The U.S. economy is emerging from a panic, and not just a recession, says Jeff Korzenik director of regional portfolio management at Fifth Third Bank.
"Unlike traditional business cycle recessions, panics are characterized by a widespread loss of faith in the banking system, the demise of numerous financial institutions, and a collapse of credit in the economy," Korzenik writes in the Chicago Tribune.
"The route to rebuilding an economy after a panic is slow and painful. Our current recovery will feel far different from recoveries of the past half century. The strong months won't feel quite right and the weak months will feel as if a second recession is at hand."
Sound familiar? There's more, Korzenik writes, citing a century-old economic text, "A Brief History of Panics and Their Periodical Occurrence."
"The symptoms of an approaching panic… are wonderful prosperity… a rise in the price of all commodities, of land, of houses, etc., etc …, by the gullibility of the public, by a general taste for speculating in order to grow rich at once, by a growing luxury leading to excessive expenditures…."
"How easily all this could have described the years preceding the Panic of 2008!" Korzenik adds.
Today, workers' wages and benefits make up 57.5 percent of the current economy, which is an all-time low, the Associate Press reports.
Until the mid-2000s, that figure had hovered around 64 percent through boom and bust alike.
Analysts see big corporations as the only winners in today's recovery.
"The spoils have really gone to capital, to the shareholders," says David Rosenberg, chief economist at Gluskin Sheff + Associates in Toronto, according to the AP.
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