Recessions have several causes, but one stands out in particular right now. According to the National Bureau of Economic Research, a recession can be caused by an overheating economy where demand outstrips supply, causing price inflation.
That scenario is eerily familiar to what is going on in the U.S. economy right now. Prices are going up broadly for things like used cars, fuel for your car, and vacation stays. Indeed, the U.S. Bureau of Labor Statistics reported the 12-month change in the consumer price index was 5.3% in August.
Although we are just rebounding from a recession caused by the pandemic, the economy can go into another recession not long after. Here’s why Netflix’s (NASDAQ:NFLX) business could perform better than Disney’s (NYSE:DIS) during the next recession.