Not the First Recession
This isn’t the first recession we’ve had in the United States, and it is certainly not the first time that economic downturns have sent people running for payday loans. The U.S. has had at least 18 recessions in its history, and has always recovered. Granted, that may be small comfort, but rest assured that if you need money because of the slowdown of late, there is light at the end of the tunnel. Every recession since the Great Depression has been a relatively short one, and it is likely that this one may be over by the end of next summer.
There have been Recessions since World War 2, but Few that Lasted Long
Since World War 2, the United States has been one of the most profitable and productive nations in the world. It isn’t that likely that this will change. We Americans love to feel a sense of accomplishment through our work and our other endeavors.
1953: The first recession to occur after the Great Depression was a result of a loss in consumer confidence and spending during a period of inflation. The inflation was caused by a scarcity of goods in the wake of the Korean War.
1957-1958: The next round of inflation was caused by a sudden drop in the purchase of raw materials. When the purchase of raw materials dropped as a result of lower demand for them, the amount of production began to trail off, especially in the automotive industry. Unemployment went up, as did inflation, and many sectors of production began to contract until 1959, sending people looking to payday loans for a temporary cushion. The permanent result was an increase in the price of goods from then on.
1973 – 1974: The recession of January 1973 until December 1974 was a result of several factors that came to a head in 1972. In the wake of the 1971 Yom Kippur War, OPEC (or the Organization of Petroleum Exporting Countries) decided to embargo countries that had supported Israel in waging war on OPEC nations. The oil embargo, coupled with stock market crashes as a result of the US being taken off the gold standard, produced an almost two year period of what is known as stagflation, or an increase in the price of goods while the economy shrinks.
The Current Climate
The current recessions’ outlook is not exactly pretty. Unemployment is beginning to rise, and the stock market has had more ups and downs than all of the roller coasters in all of the Six Flags’ theme parks. The housing market has taken an enormous hit, and it doesn’t show signs of recovering anytime soon. However, my forecast is that in the summer of 2009, the recessionary period will be over, and things will resume growing again, so there is hope on the horizon. Yet, there are going to be some changes that have to be made in order for better growth, and more growth to occur, especially with how banks and other institutions lend, but in the meantime, if you have a sudden expense that is harder to surmount because of the current economic climate, and you need emergency funds, you have payday loans available by lenders that won’t cause the stock market to crash.
This whole thing reminds me of the hype of Y2K, when we thought the world was gonna “crash”. We all woke up that morning like any other day. Like we will with the current recession, American’s will continue to pull through like we have in the past.
Very informational article by Perky on Payday. I was unaware of the recessions that the US has had since the Great Depression and it’s also nice to have some hope that the recession will end soon.