Lockdown across the world have caused global economy to take a rapid nosedive. It was predicted by some economists that a global crisis was inevitable.
However, one attributed to a natural disaster was not foreseen. Now it is not a matter of if we are in a recession, but a matter of how bad this recession will be, and whether this could turn into a great depression.
To understand the current global economic downturn, we have to first understand the consequences of lockdown on a nation’s economy. People believe that the economy has been simply put on pause like pausing a video.
On the other hand, this is not so far from the truth. It can be better understood as if a video provider goes offline, then unplugs the wifi router, and finally shuts down your computer. To say the very least, the consequences can be harsh, especially for fledgling businesses and vulnerable individuals. So at a time when nations’ economies are struggling, it invariably has a massive impact on the global economy.
Nations have to first get their economies up and running again to recover. It is easier said than done, as the respective country has taken many thoughtful steps to get its economy move again to pre-pandemic strength. 
The situation can vary viz a viz nation’s economies depending upon the approaches of each country. The most optimistic recovery is what is known as a “V” shape recovery, where after a great recession, the respective countries’ economy surges back rapidly.
However, this is very unlikely for most of the nations. The other way certain nations’ economies may recover is what is known as a “U” shaped curve. In a U-shaped curve, a country’s economy heads into a recession and stays down for a few quarters, only then does it begin to rebound rapidly to its pre-pandemic strength.
The more realistic is a “W-shaped” economic recovery, but it is also painful in an economic sense. In this form of recovery, the economy goes up and down in rapid successions as the lockdowns are lifted, and then put back in place once the virus begins to resurface. Finally the most dreaded is the “L-shaped” recovery. In an L-shaped recover, the economy stays stagnant and then slowly begins to recover.
This is not all doom and gloom. This current global economic slowdown allows countries to fix issues in their economy that may have been previously allowed to fester such as the rising inequality, and stagnant wages besides making fail-safe mechanism for future crises.
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