04/30/24

Is the United States In a Depression?

Those who spend their time on social media have likely seen a video or two stating that the United States is currently in what is known as a silent depression. But those in the government say this isn’t the case—so who is in the right here?

In this article, we will evaluate whether or not the USA is in a silent depression; keep reading to learn more.

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What is a Silent Depression?

Before we dive into our opinions, let’s take a look at the definition of a silent depression. According to Columbia University, a silent depression is “a period of slow economic growth that no one is talking about.”

A silent depression is characterized by the fact that the US government and other large institutions pretend that it doesn’t exist, though the numbers (GDP) say otherwise.

Is the United States in a Silent Depression?

Although we hate to admit it, TikTok is right this time around. The United States is in a silent depression, but not for the reasons TikTok states.

If you have come across any of these videos yourself, you’ll notice that influencers mention the prices of houses and cars versus income to characterize a depression. This is incorrect. The prices of goods and services have nothing to do with a depression—rather, these indicate inflation and other examples of poor monetary policy.

Even though the TikTokers aren’t using the right words, Robert Kiyosaki, the famed author of Rich Dad, Poor Dad, says they have it right. Remember, a silent depression is solely indicated by GDP and the country’s buying power on an international scale. According to Kiyosaki, the GDP has been in an ever-increasing slump since COVID-19, indicating signs of a current or pending depression that the government isn’t acknowledging.

Kiyosaki goes on to say that he believes that things will get worse rather than better. In 2023, the GDP grew by 3.4%. In 2024 (Q1), it only grew by 1.6%, indicating a recession is near. Although Kiyosaki admits that things could turn around, he truly doesn’t expect them to, and rather, he expects an even lower or no growth in Q2.

Kiyosaki additionally calls out the US government, stating they are ignoring the problem to keep the masses satiated. Kiyosaki encourages his followers on Twitter/X to prepare for a depression, because the US is currently in one, and he predicts it is only going to get worse from here.

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Signs That a Depression Is Coming

Of course, this is only our opinion sided with Kiyosaki’s and the influencers on TikTok. But below we have listed the signs of a depression, so you can come to your own conclusions.

1. Stock Market Crash

The stock market as a whole hasn’t crashed (yet) but various companies have gone under in the previous month, and major companies have seen a decrease in economic growth.

2. Decrease in Manufacturing Orders

Anyone with a business has likely seen this in the preceding six months.

3. Laid-Off Employees/Labor Reduction

We will let you evaluate this one on your own.

4. Oil Price Hikes

How much did your last tank of gas cost you?

5. Rising Inflation

If you need the answers to this one, just take a look at our previous articles about inflation in the United States.

6. Declining Property Sales

Have you tried to sell a house recently? What was the result?

Ways to Survive a Depression

Acknowledging that the United States is in, or headed, for a depression is scary, but the good news is, there are many ways your business can weather a difficult economic period. They are as follows.

1. Cut Costs

Take a look at your budget. What are you paying for that you don’t need at the moment? This could be services you rarely use, or a subscription that you no longer need. Take a few days and eliminate these extra costs. You may even consider laying off some employees.

2. Apply for Assistance

It’s better to apply for government assistance or grants well before you truly have a problem. Look at your local state small business website and see if there is anything there that you can utilize. Fill out the applications ASAP and submit them to the relevant authorities.

3. Invest in Current Customers

While it might seem a bit odd, now is the time to reach out to current customers and find out what exactly they need from you. If they desire an expansion in your services, see if you can do so. If they need a new feature, work on it. Either way, these steps will go a long way to fostering a connection with your customers and creating brand loyalty at a time when you absolutely need it!

4. Build Morale

Besides ensuring your customers are still with you, also take the time to ensure the remaining employees are still on board. While it isn’t the time to dole out raises, see what benefits your employees would like to see or what tools could make their jobs easier.

5. Automate

Now is the time to look into automating whatever processes you can. Whether this means getting an answering service or looking into bot trees and laying off customer service employees—do it. These small changes could save you thousands of dollars.

6. Don’t Stop Advertising

Many businesses make the mistake of slowing advertising during an economic downturn. Not only does this slow business at a time when it is desperately needed, but it also can cause customers to lose sight of your company.

Ensure you maintain advertising efforts during economic downturns, even if you have to cut back just a bit. With all the other companies cutting back, you might just catch a big break!

Overall, the United States is certainly in an economic recession and may even be headed (or in) a depression. If you own a small business, the time to prepare yourself and your business is now—before it is too late!

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Depression | Economic recession | Tiktok | United states economy | Depression readiness