By David Koch, CFP®, AIF®, CFA, Senior Wealth Advisor
It’s different this time: The current economic crisis is not a rerun of the Great Financial Crisis (GFC) – which gives us fuel for optimism
Every economic crisis is different. In fact, every crisis – from tornados to pandemics to recessions – has different attributes and impacts. But that doesn’t mean that we can’t learn from them.
We think it’s useful to consider how the current economic downturn differs significantly from what happened in 2008. Not only are the causes vastly dissimilar, we now have a stronger sense of what works in terms of remedies. In many cases, we also have more economic tools at our disposal to provide relief and get the economy moving again.
One of the results: The Fed created a set of tools, e.g., Quantitative Easing (QE) that were tested for first time beginning in 2008 to bring liquidity to markets. They are using many of these same tools again to fix liquidity issues brought on by the current crisis.
We’re about to experience more than $2 trillion in economic stimulus injected (expeditiously, we hope) into our U.S. economy. This will no doubt provide a large measure of relief to hard-hit individuals, families, businesses, and corporations. It’s our deepest wish that this effort will contribute to a strong, durable, and rapid economic turnaround that future generations can learn from.
For more information or questions, please contact Halbert Hargrove at firstname.lastname@example.org