EDITORIAL: Prepping for the next recession

Recessions are inevitable.

Every other business headline, every other talking head with a degree in economics has something to say about the possibility of a recession in 2019.

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And there is no better time to talk about it than now, days after the provincial government brought down its 2019 budget.

A recession will definitely happen. It might be because of China or trade wars or the simple fact that every boom time eventually stops booming and goes bust.

The blame usually gets thrown around shortly afterwards, while the average working (or newly unemployed) stiffs scramble to adjust while taking arrows from those looking to pin the blame.

People are spendthrifts, they have too many loans, they have credit card debt, they own a house bigger than they could afford, etc.

That all may be true.

But the reverse is also true, that before each recession, there are financial institutions eager to sell mortgages for little to nothing down, to hand out new credit cards to anyone with an active pulse and to add to the ever-expanding realm of debt.

It takes two to tango. The debtor can’t exist without the lender.

Forget blame for a moment. It is better to save than to borrow. If you can manage to live within your means and put away some money for tomorrow, you absolutely should do so.

Sadly, that’s about the best advice we’ve got. We’re 11 years removed from the Great Recession, the one that knocked thousands of people around the world out of work, blighted banks, humbled car makers and wiped out vast sums of wealth.

We’re on the verge of another crash, though hopefully not as bad as the last time. But it hasn’t started yet. Unemployment remains low, wages are actually going up.

So, while times are still good, save what you can, pay off those credit cards and make some plans for the days ahead, which might not be so rosy.

© Kamloops This Week

 


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