Put Your Patience Hat On
- The coronavirus greatly affected our economy, throwing off the normal economic cycle.
- We’ve been living through the effects of this for the past few years.
- When will we get back to normal? It’ll take a bit of patience.
If you’re being told to be patient, it’s usually at a time when that’s the last thing you want to do. Unfortunately, sometimes we have no choice but to put that patience hat on and give things time to work through. This has been the case with the coronavirus and its aftereffects.
We in the U.S. started being affected by the coronavirus in March of 2020 – and here we are, weeks into 2023, and we’re still dealing with the aftereffects. It took us a full two and a half years to get used to the coronavirus. Initially, we had to react very quickly to it. One of those reactions was putting around $5 trillion into the economy over the course of one to two years.
Now, you can’t throw that much money into the economy without consequence. Think of the economy as a patient who’s being dosed heavily with antibiotics without taking time for the body to process them. In the case of the economy, we know that during the first two years of the pandemic, consumers saved an extra $2.1 trillion in savings accounts. Over the past year, $1.3 trillion of that money has come back into the economy as consumers spent it for a variety of reasons, but primarily due to inflation.
This threw the entire economic and business cycle off. This cycle starts with an expansion, gets to a peak, begins to contract, goes into a trough, and then starts over. However, we don’t seem to be on a regular cycle that we’d normally see in business. We can’t pump $5 trillion into the system and expect it to quickly work its way through and begin a recession. It took two and a half years to get to this point and it’ll probably take another two and a half years before we’re back to a normal business cycle.
So, try putting your patience hat on. Our free market economy has followed this cycle for hundreds of years – it’s just taking a bit longer this time. A little patience will help us see things through, getting us back to normal in a few years. Until next time, enjoy.
If you’d like to read more on this topic, here are a few of our past Coyle Blog posts that you might enjoy:
Here’s Why – In Trying Times – Keeping On The Sunny Side Brings Focus, Fate, And Fortune
It’s Been 50 Years, Folks! Let’s Discuss Net Worth, Life Worth – And What Ed Coyle Taught Us About Legacy Horticulture
Gary Klaben serves as a Financial Advisor, and visionary for Coyle Financial Counsel. He has over 30 years of experience and is the author of Changing the Conversation, Wealth of Everything and co-author of The Business Battlefield. Whether advising his clients, mentoring his team, or coaching entrepreneurs, he is always simplifying complexity and motivating others to take the next action that’s right for them.
Learn more about The Coyle Process, approach designed to get your arms around the big picture, so you can make informed financial decisions. Ask Gary about The Coyle Process and schedule a complimentary consultation and start living the Good Life Managed Well™.
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