Why is K not Ok?

The Corona Virus pandemic, the thing that has disrupted everything as we know it and has removed the word ‘peace’ from the dictionary at the movement.

There have been many things this pandemic has done to us and our planet. It has shutdown the world, reduced CO2 emissions, made millions loose there jobs, put the biggest cooperates in survival mode and destroyed the global economy causing a recession.

What is an Economic Recovery?

An Economic Recovery occurs after the recession when the economy adjusts and tries to reach back to the point it was before the recession. There are various types of recoveries, all modeled after the English alphabet. There is the U shaped recovery and the V shaped recovery and some less obvious L and K shaped recoveries. Our main focus in this article is the K shaped recovery and why governments do anything in power to try to avoid such a recovery.

So what is a ‘K’ shaped recovery?

Before we go to the K shaped, let us understand v and u shaped recoveries. So if we try to visualize a V shaped recovery is when the market sharply falls and equally as fast regains ‘\/’ giving it a V shape. A U recovery is when the graph goes down sharply then more gradually and turns back up, this takes a longer time to do so than a V. The graph in this case appears to be a parabola.

A ‘K’ shaped recovery is a little different. As we can see in the image the line splits of and certain sections go up while others head down. In the Image we see it as various industries which are recovering and ones which are worsening.

This also happens to the society. During a K shaped recovery some section of the society, namely the rich gain faster while the poor fall back down. We can see this as the richest men in the world are gaining insane amounts of wealth, Jeff Bezos recently crossed 200 Billion dollar mark while others have gained multiple billions over the recession.

This all happens while the poor get more poor, loose jobs and get themselves into a worse stage than before. This imbalances the nations wealth distribution and this is why the governments try to avoid such a recovery.

Hope you learnt something from this article. Thank You for Reading!!



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