The Darkest Days
If someone had suggested in February that by the end of April, nearly half the world’s population would be living under some form of requested or mandatory confinement thanks to a global pandemic, they would have been gently led off for a ‘lie down’. Now lockdown is the new normal, and it seems few experts dare to anticipate the scale of the global recession we are tumbling into.
We are all hoping for a soft landing. The Great Depression (which began in the late 1920s and lasted until the early 1940s) and the 2008 global recession saw “stock markets collapsed by 50% or more, credit markets froze up, massive bankruptcies followed, unemployment rates soared above 10%, and GDP contracted at an annualized rate of 10% or more”, according to Nouriel Roubini, Professor of Economics at New York University's Stern School of Business.
The difference is that these calamities occurred over a few years. COVID-19 has managed to create the same microeconomic and financial outcomes in just twelve weeks.
A brief history of American economic recessions
However, the fact is that America can and will bounce back, regardless of how catastrophic this slump is. Since its founding, the United States has seen and overcome around 47 recessions (although this number is disputed). Here is a short overview of 5 of the most impactful American economic recessions of all time.
The panic of 1785
This was the first major recession of the newly formed United States of America. Lasting four years, it ended the business boom that followed the American Revolution. The crisis had multiple causes, including overexpansion and post-war debts. There was also little trade between states. Inhabitants suffered from a shortage of currency, high taxes, persistent creditors, farm foreclosures, and bankruptcies.
The late 1700s saw two other great ‘panics’, namely the Copper Panic of 1789-93 and the panic of 1796-97.
The 1807 recession
From 1803 until 1815, most of Europe was, at one point or another, involved in the Napoleonic Wars. Britain’s relationship with America deteriorated (even further) thanks to the former slapping trade restrictions on the latter and the growing habit of British naval officers seizing American trade ships and press-ganging the sailors into the British navy.
In response to the crisis, Thomas Jefferson passed the 1807 Embargo Act: prohibiting all American ships from trading in foreign ports. The result was the destruction of the shipping industry and associated suppliers and the paralysing of coastal economies. Recovery began in 1810 after Macon’s Bill No 2 was passed, which lifted all trading embargoes between America, and Britain and France.
The panic of 1819
Seen as the first American depression, the panic of 1819 had its roots in the cross-Atlantic trading boom that followed Napoleon’s defeat at Waterloo in 1812. Thanks to Europe’s demand for America’s cotton, tobacco, rice, and flour, credit was abundant, and banks offered it freely. Adding to this, government sale of land in the Wild West fuelled real estate speculation funded by bank notes.
The crash, when it came, was brutal. Unemployment soared, businesses failed, and land prices plummeted. Prisons became inflated with debtors, and many farmers were reduced to subsistence level.
Recovery occurred in the 1820s, and President Andrew Jackson became a hero of the oppressed working classes who blamed the wealthy elite and bankers for the suffering they had endured.
The great depression 1929-33
Inspiring great novels such as The Grapes of Wrath and Of Mice and Men, the Great Depression of the 1930s started on Black Tuesday, October 29, 1929, with a stock market crash. Consumer spending declined, as did investment, leading to drops in industrial output and massive unemployment.
By 1933, when the Great Depression reached its lowest point, some 15 million Americans were unemployed, and nearly half the country’s banks had failed.
2008 financial crisis
The most recent economic recession occurred just twelve years ago. The world once again faced a crippling financial predicament. An overheated housing market was once again the cause, with banks providing mortgages of up to 100% to borrowers with poor credit ratings.
Governments were forced to bail out banks with taxpayer money, unemployment skyrocketed, and many harsh years of austerity followed.
However long the night, the dawn will break
How significant will the global recession brought on by COVID-19 be? No one knows yet. But one thing is certain - history has taught us that we will get through it. It may be painful and take a while, but the world has already displayed great resilience, compassion and strength of character.
However long the night, the dawn will break.
African Proverb - Hausa Tribe
Trademarks in times of recession
In our new trademark report we will take a look back at the world’s biggest economy and its trademark activity in the USPTO during the Dot-Com Bubble recession of 2001 and the Financial Crisis recession of 2008-2009.
We examine the impact of these two recessions on USPTO trademark activity over the last twenty years, from January 1st, 2000 until December 31st, 2019 and analyze:
- Nice Class activity
- Oppositions rates
- Top filers
- Success rates
- And more
By shining a light on the trademark activity in the USPTO during the two most recent American economic recessions, we hope that we will help you to get an insight into what the future holds for the trademark community.
Our new report “Trademarks in Times of Recession” will be delivered straight to your inbox next week when you sign up now to get early access!