Let’s discuss the 2023 recession and debt ceiling, why the United States spends so much money, and what this means for you, your money, and your investments – Enjoy! Add me on Instagram: GPStephan | Follow my newsletter here:
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The Debt Ceiling:
Simply put: the “debt ceiling” is the MAXIMUM amount of money that the US Government is allowed to borrow, to pay for all of its obligations, like social security and medicare benefits, salaries, interest on the national debt, tax refunds, and a multitude of other responsibilities that a country needs to maintain. However, once this debt limit is reached, or – we hit the ceiling … all of those items can longer be funded to the point where, services slowly begin shutting down to conserve resources.
As of now, the United States is expected to reach their “debt limit” on Thursday, January 19th…after it was already raised by $2.5 trillion dollars back in December of 2021 – Although, what makes THIS time so unique is that it’s no longer a game of money, but instead, it’s a tug-of-war of negotiations.
In this case, In THIS case, one side wants their spending initiatives to pass, while the other wants spending to be REDUCED – and, they both have to agree if we’re to move forward. As the New York Times pointed out, “breaching the debt limit would lead to a first-ever default for the United States, creating financial chaos in the global economy. It would also force American officials to choose between continuing assistance like Social Security checks….and paying interest on the country’s debt”
If we look back in history….so far, the “worst” debt-ceiling standoff, which resulted in a lower credit rating, caused the markets to drop almost 20% in TOTAL until a resolution was drawn – from 1995 to 1996, the SP500 dropped about 4% – 2013 saw another 6% drop – and, over the last 10 years, we can see that there’s typically short term hesitation in the markets…until it’s eventually raised, and then..the stock market goes up right alongside with it.
So, the reality is, short term until this is resolved, investors may try to price in the slim, slim, slim chance of a government shut down – but, as we can see – realistically, they would NEVER allow the government to get to the point of defaulting on its debt, and – most likely, everything will carry on as usual, especially considering that we have until June to figure something until the “extraordinary measures”run out.
It’s probably not something to worry about, although – if you see it listed as a headline in the coming few days, weeks, or months, at least now you know WHY its become such a large talking point…and hopefully, this helps you understand a little more as to how dysfunctional the entire process really is.
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BREAKING: Recession News
LEARN MORE ABOUT: Bank Failures
REVEALED: Best Investment During Inflation
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The 2023 Recession Keeps Getting Worse
As we step into the year 2023, the global economic situation seems to be worsening by the day. The recession that hit the world in the previous year shows no signs of abating, leaving millions of individuals and businesses grappling with the debilitating effects.
The root causes of this recession are manifold, but the ongoing COVID-19 pandemic appears to be the primary culprit. Despite the introduction of vaccines and medical advancements, new variants of the virus continue to emerge, leading to further waves of infections and ensuing lockdowns. These restrictions have severely hampered the functioning of numerous industries and disrupted global supply chains, causing a domino effect on the economy.
One of the sectors hit hardest by the recession is the travel and tourism industry. With countries imposing travel restrictions, mandatory quarantines, and outright bans, airlines, hotels, and tour operators have borne the brunt of the economic fallout. Thousands of jobs have been lost, and businesses in this sector are struggling to stay afloat.
Similarly, the retail industry has suffered a significant blow as consumer spending patterns have changed drastically. As people fear for their financial stability and prioritize essential items, luxury goods and non-essential commodities have taken a back seat. As a result, numerous stores and brands have had to shut down permanently, and unemployment rates have skyrocketed.
The manufacturing sector, too, has been grappling with the repercussions of the recession. With weakened demand and disruptions in the global supply chains, factories have been forced to cut back on production. This reduction has resulted in job losses and a general slowdown in economic activity.
The real estate market has also experienced a sharp decline in demand. As people face uncertain economic prospects, buying homes or investing in properties has become a low priority. Consequently, property prices have plummeted, leaving many homeowners underwater on their mortgages. This situation has further compounded the already dire consequences of the recession.
Furthermore, the recession has trickled down to impact individuals and their daily lives. Businesses are cutting back on expenses, leading to layoffs and reduced salaries. With increased financial strain, individuals are finding it difficult to meet their basic needs and pay their debts. The psychological toll of the recession cannot be understated, as people struggle with anxiety about an uncertain future.
Amidst this bleak economic landscape, governments worldwide find themselves in a tough position. Balancing public health concerns with the need to revive the economy has proven to be an incredibly challenging task. Fiscal policies and stimulus packages that provided temporary relief in the early stages of the recession are no longer sufficient to combat the worsening situation.
The road to recovery remains arduous and uncertain. Experts argue that systemic changes are required to prevent future crises and build a more resilient global economy. Governments must focus on strengthening healthcare systems, investing in sustainable industries, and fostering innovation. Additionally, measures such as unemployment benefits, debt relief, and retraining programs can help individuals and affected sectors navigate through these turbulent times.
In conclusion, the 2023 recession continues to worsen, burdening economies globally. The ongoing pandemic, coupled with its various implications, has wreaked havoc on industries, businesses, and individuals alike. Governments must act swiftly and decisively to implement sustainable solutions, as the repercussions of this recession are likely to be felt for years to come.
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Its june 30, 2023 no recession. The SP500 in fact just stared a bull run. Lol
Increasing interest rates are going to continue to increase bank failures because it puts their commercial paper and treasuries underwater. They need to freeze interest rates to prevent a deep recession in the economy. At the same time the White house needs to help industry to increase gas and oil output to reduce fuel prices. The war on oil only serves to increase energy prices which trickles out to the rest of the economy as inflation. Lowering interest rates, tightening the money supply, reducing government spending and increasing the cheap supply of fuel will result in reduced inflation and a booming economy. Presto, no inflation and no recession. Of course there are a lot of other agendas out there that will never let all of that happen, so hello recession and sticky inflation.
Given the situation, I think I should view a video on "How to survive the current recession." It's a total failure, in fact. I was amazed that some folks were still able to make more than $$k in a short period of time. If that's still the case, could you clarify how?
Where’s my picture of a turtle?
One thing people fail to do (especially millennials) is INVEST. I made my first million from blue chips and top etfs using a broker so i invested and re-invested my profits. I also acquired large amount of high-quality dividend-paying stocks too that gives me a solid base of passive income. ever grateful to Olivia Maria Lucas handling my portfolio, two years now and she still surprises me, she's actually the only person i know that's richer than me haha
The US is a fully loaded, lifted Ford 250 Lariat that you can buy on paper but can't afford.
We are being robbed and no one is doing anything
The good news when we suffer through a horrid Democratic recession/Depression? They will lose BIG in 2024 unless, of course, they corrupt THAT election!
JUST PRINT MORE MONEY AND ALL OF THE PROBLEMS BE SOLVED!
Worry about yourself
We already in a recession you mean a depression.
A common rule of thumb is that two consecutive quarters of negative gross domestic product (GDP) growth mean recession.
Changing the definition like this current regime does will not alter reality.
A recession when your neighbor loses his job; it's a depression when you lose yours.
"And recovery is when Joe Biden loses his.”
Investors have a lot to think about and losses to make up after a dreadful year in 2022. The Federal Reserve is expected to continue raising interest rates even if the economy slows down, which implies that portfolio returns will be negative in the first quarter of 2023 despite an inflation report and a wealth of other data. In this shaky economy, how can I generate money? Yet debatable is my $250k bond and equity portfolio.
"what's up graham its guys here" really…so no one checks before he uploads
6:00 1917, so it proves capitalism doesnt work
"Year-over-year inflation stood at 6.5% in December 2022—the lowest that figure has been in more than a year. Inflation was in line with what economists expected and gave many of them a reason to believe that the peak of inflation may be behind us. I have approximately $150k stagnant in my port_folio that needs growth. What is the best way to take advantage of this downturn?
Lies musk story cancel
Us ruin the economy
The rest of world : heeeelp
Over 100%of GDP, this is insane, with that said I ask is Biden insane,financing study on toilets ,I'd call this insane.
Biden must have failed math in school, when u spend more than you take in , you go negative ,just thought I'd let Biden know that.
What’s coming will make 2008 look like nothing
What’s coming will make 2008 look like nothing
Great video ,I agree having a brokerage advsor for inveesting is genius! Not long ago amidst the pandemic crash in March 2020, I was really having inveesting nightmare prior touching base with a advisor. In a nutshell, i've accrued over $950k with the help of my advisor from an initial $70k investment thus far
In all ramifications, this seems like the worst period. The markets are now very unpredictable. Started investing recently when the market prices were a bit high, today I am more than 60% down.
Vote republican…
Hey, any of you "winners" remember ever picking on boy scouts? Alot of those scouts became military. I bet now youll wish you had some basic boy scout skills. Well, within the year.
what is this comment space
Too much hand movements.
Wait. Did he say "Whats up Graham, guys here?"
All this is nonsense when someone kicks your door in & blows your brains out because there is civil unrest through the country…
This aged like milk.
back with another comment for the youtube algorithm
Call a spade a spade. This is all thanks to a few people in the GOP that want to break everything down.
Why post this video since you gonna post capital just postponed the recession, it just got cancelled
How will this affect other countries who have the dollar currency tied to theirs? Like Saudi Arabia
I don’t know that much about the stock market but everyone was saying we would be in a recession in 2023 and so far the stock market is going up does this mean the recession is over or is it just a small uptick before it goes back down again
Major indexes booked their worst yearly performance since 2008 thanks to drivers like the recession, war, hiked interest rate and inflation which so far doesn’t seem to be easing off, so I’m left wondering what 2023 has in store for us investors, I’ve been sitting on over $745K equity from a home sale and I’m not sure where to go from here, is it a good time to buy or do I wait?
At some point, a bear market will end and a new bull market will begin. But how can you tell when the market bottom has been reached. How can I profit from the present market", I mean I've heard of people making upto $250k in couple months during this crash and I'd like to know how.
Wow Graham now resorting to lies and faking tweets from Elon Musk, that is a new new low…
Elon thank u.. we need more powerful leaders brave enough to risk it all for the nation that made them . To many cowards are allowing the b.s we been going through for years.. thank God for trump .