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The Real Danger Being Hidden by Covid and the Stock Market Decline
Over the past week, something happened in the financial markets that has never EVER happened before. To put this event into context — which as you’ll soon see is almost impossible, I’m enlisting the help of an equally bleak scenario that might be somewhat easier to grok.
Imagine that tomorrow morning, you wake up and the price of your house has fallen 75%.
No big deal for you maybe. Maybe you don’t own a home. But imagine if the price of EVERY house in America dropped 75%, almost overnight.
What does it mean? You might be struggling to wrap your head around such a precipitous fall in home prices. It’s difficult to really comprehend what it could mean. Maybe it’s great news for you, if you’re house hunting, but there’s no doubt: it’s a colossal disaster for a huge number of people.
And there’s no question that it would have sweeping after-effects that almost no one can really understand or predict. It’s all a great big guess.
The entire housing market of the United States is somewhere in the neighborhood (pun intended) of $35 trillion.
What would it mean if that market shrank to $9 trillion? It would be some kind of disaster, but who can even guess what it would mean?
