Will The Economy Crisis Have A V, U, or L shaped Recovery? – What's Up Clarksville

Will The Economy Crisis Have A V, U, or L shaped Recovery?

As the states begin the task of reopening, the question now is how long will it take the economy to recover? There are 3 types of recoveries that could happen.

  • V-shaped recovery: an economic period in which the economy experiences a sharp decline. However, it is also a brief period of decline. There is a clear bottom (called a trough by economists) which does not last long. Then there is a strong recovery.
  • U-shaped recovery: when the decline is more gradual, i.e., less severe. The recovery that follows starts off moderately and then picks up speed. The recovery could last 12-24 months.
  • L-shaped recovery: a steep economic decline followed by a long period with no growth. When an economy is in an L-shaped recovery, getting back to where it was before the decline will take years.
Will This Economic Crisis Have a V, U, or L-Shaped Recovery? | MyKCM

No one can answer this question with one hundred percent certainty. However, most top financial services firms are calling for a V-shaped recovery. However, no one knows for sure how quickly Americans will get back to “normal” life. We will have to wait and see as the situation unfolds. Call/text me at 931-237-1417 to discuss this further.