There will come a time when you believe everything is finished; that will be the beginning.
Human existence and triumph is testimonial to his never ending perseverance and ability to adapt, seldom we triumph because of extraordinary capabilities against the mundane virtues of perseverance.
COVID19 will change this planet forever, a new paradigm will evolve and new parameters will be standardized, human ability to adapt will surprise all naysayers.
World Economy is going through an unprecedented recession and coming 2 quarters are going to be very difficult for the whole economy yet the human spirit and need to survive will finally come along and bail us out but not before we see massive layoff ,retrenchments chaos and finally a looming world war .
No government can absolve herself from this situation as unemployment will not impact not just the market sentiment but will also show increase in law and order related issues, thus the stimulus is not far which won’t ease the pain but will definitely help the entrepreneurs to come out with out of the box initiatives which always come out of turmoil in each century.
Artificial Intelligence ( AI) is going to play a big role in coming future and this pandemic may be the trigger point to bring it out of the future to present with much more emphasis on technology footprints and it’s inherent capability to clone cookie cutter experiences.
AI will not only add on to the chaos but will also increase the pain of unemployment which will be a definite reality in coming days, our emphasis to remain stagnant and in comfort zone will add up to the recession and we may witness the repeat of 1929 depression which lasted for 15 years and gave us two world wars.
The Great Depression had devastating effects in both rich and poor countries, personal income, tax revenue, profits and prices dropped, while international trade fell by more than 50%. Unemployment in the U.S. rose to 23% and in some countries rose as high as 33%
Irving Fisher argued that the predominant factor leading to the Great Depression was a vicious circle of deflation and growing over-indebtedness.
He outlined nine factors interacting with one another under conditions of debt and deflation to create the mechanics of boom to bust. The chain of events proceeded as follows:
- Debt liquidation and distress selling
- Contraction of the money supply as bank loans are paid off
- A fall in the level of asset prices
- A still greater fall in the net worth of businesses, precipitating bankruptcies
- A fall in profits
- A reduction in output, in trade and in employment
- Pessimism and loss of confidence
- Hoarding of money
- A fall in nominal interest rates and a rise in deflation adjusted interest rates
A cursory look up on these 9 points should send shivers down to our spine as we are at cusp of another century changing circumstances, Let’s hope we shall not go through what our forefathers went through exactly a near century back and the new beginning I spoke of at the start of this article comes with our individual existence intact and not at the cost of it.
My moot question is Are we ready to accept the reality ?
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