The health crisis that the world is going through these days affected jobs and businesses, closed companies and airports, and stopped most aspects of life in most countries of the world, God willing, this crisis will be evacuated, but how will the global economy, stagnation or inflation, or will we turn into an economic shock ??
Dr. Nidhal Al-Maliki: This disaster of coronavirus Disease (COVID-19) influenced the national (macro) economic status of some countries and also increases the poverty level.
The important thing is how the world is looking for this disaster. The vaccines, especially for Coronavirus Disease (COVID-19), are one of the "big business". They are looking for this crisis as a way of money production. Hence, the gap between rich and poor has increased dramatically.
Very relevant question indeed.
COVID-19 has affected various countries in an adverse way.India is under complete lockdown upto April 14,2020, which may even extend.In fact, it has further shattered the economy, which was already facing some sort of recessionary trends.The manufacturing sector, service sectors are the worst hit.It is really very difficut, and it will indeed be very difficult to cope up with the situation, even after narmalcy is restored.It may result in downfall in GDP of a country. Even financial sector has been adversely affected.People have lost a lot of money in stock market as a result of this pendemic.
Recession , higher unemployment, closed economies, market shift, online shopping, retail stores will disappear, work from home will be more common.
It doesn't have to be a global crisis, by definition But surely there is a recession
Nidhal Al-Maliki, I anticipate and foreshadow radical changes which might lead to a new global economic system that sets aside the capitalist one.
The economy would suffer and countries might try to revive theirs.
It is expected that most countries will register plummeted figures on trade balances, and contraction in the global economy will also be seen. However, it might perhaps be useful to have an emergence of new policy mix tools, where collaboration among countries takes a central role. If a re-bound strategy is well-played, then there should be optimism that most economies will revive well, albeit the question may remain concerning the pace of recovery.
It all depends on whether or not we stick to the old frameworks. I believe this crisis would be an opportunity to question those frameworks and construct new ones. Isn't it weird that the economy is rattled by shutting down all non essential production? Wouldn't it be more normal if non essential production can be shut down for as long as necessary and then started up again when possible?
The issue at the heart of this is the flow of money. Everything has become dependant on consumption. When consumption stops, the monetary flows come to a halt and the dominos start falling. But it doesn't have to be that way.
I've been diving into our momentary system for several years now and have come to the conclusion that it does not serve our society anymore. It's not just the momentary system of course, there are other factors. Like the fact that having an income is still tied to paid work, even when labour becomes more and more automated. The reaction to this is creating a whole range of jobs which are actually not needed. I'm referring to David Graeber's research on bullshit jobs here.
What the crisis is showing us is that we do not live in a consumption society but in a production society which has gone into overproduction. The economy was being kept adrift by making sure that overproduction was consumed. Marketing and advertising are the tools to do that. Consumer 'demand' is created, not reacted to. We even created 'planned obsolescence' to make sure products wouldn't last too long so that the new batch could be sold.
All that is driven by a monetary system that demands growth. Sure, there is research that states that the current monetary system does not inherently force growth (Article Ecological monetary economics: A post-Keynesian critique
andArticle Consistency and stability analysis of models of a monetary g...
) and the conclusions are mathematically correct. But the conditions that need to be met are unrealistic to say the least (banks invest all profits into the real economy, no one hoards money and people without debt and a good income somehow still take out loans). That would effectively eradicate the financial markets.I'm working on a paper that examines the growth imperative through a computer simulation. The paper still needs some work but a preliminary version can be found here: https://www.academia.edu/39995035/Money_Supply_in_a_No-Growth_Economy
The paper also proposes an alternative, more stable monetary system based on the following white paper: https://www.happonomy.org/inspiration/get-inspired/sustainable-money-system/
So, to come back to your question, if we stick to the existing models and monetary system we'll be in a world of hurt. But in the end it all comes down to the choices we make.
High unemployment.
Recession then economy reaches the new balance.
High investment in health research to battle the next pandemic.
The post Covid19 world is certainly going to look different. In the short term the global economy is going to look different. There will be a global recession with countries having a different impact , depending on their domestic economies and their policies toward the global economy. There will be a setback on globalization as the supply chains will be affected because of the sealing of borders in the short term. There will be newer ways to engage with the global economy prompting the more efficient use of global tecnology for e commerce , digitization and work from home. But the covid 19 has been a great leveler and the realization that on health, climate ,environment and resource use , global networking will be essential and there will be a reordering of priorities as far as security threats are concerned.
It will be hard, but depends to:
(1) country independency to other country (net export): if to many import to fulfill daily needs, it will be a problem
(2) people creativity: related to poin 01, people must creativ to think and produce a substitute goods and service scarcity due to problems in import
(3) budget to pay salary to public servant: people needs their ability to buy things so economy activity can still running. stabilize or increase purchasing power through maintained consumption of civil servants through secure salaries.
(4) government subsidies if the state still has a budget
(5) Rich communities help the needy either voluntarily or coordinated by the government
Additionally, companies will look for new supply chain channels and some countries will have more prejudice towards China.
This epidemic is in itself a major economic shock and therefore will leave important implications in all aspects, especially on the economic side and at the level of the international economy. Before this shock, we found the beginning of a trade war between China and America, and this shock came to reinforce this trend towards more protectionism, which will negatively affect global economic growth.
The global economy will start to operate normally. It will speed-up to increase the economic multipliers to compensate the business losses,
All measures taken today are traditional measures very similar to what was used after the global crisis in 2008 and its consequences. The BoE has allocated nearly $ 39 billion. While the Italian Central pumped nearly 4 billion dollars. To prevent the economy from entering a recession. With the European Central Council hinted at the readiness to help the countries of the Union in pumping money to face the economic recession. Which could hit European markets. So did the Japanese, Chinese, and other central banks. Which realizes the danger of entering the global economy. In an economic recession in light of the high public debt of some of the major economies. And its inability to face a new wave of unexpected economic repercussions. Foremost among them is the American and Brazilian economies.
The outbreak will definitely have adverse effect on economies, especially those that are heavily hit by the outbreak to the extend of halting almost all economic activities in order to deal with the pandemic. There is likely to be collapse of businesses which will also lead to unemployment, reduction in revenues of nations as most borders are closed to businesses and this is also going to result in a huge spending gap for most countries. This outbreak is also likely to have adverse effect on living standard of most people and might reduce welfare. Rise in prices is likely to be experienced as production has been halted in many countries leading to gaps between supply and demand, with the latter exceeding the former.
Indeed the outbreak will hit most economies and is up to the authorities to put measures in place as well as strategies to limit the adverse effect associated with the pandemic.
Corona's crisis touches the global economy, which will be affected in its full joints, not only financial, but more dangerous than that, the productive and consumer sectors, and sectors that touch the joints of the economy, for example the global aviation sector.
الاقتصادية والاجتماعية والسياسية، وتحول من نظام العولمه والتحرير المالي والتجاري الى القطريه والشعبيه والمناطقيه أزمة كارونا ٢٠٢٠ متراميةتاثير على جوانب
The impact of the spread of the virus on economic growth and global demand for oil. Indeed, the spread of this epidemic has negatively affected investor sentiment, which drives many of them to move towards safe gold-style assets, which are a safe haven for hedging in times of crisis.
📷 @
Greetings, Doctor
One thing that has not been thought about is the ability of markets to absorb the return of production to normal. As a result, I believe there will be an economic recession in light of the expansion of loans to producers and the failure to study consumer markets and their ability to absorb production.
Please review the following link contain preprints .
Preprint Coronavirus (COVID-19) the environment is recovering and the...
اعتقد ان القطاعات الاقتصادية ستحاول تعويض الخسائر التي تعرضت لها لزيادة المضاعفات الاقتصادية لتعويض خسائر الأعمال
The world will not be the same at least for sometime. People will be having comparatively low disposable income, and a fear of infection will remain in their mind. New Labour Laws/Norms, new Human Resource practices, new type of industrial environment will emerge.
Though most stock markets (and oil prices) have nosedived recently, the transitory effects will have prolonged impacts on economies and companies’ earnings because of Covid-19 pandemic and health crisis.
This is also evidenced by the fact that the Fed decreased very recently interest rates to zero levels and the markets keep nosediving. This is an indication that markets are already far sighting and factoring the long-term impacts of current world events because of Covid-19 pandemic and the resultant health crisis.
I am afraid, but current world events will have major impacts on countries and companies’ earnings, which will definitely led to many bankruptcies worldwide.
The recovery from the economic impact of the Covid-19 health crisis will take lot of efforts and prolonged period of time.
There will be a recovery after a 6-month period and new ways of producing goods and services will found in post-Covid19.
I guess there will be on long-term impacts of covid-19 on companies and some countries where they both will lose some of their position worldwide. another hand, the market will shift to online shopping and a lot of retail stores will close.
IMF: New predictions suggest a deeper recession and a slower recovery
Compared to our April World Economic Outlook forecast, we are now projecting a deeper recession in 2020 and a slower recovery in 2021. Global output is projected to decline by 4.9 percent in 2020, 1.9 percentage points below our April forecast, followed by a partial recovery, with growth at 5.4 percent in 2021.
Read more through below source link: https://www.weforum.org/agenda/2020/06/imf-lockdown-recession-covid19-coronavirus-economics-recession/
Over 95% of the world's countries are projected to have negative per capita income growth in 2020.
It will be resuscitated but slowly because this pandemic has disturped in a large extent.
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