In past posts I have commented about hunger and what is called “food insecurity” issues, which increased significantly during and after the Financial Crisis.
In 2020, the economic decline has led to a substantial increase in hunger and “food insecurity.” Unfortunately, due to various factors it is difficult to get accurate and timely information on the dynamics of hunger in the United States. However, Feeding America indicates that “more than 50 million people may experience food insecurity in 2020.” Not only is this a substantial portion of the U.S. population, but this appears to be a substantial increase compared to the years of 2018 and 2019.
As well, there have been many articles indicating tremendous (increased) demand for food offered at food banks and other food offering events throughout the country.
Accompanying this hardship are other issues such as the ability for a substantial number of people to be able to make mortgage or rent payments. Ongoing moratoriums on evictions appear to have forestalled a significant if not substantial amount of evictions. However, many problematic issues on this “inability to pay” topic remain unresolved.
From an economic and financial perspective many issues have arisen. There appears to be a significant number of those individuals (as well as businesses) that are encountering a “first time of adversity.” In essence, this means that a person (or business) has experienced a pronounced detrimental change in status for the first time. This can take many forms, from those who have become unemployed for the first time, to those who need to receive free food for the first time, to those who are unable to make rent, mortgage, or other bill payments for the first time, etc.
Also – of particular note – is that these hardships are present despite the overall U.S. household net worth being at record levels. While this dynamic is not necessarily surprising in the current economic era, from a longer-term perspective this would appear odd.
From an economic and financial perspective, as well as societally, I believe there is great significance in what appears to be a substantial increase in those who are experiencing this “first time of adversity.”
The Special Note summarizes my overall thoughts about our economic situation
SPX at 3716.48 as this post is written