If you were to make a large purchase such as a house or a car, would you rather make this...purchase during a recession or during an economic strong time?
It depends. A house is usually a long term investment, purchase would be best when interest rates are low and house values are relatively low, and provided you can afford the purchase. Do you think there will be deflation? If so, financing is bad in a deflationary period. Investing during deflation would mean holding cash, long term treasury, bonds, etc. since assets lose value compared to the dollar. But if you think inflation is coming, then buy assets now that hold value (a house maybe, but not a new car) and finance them as much as possible.
Normally everyone prefer to buy a property by looking after our financials. If you have enough capital then there is no side thoughts to buy it. Only one thing we should look for is the price tag, during the rescission we may get a cheaper price rather at a strong time. And in the other scenario, if you are a working person and would like to go for a housing/car loan, then better to look for the current economic condition because majority of banks will not agree to give the loan amount as you required even though your salary permits. Also you should look for any predictions on economic conditions of the coming period because you should have the capacity to repay the loan. Just think about a bad condition and may loose your job etc., some negative thinking, but still it is required.
If your financial situation allows you to purchase a house in a recession, by all means go ahead to buy it, as it will probably increase its value in better and stronger economic times. Buying a car makes no difference whether it is recession or strong economic time, as it is always a losing asset - of course you will lose more in a recession or you might not be able to sell it at all.
I am not an Economist ... but its common sense, that I live a society, where most of us are subject to similar economic pressures.
I mean, the buyer and seller are exposed to similar pressures ... so it makes little relative difference, whether, I make a major Investment, during a Recession or wait for the Good times ...
During a strong economy, because right now, I would want to enjoy the security/pleasures of the house. Even if it is just a investment, I am more into enjoying moments. If I have a lot of money and a great team, I probably would invest during a recession.
by seanorjohn 8 years ago
Do you think a conservative government would lead us back into a recession?
by wacknuts 8 years ago
And what does it mean for us?
by Ralph Deeds 6 years ago
Perry accuses Bernanke of treason for FED efforts to stave off recession.http://www.nytimes.com/2011/08/17/us/po … perry.html
by ngureco 7 years ago
Ben Bernanke Has Claimed The Recession Is Over. Do You Believe Him?
by Evan G Rogers 7 years ago
I keep getting into discussions about economics on these forums (mostly because I hunt for them...), and the same response keeps popping up: "well, what are YOUR economic credentials!?". This is said to me (and those who agree with me) to discredit us - my dissenters generally point to...
by Doug Hughes 8 years ago
In 20 years, the history books will call this the 2nd depression. We are in a liquidity trap, according to Paul Krugman, nobel-prize economist. That’s central to the problem. “The term liquidity trap is used in Keynesian economics to refer to a situation where monetary policy is unable to...
Copyright © 2018 HubPages Inc. and respective owners. Other product and company names shown may be trademarks of their respective owners. HubPages® is a registered Service Mark of HubPages, Inc. HubPages and Hubbers (authors) may earn revenue on this page based on affiliate relationships and advertisements with partners including Amazon, Google, and others.
|HubPages Device ID||This is used to identify particular browsers or devices when the access the service, and is used for security reasons.|
|Login||This is necessary to sign in to the HubPages Service.|
|HubPages Traffic Pixel||This is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.|
|Remarketing Pixels||We may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.|
|Conversion Tracking Pixels||We may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.|