This recession will be different from past financial recessions because this recession is caused by a pandemic instead of a financial blowout.
The governments have to deal with a virus outbreak and an ensuing economic crisis from the outbreak. Furthermore, we cannot find a pocket of growth in the world now compared to the past. Where is the area of growth?
Europe? Recession!
USA? Recession!
China? Recession!
ASEAN? Recession!
Middle East? Recession!
In the 2008 financial crisis, China pulled the world out of recession when the US housing crisis decimated the world.
In 2020, the pandemic decimates the world leaving no region unscathed. Furthermore, global debt has reached US$260T which is a record high. We cannot continue to pile up our debts without repercussions. The day of reckoning will come one day. Even if it doesn't come today, it will come tomorrow.
https://www.reuters.com/article/us-global-debt-iif/global-debt-shattering-records-iif-idUSKBN1ZC1VQ
Therefore, it will be much harder to pull the world out of recession this time.
Subscribe to:
Post Comments (Atom)
1 comment:
The US can lessen the financial stresses in the world by pacifying the Saudis to stop increasing its oil production.
When the oil price is closer to US$50, the US shale oil industry will be saved and this will take a lot of stresses out of the economic downturn.
Post a Comment