Could somebody ELI5 for me why, during periods of both prosperity decline, the economy movement is stable for the most part, but in order to cross over from decline->prosperity or prosperity->decline, there is a huge and sudden swing?
1837 and 1873 appear to be bubbles bursting (maybe) - is every sudden downswing a literal, practical panic?
And why are the upswings just as sharp? What is happening practically during those moments that make the swings so sudden compared to economic activity "during" a prosperous or downturn period?
There's a momentum to consumer confidence and credit crunches. Folks were talking about the 2008 crash for about 18 months before it happened. We're staring down something on the horizon now, and I'm sure someone more economically minded than me can envision what it is, but will it hit in 1 year, 3, 5?
Everything is usually sunshine and roses until it's not, and then things stay conservative until there's some sort of all clear.
People are moody, and will ignore the problems and keep pushing further investment / work harder / we need to hire now! or nobody can make money / why bother going to work / fire people or get bankrupt! for way longer than it makes sense.
1837 and 1873 appear to be bubbles bursting (maybe) - is every sudden downswing a literal, practical panic?
And why are the upswings just as sharp? What is happening practically during those moments that make the swings so sudden compared to economic activity "during" a prosperous or downturn period?