Topic: Causes of downtown in the modern Economy - page 2. (Read 256 times)
I think, that we have not yet seen a real crisis, which is about to begin. Now everything is very shaky and there is a premonition of the beginning of a long-term bearish trend on american stock exchange. This is exclusively my opinion that can be discussed.
Tighter monetary policy and rising interest rates will restrain domestic growth and reduce capital flows to emerging economies. The capital flows that were searching for yields in emerging economies when interest rates in high-income countries were close to zero will likely decline, moderating growth in countries with large external funding needs. In such an environment, a cyclical downturn is more likely than further acceleration or even stabilization of growth at current levels.
That slowdown may already be happening. The Purchasing Managers’ Index, which combines various indicators in the manufacturing sector (new orders, inventory levels, production, deliveries, employment), will fall in the region.
Globalization put some countries in the danger zone since countries with the money starts to steal the natural source of a poor country and importing the products to their country by this they are making money and also the country they invested also making some money but its not a complete revenue forever, it only feasible as long as the natural sources exists and the great example for this is African nations.That slowdown may already be happening. The Purchasing Managers’ Index, which combines various indicators in the manufacturing sector (new orders, inventory levels, production, deliveries, employment), will fall in the region.
So any country can't stick to a particular policy, they just need to adopt the best for the people and not damaging the natural resources much.
But currently developing countries like mine are not implementing monetary policy like you said. There are even many relaxation monetary policies to increase market interest in the wheels of the economy. The lowered loan interest rate and even the ease of borrowing at the bank have been regulated by the government. Fiscal policies such as providing cash assistance to the public are propagated by many types of assistance. Foreign investors also keep arriving to provide loans to my country so that it can resolve the bad economic conditions caused by the pandemic.
So when the economic sector of each country is not in a stable condition, the respective governments of each country will carry out several evaluations. namely by creating business opportunities that are able to survive the hustle and bustle of the Covid 19 pandemic which is increasingly unclear in which direction this pandemic game ends.
I think the government doesn't pay attention to this sector, they just evaluate the decreasing income from various business elements and raise taxes based on the capitalization of the increasing price of goods.
I think the government doesn't pay attention to this sector, they just evaluate the decreasing income from various business elements and raise taxes based on the capitalization of the increasing price of goods.
I am not personally worried about a dowturn in the economy.
The market recovered from the 2008 crisis in about 4 years, and in theory it was the second worst since the crash of '29. The coronavirus panic seems to have been a brief blip from which we are emerging.
If you are prepared for crises, you don't worry about them. If you have assets with no debt or little debt relative to your assets and also different sources of income, you shouldn't worry much.
Some say that because of the massive printing, the next crisis may be like the crash of '29 or worse, but that remains to be seen.Another thing is that if a strong crisis comes, many people who are not prepared will suffer, and that is the bad side of the story.
The market recovered from the 2008 crisis in about 4 years, and in theory it was the second worst since the crash of '29. The coronavirus panic seems to have been a brief blip from which we are emerging.
If you are prepared for crises, you don't worry about them. If you have assets with no debt or little debt relative to your assets and also different sources of income, you shouldn't worry much.
Some say that because of the massive printing, the next crisis may be like the crash of '29 or worse, but that remains to be seen.Another thing is that if a strong crisis comes, many people who are not prepared will suffer, and that is the bad side of the story.
The economies that rely on big or developed nations will keep being reliant on them. Througly helping smaller nations will help them grow faster but some third world countries who have detectors and tyrannies as heads of states have also shown that they can survive when relationship are severed with some developed countries. Before the death of Lybian detector (Muammar Gaddafi ), the Ugandan military detector Idi Amin and many more control their government without help from certain countries especially from Europe and America. So tighter policies
may only slow certain nations and make them find ties with others.
may only slow certain nations and make them find ties with others.
Deference in government policy can throw economy into a plum, almost every new government that holds the reign of affairs tries to work according to the policy they think is right, this won't be a problem only if these policies are not adamantly implemented even if with it fails in economy and many more sectors, like @coyster I think the pandemic left many economy with a black eye, mostly private individuals who run their logistics personally and had to close down because of the pandemic.
I don't major in economy nor am I an economist, but I know policies built by government on a country has the highest amount of influence/restricting Factors on their economy, for instant countries like New Zealand that even in the pandemic has a strong policy to tackle it making them manage the country even in the pandemic.
I don't major in economy nor am I an economist, but I know policies built by government on a country has the highest amount of influence/restricting Factors on their economy, for instant countries like New Zealand that even in the pandemic has a strong policy to tackle it making them manage the country even in the pandemic.
Most countries and their economy are already in serious problems as a result of the covid-19 pandemic, thus it was always going to affect their monetary policies/interest rates, especially in the developing countries/developing economy's. Due to some of the policies taken to tackle the pandemic, quite a lot of countries are already on the brink of inflation, thus they have to be cautious with whatever monetary/interest rate policy they apply for them to reduce inflation in their country.
Having said that, it was always bound to affect the developing countries more, as most of them are accustomed to borrowing, but it is what it is, and the only way to rejuvenate an economy is by pumping money into it, but with rising interest rates, loans becomes difficult to take both for micro/macro economics.
That could prolly be why many institutional investors are all of a sudden interested in Bitcoin as it's somewhat an anti-inflationary currency, imo, inflation is inevitable for Fiat currencies looking at how things are panning out, thus corporations/companies are seeking a hedge in Bitcoin, and it makes sense.
Having said that, it was always bound to affect the developing countries more, as most of them are accustomed to borrowing, but it is what it is, and the only way to rejuvenate an economy is by pumping money into it, but with rising interest rates, loans becomes difficult to take both for micro/macro economics.
That could prolly be why many institutional investors are all of a sudden interested in Bitcoin as it's somewhat an anti-inflationary currency, imo, inflation is inevitable for Fiat currencies looking at how things are panning out, thus corporations/companies are seeking a hedge in Bitcoin, and it makes sense.
Tighter monetary policy and rising interest rates will restrain domestic growth and reduce capital flows to emerging economies. The capital flows that were searching for yields in emerging economies when interest rates in high-income countries were close to zero will likely decline, moderating growth in countries with large external funding needs. In such an environment, a cyclical downturn is more likely than further acceleration or even stabilization of growth at current levels.
That slowdown may already be happening. The Purchasing Managers’ Index, which combines various indicators in the manufacturing sector (new orders, inventory levels, production, deliveries, employment), will fall in the region.
That slowdown may already be happening. The Purchasing Managers’ Index, which combines various indicators in the manufacturing sector (new orders, inventory levels, production, deliveries, employment), will fall in the region.
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