To no one is it a secret that the world is going through one of the harshest economic recessions in recent history. According to the International Monetary Fund, just in April, the world’s advanced economies were suffering a -6.1% shrinkage in their GPD, a number that has presumably gotten even worse in the last couple of months. Although the current economic situation is most often attributed to the global COVID-19 pandemic, many believe that a recession was already ensuing even before the health crisis, which only contributed to making it worse. Governments around the world are struggling to find ways to control the spread of the virus while keeping the economy afloat by injecting liquidity into banks and stock markets.
The solution to the global recession, however, has not and will not come from governments. Nobody knows when and if things are going to come back to normal, but we do know that the economies cannot just keep stagnating forever. That is why, in order to overcome the current crisis, we all need to adopt an entirely new mindset and change the way in which we do business and manage out money. These changes have implications for investors, business owners and customers alike.
Business owners need to find ways to adapt their products and services to the current situation, not just by making them more accessible to customers while reducing their need to move, but also by adapting the workplace so that, if possible, their employees can work at a distance. Investors need to develop a keen eye for innovation, by thinking outside the box and daring to leave behind the investments that were commonly believed to be safe and instead look for those that lead to innovation and disruption in the markets. Meanwhile, customers are going to be demanding products and services that allows them to remain at home and make this stay an easier and more pleasant experience.
For all of this to be possible, technology must play a key role. Perhaps the most important requirement for the world to adapt to and eventually overcome the current economic crisis is for frictions in the mobility of capitals to be reduced, and for people to have a higher control on the ways in which they manage, spend and invest their money. As these frictions are reduced, it will become easier for businesses to create innovative products and services that correspond the current demands, and to adapt their models to the current situation.
Learn more in: https://financialnewsjournal.com/how-the-global-recession-will-be-overcome/
