Blog

Recession: no wonder it is so hard to say if we are in one or not

By DJ Kelly December 10, 2008

Also available on the Calgary Herald’s Q.

I’ve been thinking a lot about the recession we are currently in – or the one that is coming depending on who you are talking to – and one thing has struck me in some of the commentary I’ve been hearing. It seems the horrible nature of a recession or a depression comes not from the low stock market yields but more from the instability of said markets.

This makes complete sense to me. As an investor I sure don’t want to invest in something that isn’t going to increase in value, but at the same time if I can predict when something is going to go down in value I can better prepare my financial portfolio. Where things start to get hairy is when there is no predictability. The markets are up one day and down the next.

This is when people start keeping their money in their pockets because they are scared to spend it – they have no idea when they will need the savings.

This all came flooding back to me when I saw the following two stories come through my Twitter one pretty much right after the other last night:

Calgary charities worry as donations drop
Spirit of philanthropy is thriving

In addition, I’m seeing stories about Ballet BC and the Baltimore Opera folding under the pressure, while personally I’m hearing local arts groups saying everything is okay so far – they haven’t noticed a drop off in sales at all.

Seems how no one can agree on whether things are just as good as ever or that the world is ending. So I’m going to go out on a limb and officially call it: we’re in a recession.