The western world has been hit by a severe recession that was almost going to be a repeat of the Great Depression of the 1930’s. A depression which for many countries lasted for 10 years Today’s recession has clearly been caused by the reckless way in which banks operate and to some extent still do.
Unlike the 1930’s governments around the world took swift action to prop up the system. However has it worked in the long term? We now see some countries having a real crisis, Spain, Greece, Portugal and Ireland and possibly more to follow. Banks and their system of operating may play a crucial role in making it worse as they increase interest rates to ailing countries (the countries where they caused the problems) and speculate on currency movements thus creating more uncertainty in the world markets.
What Does The Future of Our Economy Look Like?
What does the future of our economy look like? There are a number of options. One option is that people and commencing with the banks will start to lose trust in certain currencies creating huge inflation in the those lands where it is used.
Another option is what happened to Japan some years ago and we end up with some major economies stagnating. Interest rates would be low and possibly deflation would occur rather than inflation. This scenario although it sounds better than high inflation can also prove devastating as it is very hard to break a downward spiral. Few new jobs get created and often industries will move away to other countries.
The third option is that we slowly recover and grow out of the recession and start to take back some of the trade lost to China and other countries as their own people start to demand some of the goods and lifestyle that they have been supplying to the western world. We can see that the nations of the G20 have already been looking at redressing the balance of trade to see if they can achieve this.
What Can You Do About It?
Whatever the future holds we can see that we are all reliant on other people to a large extent. As individuals and business owners we can take steps to cope with the situation. We need to make sure that our business offers the best service to our customers and to use every means possible to build a strong customer relationship. It is good too if we have a multiple stream of income so that if one area is not doing so well another area may balance that out. One question we ask is, “Can we trade outside our own country and look to markets where the economies are growing?”
Now is the time to plan and more importantly put those plans into action. The most successful people are those that have speed of action. Once they know something needs to be done – they do it!
With careful planning and imaginative ways of doing business we will succeed no matter which way the economy moves. Are you ready?
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What are your thoughts about the economy and what plans are you making?
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