Surviving The Recession Cycle

6 Replies

Just a moment ago, a topic was posted about whether or not to buy with the "impending recession." And as a newby, it just makes me wonder: if recessions are pretty much counted on in a cycle, are they all as bad as 2008?

I was working construction at the time, and we went from 40 employees in September of 2008 to 0 employees in April of 2009. Of our four competitors in that town, only one made it through to 2010. Is that a normal level of decline? Or was that just a particularly brutal recession?

No, what happened in 2008 was not a typical recession. It was acutely abnormal. The last time we had an unemployment rate as high as that was the recession of the early 1980s, and the last time we had an equities and housing collapse as bad as that was the great depression.

Different recessions happen all the time.  Currently farmers are experiencing one.  The housing market got crushed in 07-09.  We had the Dot com crash in the early 2000s.  Interest rates went through the roof in the 80s.  Depending on were you are in society will dictate how you feel it.  The one we experienced in 08 was particularly brutal because it reached far and wide throughout the economy.   Were today unless you farm for a living you don't even notice.  Short of a world war I can't see something that brutal for another 50 years or so.  

Personally, I do wish for another 2008 again.  Buyers would be choosers and banks are giving away properties.  But I think most of us remember that (including the banks) so I don't think it would happen.  Just as long as people are smart, stick to their plan and not over-leverage, we would be fine.

every instance is different. the next one might be softer than 2008, or it might be worse. Either way it's quite likely NOT to be similar to the mortgage crisis.

So it's important to worry about everyone building businesses around the risks of the 2008 recession while the next recession will manifest in much different ways. Meaning everyone who is planning withe past in mind is unprepared for the future 


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