Finance: What is a Business Cycle?3 Views
Finance allah shmoop What is a business cycle Well here's
a guy giving his cycle the business Yeah the bike
moves forward in time but this little white mark on
the tire while it keeps returning to the same place
again and again and again So yeah that's the foundation
of the notion of business as a cycle time continues
but you know business gets hot then cold then hot
then cold and yeah you get the idea Well why
is this the case Well lots factors They mostly revolve
around the wild pagan dance of greed and fear And
they get exacerbated when governments actively monkey around with the
cost of renting money otherwise known as the raising and
lowering of interest rates And if you're new to this
whole space if you lower interest rates and make money
cheap to borrow you heat up the economy or at
least you encourage it to get hot And if you
raise the cost of borrowing money well then you're going
to try to cool it off And the reason he
might want to do that is if inflation is roaring
right All right well in the us the business cycle
Runs roughly every eight years for what is called the
short cycle of business cycles for reasons only partly known
to humankind the money cycle revolves around the presidential election
cycle when historically every couple of terms the population gets
sick of one process of messing up government and they
choose to elect a new way to mess up government
So that's The short cycle happens every seven or eight
years and you see it in the stock market with
generally meaningful corrections Along that pattern there's also ate a
long business cycle that sees major shift about every quarter
century World wars affected numbers Technology innovation affects the numbers
and other exogenous factors like pollution and labor replacement by
robots Yeah yeah it's coming and healthcare or disease changes
and or big innovations that completely repaint the pavement such
that the tire slipped and turn and twist trying to
keep the bicycle upright The key goal Look outfor bollards
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What is a recession? Luckily, it has nothing to do with your hairline...hit play to find out more.