During a Reddit “Ask Me Anything” last week, Gates was asked if he thought America would see another major financial crisis. He said: “Yes. It is hard to say when but this is a certainty.”
The financial crisis of 2007—2008, originated with a crisis in the subprime mortgage market in the US, but grew into the Great Recession. Its effects were felt globally for several years and many economists consider it to be the worst financial crisis since the Great Depression. The 2008 financial crisis cost America millions of jobs with many still feeling the after-effects. A decade after the recession, an estimated one in three Americans have not financially recovered, according to CNBC.
While Gates says we should prepare for another such crisis, he also feels optimistic about our ability to recover from such major economic downturns.
“Fortunately, we got through that one reasonably well.”
At the conclusion of the Ask Me Anything session Gates said: “Despite this prediction of bumps ahead, I am quite optimistic about how innovation and capitalism will improve the situation for humans everywhere.”
Gates also mentioned his friend, fellow billionaire Warren Buffett. “Warren has talked about this and he understands this area far better than I do.”
In an optimistic op-ed Buffett wrote for TIME magazine in January, Buffett predicts that, in general, “most American children are going to live far better than their parents did” and that “large gains in the living standards of Americans will continue for many generations to come.”
According to CNBC, Buffett’s 2016 advice is still the best for riding out any economic or financial crisis: Buy, hold, and don’t watch your investments too closely.
Said Buffett: “If you aren’t willing to own a stock for ten years, don’t even think about owning it for ten minutes.”