More Money Podcast - 387 Why Some People's Finances Improved During COVID - Author and Senior Economist Scott Fulford

Episode Date: February 7, 2024

And we're back with Season 18 of the More Money Podcast! I think it's finally not "too soon" to talk about the pandemic and what the heck happened (right?). That's why I invited Scott Fulford on the show, a senior economist at the Consumer Financial Protection Bureau and the author of the newly released book The Pandemic Paradox: How the COVID Crisis Made Americans More Financially Secure. I know, that sounds a bit odd doesn't it? How could people have become more financially secure when all the news headlines talked about were layoffs and people struggling to pay their bills? Well, as Scott discovered in his research and interviews with Americans across the country, although many people did have a tough time riding out the COVID wave, the majority actually thrived financially. But why was this? That's what you'll learn by listening to the full episode. I'm also giving away a copy of Scott's book, so make sure to visit jessicamoorhouse.com/contest to enter to win! This episode of the More Money Podcast is presented by The Globe and Mail. Visit TGAM.ca/Jessica to get unrestricted access to globeandmail.com for only $1.99/week for 52 weeks (plus tax). Follow me: Instagram @jessicaimoorhouse Threads @jessicaimoorhouse TikTok @jessicaimoorhouse Facebook @jessicaimoorhouse YouTube @jessicamoorhouse LinkedIn - Jessica Moorhouse For full episode show notes and transcript visit jessicamoorhouse.com/387 Learn more about your ad choices. Visit megaphone.fm/adchoices

Lou, Lou, Lou, and welcome back to the More Money Podcast. I'm your host, Jessica Morehouse. This is episode 387 and season 18 of the podcast. I hope you had a good time without me in, you know, end of December. January took all of January off, which normally I don't really do. I usually kind of come back a bit earlier than that. But if you've been following the podcast for all of last year, then you know why I took it off. That was the final month of me writing my book and the manuscript is officially done and handed into my editor. And so now we wait. I actually am so in love with this weird in-between time of me, hey, the book is done on, you know, sort of, I mean, the first draft anyway is done. And then I just got to hand it off and then just chill for a few weeks. And then we will dive into the next phase, which is editing.

And I, I'm not really looking forward to it, quite honestly, because it's basically going to be like, fix this, take this out, let's chop up your baby, basically, thing I've been living with for a whole year. And I chose all the words so specifically and love it to death. And we're just going to rip it to shreds a little bit. Obviously, it is for a good reason. We're going to make it as good of a book as possible. And that's the goal. But yeah, I wrote a freaking book last year. I can't believe that I actually did that. I thought it was going to kill me, quite honestly. There were times where I'm like, I can't go on. I can't go on. I can't do it. And then I'm like, well, we already, you know, started it and we have a contract and we have to kind of finish it. And so, yeah, so that's the exciting news. Finish that it and we have a contract and we have to kind of finish it. And so yeah,

so that's the exciting news. Finish that book and we will see what's, you know, I'll give you updates on how the rest of this editing process goes. But I'm really, really excited. But speaking of books, one of the reasons I love having this podcast is I get to have amazing authors on the show and I get their books and I get to read them. And then I also get to give them away to lucky people like you. And I will be sharing details about last season's contest and this season's contest book giveaway. So stay tuned for that. That will come at the end of the podcast where I share a little life update and information that you will want to know about things. But for today's kickoff episode, season premiere, I've got Scott Fulford on the show today. He is the author of The Pandemic Paradox, How the COVID Crisis Made Americans More Financially Secure. I know, it's kind of an interesting idea, which is why I wanted to have him on the show.

Now, he really knows his stuff. We were talking like, wow, this guy, I'm impressed I was keeping up. He is a senior economist at the Consumer Financial Protection Bureau, and his academic and policy research examines the economic problems that individuals and households face and how they use financial products to help deal with them. He also taught economics and international studies at Boston College before joining the CFPB. And he, of course, holds a PhD, no big deal, in economics from Princeton University. You're really going to enjoy this. And I am giving away a copy of his book. And I have a lot more authors to come on the show and a lot more books to give away. I'm going to save all that to the end. We've got a lot to talk about in this episode. So let's get to it. This episode of the More Money Podcast is supported by The Globe and Mail. We've yet to

see what 2024 has in store for us when it comes to the economy, interest rates, housing prices, and inflation. But the one thing you can always be certain of is no matter what's going on in the world, you'll never regret investing in yourself by growing your financial knowledge. And what better way to do that than to check out all of the amazing resources from The Globe and Mail, Canada's leading source of business and investing news. At globeandmail.com, you can learn more about saving, investing, and reducing your debt from their expansive array of personal finance content, helpful tools like the Globe's Watchlist and RRSP Savings Calculator, podcasts, and newsletters like my personal favorite, Carrick on Money. And for a limited time for more money listeners, the Globe is offering unrestricted access to GlobeandMail.com for just $1.99 per week for the first 52 weeks plus tax. For full details, visit tgam.ca slash Jessica. Once again, that's tgam.ca slash Jessica.

Welcome, Scott, to the More Money Podcast. Thank you so much for coming on the show. Thanks for having me. You're so welcome. So you have a brand new book out called The Pandemic Paradox. I was just, it's so funny that we're now, I mean, I mean, yeah, it's several years after when the pandemic started, but it is kind of crazy that now we're writing books about what happened. It still feels so sometimes fresh, or maybe, I don't know, it's still like, you know, chills. I can't believe we survived that. But I'm so excited to have you on the show to really have a great discussion about what happened. But through, you know, an economic lens, a financial lens, because now we have more data and we have we do have a little bit more space from what originally happened to really recount what happened, what worked, what didn't, and what were some of the outcomes? Because I thought was

so interesting. Your premise of the book was, you know, really, especially looking back at, you know, the 2008 financial crisis, things were very different this time around for the better. Overall, people did better coming out of this crisis compared to 2008. Thank goodness, because I'm a millennial and that had a big effect on me and my trajectory. So I was really, when the pandemic started, I'm like, oh gosh, not again. I was just getting my bearings. And I think a lot of people felt the exact same way. So I'm really excited to dive in.

But before we do, do you want to share a little bit more about who you are, what you do, and also what gave you the inspiration to write this very important book? Sure. So I'm an economist at the U Consumer Financial Protection Bureau. So that's a agency that started after the 2008 financial crisis, to really to address some of the problems that we've seen then. And I should say, I'm not here today representing the Bureau. So these are my opinions, not necessarily those of the Bureau. Well in some ways, sort of going back, March 2020 was a really traumatic time for a lot of people. And it was certainly for me included. I had a four and six month old at the

time. And suddenly they were home from school. And there was this new virus, and we weren't sure what was going on. Lots of people lost their jobs. For me, professionally, it was also sort of a scary time, because one of the things that I do with the CFPB, and I do professionally as an economist, is study how people react to bad economic shocks, and how prepared they are for those shocks. And one of the things that I do really carefully is I do a lot of surveying. And it was just one of the things that we found really sort of surprising, but also just very much in the data, was that before the back on expenses after no more than a month if they lost their main source of income. So in March 2020, I was trying to deal with all of those personal fears, but also the big professional ones of, is this going to turn out to be another Great Recession, another depression even. So I, as a good economist does, was staring at the data trying to find out, okay, when is the shoe going to drop? Who is going to be having the biggest problems? And through that summer, it became clear eventually that the story,

at least in the United States, was that the shoe wasn't going to drop, that people actually were better off financially in many ways than they had been a year earlier. And I should say that's not true for everyone, but it's true for, on average, it was true for many people. And that was a big surprise to me anyway. And so trying to understand what caused that surprise was something that I at the CFPB, and then I spent a lot of time on trying to advise policymakers. And then I thought it'd be really important to help other people understand the story of what was going on. Traumatic time, but maybe there's some silver lining. No, just to touch on something you mentioned, you know, most people and I think the same was for Canadians as well, even though we're different countries, there was a lot of parallels.

Basically, the same thing happened over here. And what I thought was interesting is you mentioned that most people were not prepared for a crisis. Do you think people should be? Because even though when people really look at history, it's like, yeah, this kind of happens in a cycle every 10 years, something really bad happens. We don't know when. We don't know exactly to what extent or what will cause it, but something bad always happens every decade or so. Do you think it's a matter of people not realizing that and not being prepared for it? Or is it just that there's no room to be prepared?

They're just literally paycheck to paycheck just trying to survive. And so what a luxury and privilege it would be to have so much money to actually be prepared. Well, that's a hard, I think it's some of both. And so the joke among economists is that you wish for a one handed economist who doesn't say on the one hand, on the other hand. So two pieces. One is that having some having a liquid cushion, having something that can help you absorb shocks is just really important. And we see that just repeatedly that people who have that kind of cushion are just able to avoid really costly things that happen to them. And so don't sort of end up in bad cycles. At the same point, that's really hard. So this is true both in the United States and Canada. Housing is really expensive. And that's the big part of most people's budget is just going to housing yourself and your family. And you don't have a lot of control over that.

It's not as if you can sort of cut this cut spending on housing by a huge amount in easy ways, you need to be someplace close to your job. And maybe that changes a little bit with remote work, but it's not. So the ability of many people to cut spending and to have that big financial cushion is limited. But I think one of the things that we learned over the years of the pandemic is that for lots of other people, there is actually a lot of room for cushion. So just to give an example, spending went really went substantially down starting in March 2020. This is true across the world. The best data I know is in the United States about that. But for many places, as much as 50% for several months. Now, there's lots of costs to not spending.

There's lots of just, you know, not doing the fun things like going out to bars and restaurants or visiting your grandparents or grandkids or whichever generation you are. But what it does suggest is that for many people, there is room in their budget to do some cutting. And the data suggests that if you were able to do that, and if you were able to have a buffer of savings, you can really sort of avoid a lot of bad outcomes. I'm also curious what you think. So, you know, there's that saying that, you know, this time is different and it never actually is. But this kind of time was, I mean, yeah, there's lots of similarities to

other crises, but this time really was different in lots of respects in that, you know, you kind of give the example, you share lots of personal or not personal stories, but stories of real people thinking that, gosh, this is going to be just as bad as 2008. I'm going to have to cut back. I'm not going to be able to pay all my bills. And then a bunch of policies were made and benefits were handed out. Same thing happened in Canada with we had CERB. And it was able to keep people afloat so they can keep on paying their bills and survive. And so that was a big, I think, difference between 2008. Do you think that was consciously done because we didn't want to see the big after effect that we saw in 2008 where it took, I think you gave an example in the intro that some people, it took them that decade just to

get back to the pre-2008 crisis level. And then here we go, another pandemic. And, you know, I feel like I can't move forward. What was surprising to you when you were going through the data and looking at the differences between these two crises that had a big effect on people? What were some of the biggest surprises that you saw? Well, I think the big one is, of course, that just on average, financial well-being, credit card, however you want to measure it, sort of financial status, financial health went way up or went up pretty substantially during the pandemic, which was a big surprise, because by all the same measures, it would have gone way down during 2008. And going back to kind of like, there were two really important

differences that in 2008, just the policy response was just not sufficient to the problem. So one of the big things that happened was that even after things bottomed out, and for at least the United States started growing again very slowly in 2009, long-term unemployment, people who were unemployed for a year or more, just continued and continued and continued. And I know I keep on saying that, but if you are looking for a job and you haven't found one, that's just a really, it's a really hard thing to navigate. Whereas in 2020, there was a really big and really important spike in unemployment. And that was hard for many people. But at least the United States, unemployment insurance, partly from policy, really kind of helped keep people more or less whole.

I think Canada has a somewhat better overall unemployment system. So sort of we didn't it didn't require a huge change in policy to make that happen. But what that meant was that sort of that this change in unemployment wasn't a huge, huge problem. And then things just rebounded really quickly. And they rebounded in ways that were kind of complicated, because it's not as if the virus went away after June 2020. But restaurants were able to start reopening and people were able to start coming back and actually doing work again. And so the recovery from the pandemic was just much quicker in unemployment. And in fact, really excitingly,

at least in the United States, we are now back on trend for GDP. So the economy looks as if pandemic never happened, whereas there was a permanent reduction in the United States of about 10%. And that's 10% every year. So I was doing a calculation that that's something like $28 trillion worth of lost output from the Great Recession. Yeah, it was wild for me to live through and see how quickly the rebound was, because I really did think I'm like, here we go again, it's going to be a very similar situation. But then as we saw, especially to, you know, looking at the stock market, and everyone's like, Oh, gosh, this is gonna be terrible. I lost all my money. And I was telling people do not touch it. And what did we see like quickly, like 2020 2021, we're great years to invest, which is not exactly something that you know, we could say for 2008, you had to wait a long time to get those kind of rebounds.

I will admit, I wish I'd been able to call that as well. I know. Yeah, that was a surprise. I'm like, oh, gosh, this is it. And then I'm like, oh, this was a shock. So I'm curious, too. I think another really key difference, and we haven't really touched on it, too, is for the lucky people who didn't lose their jobs, that weren't laid off or anything like that. And then they were forced to start working from home and kind of, and a lot of people figure that out really quickly, which is funny, because I talked to so many people, including myself and, you know, worked at different organizations, they're like, we just don't have the capacity, we don't have the resources, we don't have the tools, the systems to figure that out. So we're just not going to and, and then people figured out in a couple of weeks via zoom, right? And that crazy and then and that's still a thing that we're kind of dealing with. Do you think that had a really big impact? Well, so of course it had a

large impact. And let me kind of break that up. If the same thing had happened in, say, let's say 2000, but maybe even 1990 to go all the way back before where the way you would have had to communicate would have been picking up a telephone. I'm not sure. I mean, I lead a team that we do a lot of really complex surveying. We had a survey that was going into the field in May 2020. And then we had another one that we rushed out to what rush to be able to get out in February 2021. These are complex things. I don't know that we would have been able to do that just through telephones with us all at home. And so in some ways, kind of the technology was there. Was it there 10 years ago? Maybe. I was using Skype calls 10 years ago. It probably wasn't there 20 years ago. And so in

some ways, kind of this pandemic really did change because suddenly there was a large portion of us, of the workforce that could go, that could just go home. And it turns out could just go home and be more or less as productive as they were before. And that's really, in some ways, just exciting because it opens up so many opportunities of what work can look like in the future, in the sense that sort of work doesn't have to be done all the time in the office. People can live in different places, don't have to live in where the housing is most expensive, don't have to, maybe when your wife or husband or partner gets a job someplace else, maybe you don't have to quit

to follow them or the reverse. It just opens up so many really exciting possibilities. And all of those were sort of opened up partly because we had this forced experiment. Everybody was going home and we were all making the best of it. And it turned out we were able to do it pretty well. In fact, really surprisingly well. Yeah, I'd say like the silver lining of the pandemic was that it forced these companies to have to address the work from home issue that I think a lot of employees really wanted. But I know also, and you've probably been seeing this a lot too, there's still especially like the big corporations are really hammering home, please come back to the office. Why do you think that is? Like, in my mind, it's literally because they are holding on to leases of buildings and they don't want to

waste money. But I'm like, I don't know, sublease it. I don't know. Well, yeah. So I think a lot of it is that, and this is partly, I think, generational, that when you grew up as a manager, managing by walking around and seeing whether people were doing work. And that's how you manage. And that's how you think about kind of that. Yeah, that in that. So in some senses for them, kind of seeing people in the office is the way that you say you can tell whether people are productive. And so I think that there's a little bit of just a management that a lack of management

insight that's happening. To be fair, I think there is something that is lost when we don't ever see each other in person. And so just building trust, building kind of communication is harder when you're doing it in a sort of a small screen than if you are able to get together. But honestly, you can probably do that by quarterly get-togethers. That's probably sufficient. And all the rest of it, people are probably more productive

when they aren't being bothered and don't have an hour commute, which is really dead time. And I think that's one thing that gets missed in this return to office, that what effectively is going on is that employers are saying, we deserve another hour of your day, but it's not going to be a productive hour of your day.

You're just going to have to spend it driving in or on the subway. And workers are saying, well, but wait, I want that hour. And in fact, I'll even use some of that hour to work for you. But that's dead time to both of us. And so it's sort of how to negotiate over that hour of time is I think the really key thing that employers seem to be missing, that they're actually asking for a lot more than they seem to be for no obvious return to the employee. Yeah. And I guess that's probably why we've seen a lot of like those trends of the, you know, the lazy girl. I don't know if you've seen this on it, but there's like, like lazy girl worker or whatever it's called, or like the, you know, quiet quitting and all that kind of stuff is a little bit of a pushback to some of these, you know, why are we doing things just because we've always done them? That's not a really good enough excuse. And, you know, there's a now we actually have data and proof that this does

work. And like you said, there's so many different alternatives if it's really about like team building. Well, you know, I think it'd be better to get a quarterly actual like day of team building instead of just come to the office where then you're at your cubicle alone. And then maybe you'll talk to some people at the water cooler a little bit, you know. So there's definitely definitely some options. I know we also touched on the different policies that, you know, were put in place and helped people, a lot of people, especially who, you know, are, you know, low income people in general that were kind of ignored and, you know, not taken care of during past crises. I'm curious, was one of the perspectives you had, bringing some of this data and writing your book, making a case for universal basic income,

or at least just getting people to think about, maybe we shouldn't just create these policies when there's a crisis. Maybe these policies should always be in place. I think that's it. So that's really important in sort of thinking through the various policy options. So in many ways, kind of when you have a big crisis, you should really think through what should we be doing differently. And I think there are several different pieces we can think about. For me, at least, the obvious low-hanging piece of this is for the United States just to have a better unemployment system.

So every time we have a crisis of a sort of financial or we tend to increase unemployment in some ways, this time we did it a lot more extensively. And it turns out to have really big, important impacts. And there's no reason why that has to be kind of limited to, oh, there's something big. We can make that sort of more or less permanent. And what's really good about that is it means that it's what, in the economic speak, is what's called an automatic stabilizer. What it means is that there's money that goes into people's pockets,

and people who need it because they're unemployed, when there's a recession or when they're having problems. And so it sort of helps to kind of keep everything kind of fairly even. So that's kind of a really basic, that's just sort of basic social insurance. Going to the next step of whether we want to have a kind of a universal basic income, that's a little harder, because in some senses, a universal basic income, especially one where you would actually be able to live on it, in the sense of sort of like, this would actually be a basic income that you could live on, that's a lot of money. And it would require a real change in the way we tax and the way that we think about benefits. Effectively, it would mean that lots of

people would get a lot more, would need to be taxed somewhat more. And whether that's something that the United States wants to do, or is a little bit stronger. But sort of I think the case for not making kind of the ups and downs of income be as big is really important. And just to be clear, I'm not arguing against universal basic income, but I think it's a complex, it's a more complex and more and more complex political problem. Yes. Yeah. But in some ways, what the pandemic did show is that when you have people who are financially secure, they're going to do good things with it.

I know. So the example I love is that businesses, the new business creation just boomed starting in the pandemic, and it's still high. And a lot of that comes down. You can kind of trace it to sort of new business registrations in the United States increased right after there were big money, sort of the economic impact payments, the stimulus payments that were part of US policy. Then people started new businesses. And that kind of economic dynamism is really exciting. It really does show that maybe kind of having a better, having more people just be better

off financially and with access to capital can lead to big and exciting economic growth things. And it makes it makes the people who have access to money and have a better financial better off. And so kind of those things don't have to be opposed to each other. Yeah. And like we saw to a lot of jobs and roles, we kind of saw them in a different light, like, oh, these are essential, these essential workers, nurses, you know, people who worked at restaurants and grocery stores. And, you know, there was a little sometimes a little boost, sometimes the grocery stores, you know, okay, we're upping our hours, because we're trying to get people in because they are literally risking their lives just to serve you, you know, food or to help you at the hospital.

And then once things kind of started getting a little safer, Pandemic was over, we kind of forgot about all of that. I mean, I am seeing definitely increased our tipping percentages here in Canada. Everything used to be like starting at 15 percent, then 18, 20. Those were kind of the options. Now everything almost starts at 18 percent and lots of other, you know, businesses are putting that tipping option when they didn't previously. So that's like, I guess, one way they're trying to, you know, increase the incomes of some of those workers. But I mean, yeah, it's just one of those crazy things. You're like, did we all forget how important these people were? And then we're not trying to find another way to support them by maybe, you know, making the minimum wage higher or creating some sort of benefits or something like that. But like you said, the money has to come from somewhere. And a lot of the people that we'd have to tax are, you know, they're, you know, very, they're up there, and they have their influence with the politicians. So it's going to be a long road. I don't think they want to let go of that money. But I think you do bring up a really excellent point that sort of there were some real unfairnesses during people who were not earning a great deal of money and were suddenly

exposed to a huge amount of more risk, in the United States that actually showed up for a while, many of them would have been better off financially, at least in the short term, if they'd been fired, because the way the unemployment sort of worked was that they actually would have had slightly higher incomes and wouldn't have had all the risk. That's a really unfair situation. And it's not one that you want to sort of create if you're not doing something in a crisis, to sort of think through how do we make things so that people who are taking risks are compensated for it. And people who are employed, I don't know, if you're going into to do groceries, that you're not that that's not sort of an imposition, that that's not being unfair to you. Yeah, absolutely. I know one stat that there was that I found shocking was child poverty specifically. So it has doubled in 2022, but it declined in 2021. What it did is it first it

increased overall earned income tax credits for dependents. And it also meant that they were also prepaid. That's not quite the right word. They were sent out monthly rather than when you file your taxes, you get the full amount back. And that money directly, just the way that child poverty is measured, meant that the families with children who are not earning a lot of money had a substantial amount more money. And so child poverty just went down almost directly because of that. And then that policy ended. So it was only funded for sort of six months, and then stopping.

And it's really sad that sort of when the data is clearly showing it's like this works. Why did we stop it? Because now that we stopped it, we can see the negative consequences of getting rid of that policy. And I think the evidence is fairly clear that particularly for children, kind of poverty is just, it causes long-term problems. I mean, that's not to say that poverty is pleasant for anyone, but for children who are sort of forming their education, who are, maybe they aren't getting enough to eat and that can have long-term consequences. And it really affects kind of their approach to lots of things.

100%. Like the psychology of it, like it affects them at a really granular level. Like, you know, obviously it's like affects them in that they're not getting their needs met. But I mean, talking to adults who, you know, had scarcity growing up, it comes with you and it's hard to shake.

It's really hard to shake. Oh, gosh. I'm curious because, you know, we talked about how there's some big differences, you know, like this time was a bit different than the last crisis. Some people, you know, weren't that especially really low income did better compared to that time. But I was kind of just looking at, you know, some of what I've been seeing online and in the financial news. Was it still, though, the situation where the rich still got richer and the poor did better than last time, but they still aren't great? I mean, they're still at where they're at. And then maybe the middle class

still did better than than expected. Yeah, well, I think it's it depends a little bit on how you look at it is I think kind of always the so the partly because the stock market came right back. It's had not such a great year the last year, but sort of the the data has been pretty clear that just overall, the wealthy got a lot wealthier, which, okay, I mean, but what's really exciting is that the poorest half of the population also got somewhat more wealthy. And in some senses, that matters more in the sense that sort of the people who are hurting were hurting a whole lot less on average. And I keep on saying the on average, but I think that it really does matter. In any economy, there are going to be people who are not doing as well.

That's true even when sort of all boats are floating, some are going to be being hit by waves. And so just acknowledging that it isn't necessarily true that everybody's doing well. So recent data that came out from the United States did suggest that wealth at the top end increased by a huge amount. Wealth at the bottom end also increased, and the dollar value didn't increase a huge amount. But in percentage terms, it increased by a huge proportion,

largely because, at least in 2019, many people in the bottom 50% of the distribution didn't really have much net wealth. I think the average was about $400 in 2019 in terms of median wealth, which is not a lot of money. And so when that increased to about $3,600, that's a big increase. And it's a big increase in the cushion that allows you to sort of just absorb some bad things, your car breaking down. So obviously, you've done a ton of research for this book. I'm curious, while you were, you know, doing some of those surveys, especially during 2020 and 2021, and seeing some of the data come in, were you surprised by some of the kind of narratives that were being promoted by the financial news? Because, you know, sometimes it's the financial news doesn't get it wrong. And they also, you know, they're kind of

just doing their best in terms of trying to report on real time. But looking back, was there anything that they got substantially wrong that you want to correct? Or you're like, oh, gosh, I can't believe it's not quite the full story there. Oh, that's an interesting. So first, just to admit that we were all trying to figure it out. And one of the things that was both interesting about being somebody who was studying these things, but also just that everything was real time. Everything was changing. You couldn't depend on what you'd sort of looked at last quarter still being true. And so trying to figure out what was going on, I think was a really, was really important. And

I think there were a lot of financial journalists who were paying a lot of attention and were thinking very carefully. And we all got it wrong in the real in real time on occasion. And some some got it more, some got it better than others eventually, and some didn't. So, kind of maybe several pieces of this. One is, I think, and this was an emphasis of writing the book, that I think just missing just the general improvement in people's financial lives. And that's the fundamental story. And that everything else is understanding who wasn't benefiting and understanding kind of maybe who was benefiting more, who's benefiting less, did inequality increase, but that overall financial lives were a lot better is I think really important. Yeah, that's certainly not something that I'm seeing in the headlines that like, actually, things are better now. Because I mean, that's not really an exciting headline. But I'm curious even to your perspective on now that we're almost at the end of uh 2023 as

we record this i mean things have changed taken a turn definitely the past year year and a half since kind of the high highs of 2020 and 2021 where things are you know we've got you know cross cost of living crisis high inflation have things have things kind of rolled back a little bit since we saw some of those improvements in people's lives? Are they now kind of overcorrected? Now those people are actually worse off than before. So things have definitely rolled back. And I think the hard question that I think we're all trying to ask ourselves at the end of 2023 is, are we looking at something where people are going to be worse off than they were? Or is this just a return to kind of normal? And normal might look a little different than it

did before. In particular, I think housing costs have just... Incredible. Housing has just gotten much more expensive. And housing is the biggest thing that people spend on. And so when housing gets more expensive, that just affects everything else. And the big question I think right now is, are we going to go back to where things were or even get, are things going to even get worse for a little while? Or are we going to just sort of stabilize? And maybe to give a little bit of context, so just to be clear, I'm speaking at the early November 2023

because I think that the timing of that matters. As we were just saying, real-time things change. Credit card delinquencies, which are a good way of measuring things, are about where they were or even higher than they were in 2019. And that's a good way of saying, okay, there are some people who are having some problems. Is this widespread? Well, maybe not. But unemployment, at least in the United States, unemployment is still quite low.

It's been increasing a little bit lately, but it's still quite low. I think my hope is that sort of things are just going to stabilize now. Actually, I would hope that things are going to be much better for much longer. That's not where the data is right now. So I think that things are going to say, my hope is that things aren't going to get worse. But unemployment is still low. And so if unemployment starts spiking, maybe things will get a lot worse. And that's really scary because it really does suggest that the overall increase in prices, particularly for housing, are going to impact people a lot.

And all of those pandemic policies, those have ended. For a long time, people had a lot of savings built up. That's kind of gone. It's not entirely gone. It depends on who, but I think that the bottom end of sort of the wealth distribution has less than they did, not necessarily less than 2019. But so trying to predict kind of where the economy and where individuals are going to go, it's become a lot harder than it was.

Like a lot of the people who were able to stay at home and save their money, I think they spent a lot of it the next year when things started opening up. Hence why we're in the situation with high inflation and we need to raise interest rates to kind of incentivize people to stop spending money. It's funny, just going back to kind of what we talked about at the beginning of this episode, the idea of having that buffer. Do you think even though like it's so fresh in our minds, the pandemic, 2020 wasn't that long ago, but do you think that people, again, we're kind of like goldfish. We have a really short-term memory that a lot of people aren't thinking like, well, we got out of this, kind of unscathed, but maybe that was a lucky situation.

I should do my best to put those protections in place, get that emergency fund, all that stuff. Do you think people are thinking like that? Or do you think that people are people and they're just going to do what they want to do? And it's, you know, kind of on repeat, they will or they won't. Let me divide up what I wish was happening, what I think what I what seems to be actually happening. Yeah, there were some surveys kind of in 2021 and 2022, which suggested that people were more interested in having more savings around. The average behavior since then has not suggested that that's been the kind of the dominant behavior for kind of the average consumer, that just the increase in price, the combination of the increase in prices, and just having more money in the bank or less credit card debt. People have been spending as if they sort of as if they just

have more than they need. And we're down to a point in early in late 2023, we're kind of, that's no longer true. And so they're probably going to have to stop spending as much as they were. The person who would have liked to have seen more savings and more kind of financial protection individually, what might have hoped that sort of that some change in behavior had kind of continued and more people had sort of realized, gosh, you know, I didn't need all those trips to the bar or to the restaurant. I can do things that are a little less expensive. You know, there are some benefits of meeting friends in the park,

which was sort of a COVID thing. Yeah, I miss those. Well, I mean, and, you know, do we get in, it doesn't have to be very costly. Yeah, it'd be creative, you know, and I feel like we forgot, you know, we just immediately, like, it's so crazy how we changed our behaviors pretty quickly to adapt to the new world that we were living, living in COVID, all these restrictions. And then once the restrictions left, we were very quick to go back to our old behaviors. Yeah, well, and revenge

spending, I think is the term that people were using it or sort of revenge vacations or that, okay, I didn't get to take that vacation for the last two years. Now I'm going to do it. Now I'm going to sporge on it. Yeah, I'm going to do it twice as good now. And you're like, that defeats the purpose of you saying, come on, you know. And to be fair, I mean, kind of, you didn't get to take that vacation. So I don't want to, this is not to criticize people's behavior. But I think that one of the things that sort of stands out is that, say, going all the way back to 2019, even very high income people sometimes had difficulty paying bills even high even high income people didn't have a lot of kind of uh buffer in their sort of weren't you know if they

lost their job didn't necessarily have a lot of money in the money to kind of back that up and i'm picking on high income because in some senses that helps sort of divide up is this, there's just no margin, or is it a choice about how much you're going to put into a financial cushion? And going back to the two-handed economist, it's some of both. But I think there might have been some benefit to having more savings around. Yeah, there's always a benefit to having more savings around. So if anyone can take that lesson, it's like, don't, you know, just forget immediately what happened in the past. I always tell people, it's like, if you feel like you don't have a foundation, or you don't know where to look, look at history, it will, and you'll see how often it repeats. And some of the lessons

of the past, the really just basic ones, like have that emergency fund and put those protections in place, have that insurance, all that kind of stuff. You'll never regret doing those things. So I'm sure I can talk your ear off. But you know what? You did such a great job with your book. I'm really glad that you wrote it. I think it's such an important book for people to read, especially, again, to really hammer home some of those, remember what we learned at the pandemic. Let's not forget what we learned. So thank you so much for coming on the show. Where can people, I guess, grab a copy of your book and maybe find you online if they want to follow you? Sure. The book is The Pandemic Paradox, How the COVID Crisis Made Americans More Financially Secure. And it's available at all major booksellers, including Amazon and

bookshop.org. I'm on LinkedIn at Scott L. Fulford and at my website at Scott Fulford dot com. Amazing. Well, thank you so much, Scott, for coming on the show. Love having an economist on. I'm always like nervous. Like, I hope I can, you know, have some good questions, but I think we had a really great chat. So I really appreciate you coming on here. Well, I will admit I'm always a little bit nervous as well. Am I going to give the economist jargon answer? Can I remember? Oh, no, I need to actually give the answer that doesn't involve weird Latin and Greek words. I always appreciate that. My Latin's just not up to par.

So thanks again for coming on the show. Thank you. And that was episode 387 of the More Money Podcast with Scott Fulford. Make sure to check out his website, scott-fulford.com. You can also follow him on Twitter or X if you really want to call it that, at scott-l-fullford. And of course, he's on LinkedIn as well. I will link to everything in the show notes for this episode, jessicamorehouse.com slash 387.

If you want to find the show notes for any episode, if you want to find out more about a guest, just go to JessicaMorehouse.com slash podcast. But also, if you go to JessicaMorehouse.com slash whatever the number of that particular episode is, it will lead you right there. And honestly, I do not mind if you email me or DM me on Instagram. Be like, hey, there was that episode with this person that talked about this subject. I have no idea who it is. Can you help me? Point me in the right direction. Yeah, because I remember every single person. 387 guests. Yeah, I think that's, I mean, maybe there's a few solo episodes in there, but I've talked to a lot of people. Remember every single one. So yeah, you can hit me up. I will let you know. Also make sure to grab a copy of his book, The Pandemic Paradox, How the COVID Crisis Made Americans More Financially Secure. And I will be sharing details in a moment about how you can win a copy and some other important things that you're going to want to stick around for. So do not go away.

This episode of the More Money Podcast is supported by The Globe and Mail. Want to finally get a better handle on your debt and spending this year? Or maybe you want to stop feeling so intimidated by all the financial jargon and terminology that's thrown around all the time. I've said this on the podcast countless times, but I'll say it again. One of the best investments you can ever make in yourself is by expanding your financial knowledge. And one resource I've always turned to for staying up to date on financial trends and news and expanding my own knowledge is the Globe and Mail, Canada's leading source of business and investing news. Not only do they have a plethora of personal finance content by top financial journalists like Rob Carrick, Erica Alini, and Salman Faruqi,

but they also have helpful calculators, podcasts, and explainers on everything from how to invest when you're just starting out to how to pick the best robo-advisor. And for a limited time for more money listeners, the Globe is offering unrestricted access to globeandmail.com for just $1.99 per week for the first 52 weeks plus tax. For full details, visit tgam.ca slash Jessica. Once again, that's tgam.ca slash Jessica. Okay, so first things first, I have officially closed the big book giveaway that I did for season 17. So if you did not get an email from me saying you were a winner, you are not a winner. But that's okay, right? Because every season I do another big book giveaway, including this season. So if you want to win a copy of The Pandemic Paradox, then all you have to do to enter to win is to go to jessicamorehouse.com slash contest.

And I update that page weekly when I have a new episode, a new guest that has a book, I will update that. So make sure to check that out. You know, every once in a blue moon, and you can enter to win all of them. You will only, of course, win one of the books. But yeah, that is how that all works. And you know, contest details are on that website as well. So jessicamorehouse.com slash contest is where you can find all of that. All right, so some other fun things, life update, blah, blah, blah. Obviously, share the big news at the beginning of this episode, finish the manuscript, head it in. That's very exciting. I was also able to take a little time for me, which is important, right? It's not all about just saving, investing, and grinding it out and then burning out. We've

all done that. I mean, I've done that. We don't want to do that. Vacations are important or just time off. Staycations are great in this economy. Yeah, me and my husband saved up all year and booked it pretty much a year ago to go to Mexico because we have not done like one of those resort vacations for like, I don't know, since 2018, I think. And we did that first week of January and it was lovely. And now I'm good for like another five years. I don't know about you. I love it. I love going to a resort. It's beautiful. It's exciting for like the first two days. And then like the middle two days are like, because we went for five nights, two nights, you're like, okay, now what? Like, we get a little, I don't know,

get a little, I feel like I'm supposed to be doing stuff. And like, we've done as many excursions as we, you know, like, and we've seen Chichen Itza, we've seen everything. And we did do some jet skis for the first time, which is really exciting and also terrifying because I have some trauma related to driving and my husband is terrified of water and can't really swim. So that was a choice we made and we had fun, but I don't know if we'll ever do that again. I can't believe we almost considered doing parasailing. I don't think we're at that level yet. We have to work our way up to that. But it was nice, relaxing, took a lot of great naps, read a couple great books, had some food, some drinks, did a little of great naps, read a couple great books, had some food, some drinks, did a little silent disco party. That was actually really fun. If there's ever

a time, you know, maybe in the future when I'm doing these, you know, book, what's it called? Oh my god, like my brain book launches. If there is a way that I can have integrate a silent disco into it, I will because it was one of the funnest things I've ever done in a very, very long time. Super fun. So that was a little snapshot of what my vacation was like. Super fun. And also you may or may not know this. If you follow me on Instagram, make sure to follow me at Jessica I. Morehouse. Also, there is an Instagram for the podcast at More Money Podcast. But I think I just shared a story because it's not really a thing yet. It will be a thing in like 12 to 14 months. But I'm going to get a dog. I'm going

to get and you're going to probably laugh because it is a ridiculous type of dog. I'm getting a corgi. Listen, I just like them a lot. I've looked at so many dogs. I've read dog books to try to see like, what is the right dog for me? This is my dog. It's short, it's fluffy, and it's just ridiculous and cute. And I can't not squeal whenever I see one. And so yeah, we're gonna get a corgi and this is happening in like a year's time. So that's exciting. Oh, yeah, the other more podcast related news I should share, and I think maybe I shared it on like the last episode of last season. I can't remember. But anyways, this podcast is going to become a video podcast because that is just where the podcast

world is going. And you know, if you're a longtime listener, then you know, I tried doing a video podcast back too early, quite honestly, maybe it was, I don't know, 2017 or something. And it was way too much frickin work. And the technology was not there. Let me just say that the technology was not not good. And no one cared. Like no, I wasn't like, oh, I got so many. No, it was maybe too early. And anyways, cut to now 2024. And it's time. It's time to revisit. Luckily, I do have a video editor. I have my podcaster. I've got a team to help me with this. Thank goodness. But yeah, next week is going to be the first video podcast. So of course, you can continue listening wherever you listen. But if you want to see what it looks like, you can do so I'm going to be posting clips, of course, on like my TikTok, my Instagram, YouTube, but I'm going to also have the full length episodes on my main YouTube

channel. I did have a podcast YouTube channel. But now YouTube allows you to have like a podcast within your, you know, YouTube channel. So might as well you to have like a podcast within your, you know, YouTube channel. So might as well just put it on the main channel. So that is where you can find that. And you can, you know, find my channel, JessicaMorehouse.com slash YouTube will direct you right there. But honestly, if you just go into YouTube, Google my name, Jessica Morehouse, you will find me. And hey, over the holidays, I cracked 25,000 subscribers. So we're getting there. I mean, we're far away from that 100K to get that stupid plaque.

But I'm going to get that plaque if it kills me. I'm going to get it. It's happening. So to use who is going to be on the show next week, I've got Jeremy Saunders from Sick Boy Podcast. I was actually on his podcast late last year. So I don't know, maybe a month ago or so. We had such a good chat.

It was like one of my favorite times being on someone else's podcast. And of course, I wanted to have him on my show. We're going to be talking about the cost of health care. Jeremy has cystic fibrosis, and that is a big part of his story. And I think it's a really important topic that I have not explored on the podcast ever. So we're going to talk about the cost of health care. And also when you do have an illness, a disease, a disability, how does that affect your finances? Spoiler, it has a huge effect on your finances. And so you're going to

love that episode. And with that, thank you so much for joining me for this episode. A big thank you to my podcast team, Video Edit by Justice Carrar and produced by MRAVCanada.com. Shout out Matt Rideout. Thank you. And I will see you back here next Wednesday. This podcast is distributed by the Women in Media Podcast Network. Find out more at womeninmedia.network.