Why our spending habits are most important when it comes to the economic recovery.
Imagine being in a battle a few hundred years ago. You know, swords, shields, maybe an axe, but very much a bunch of people running towards one another with an intent to do harm and see who comes out alive on the other side. Warfare truly is barbaric, and you really have to wonder why we still choose to do it, but that’s another matter. The point is, everything is relative. Whatever it is we are going through right now, with all that horrible inconvenience of having to stay at home and watch Netflix for hours on end, ain’t all that bad when compared to a Viking apocalypse.
So, we have a few more unemployed, we have essentially wiped out global travel, international tourism and anything requiring contact with other human beings. That includes many entertainment venues, such as football games, concerts or festivals and also restaurants, pubs or other places to get lots of people together and spending money. And that’s the bit this whole economic conundrum is built upon: how will we, the consumer, continue to spend our money?
Clearly you have to have it, in order to spend it, but that’s what all the monetary and fiscal stimulus is there for. Global governments have basically underwritten this whole crisis and central banks have signalled that they will do whatever necessary to provide liquidity during this economic slowdown. Loans to businesses? Check. Welfare for the unemployed? Check. How about a little spending money? Check, just so long as Donald Trump can put his name on it.
Which brings me back to the point and with all of this money, are we going to buy that new car, will we go to the restaurants, will we go to the shops and most importantly, when will we book our next holiday? Retail shops, auto makers, travel companies, the airlines, the fuel tankers, the credit card companies, the insurance people, the banks, and even government officials, they are all standing by and waiting to see what we will do. Well then, in the immortal words of Morgan Freeman in that enduring classic Shawshank Redemption (1994): we either get busy living or get busy dying. Time to decide if we are going to go for that 65 inch TV in the living room, the whole world may depend on it.