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Assignment 5: Comparing Covid-19 Recessions and Past Downturns

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Assignment 5: Comparing Covid-19 Recessions and Past Downturns
While there are close relationships between the COVID 19 recession and past downturns
such as the Global Depression of 1929 to 1939 and the Global Recession of 2008/2009, their
differences are far overriding. In a more analytical discourse, the overall downturns can be
argued to present related adverse effects albeit in different proportions.
One key similarity between Covid-19 recession and other past recessions is uncertainty.
Shiller (2020) in his analysis of the uncertainty cutting across these downturns notes that the
occurrence of the Great Depression that began in 1929 was marked by great optimism of quick
recovery of stock markets in the nearest future. To a great surprise, this was not the case until the
1940s when the hope of recovery became evidently visible (Shiller, 2020). The scenario is not
different from the great anticipation that COVID19 would possibly be contained in two weeks
from the time it struck, particularly in the United States (Shiller, 2020). Today, it has more than a
year and the U.S. and the world are still battling the spread and the effects of the pandemic both
in the social and economic arenas. Such underpins the argument that uncertainty is a common
characteristic of the Great Recession and Covid-19 recessions.
Secondly, all three recessions resulted in economic slowdowns although in different
degrees. The collapse of stock exchanges of major countries is one of the major issues registered
from the Great Depression, the Global Financial Crisis, and the COVID 19 triggered recessions.
Unemployment is another common issue across these recessions. For instance, while Gopinath
(2020...