Aided by major advances in Information Technology,the GDP’s of the United States and other countries has risen dramatically during the 1990′s and into the current century. Economic and financial advances and declines are of course cyclical yet few experts or analysts in the global market place anticipated the rapid financial meltdowns we have witnessed in recent weeks and months, the steepest decline since 1929.
The criticality of the current world financial situation has indicated a strong need to strengthen and perhaps reinvent our existing economic and financial models and practices. The financial rescue, or bailout if you prefer, packages put in place just recently initially did little to stop the plunge in stock indexes. Admittedly it will take some time to tell if these financial aids will have the desired effect of turning the USA and global economies around.
The demise of larger financial institutions such as Lehman Brothers was not totally surprising to everyone. An analysis of Lehman Brothers business model, their policies, lending strategies and basic business practices would seem to make the eventual downfall of the company inevitable. It is strange that with an abundance of danger signals that the fall of the company was not predicted much sooner or at least in time to have done something constructive about it. Instead employees and shareholders were left holding a rather empty bag.
The question arises here is how long and how many times a country or banks would be able to prevent these debacle? Is our strategy of investment or portfolio being adopted is healthy enough to promise a sustainable growth rate. Surprisingly the recent G7 meeting couldn’t find out feasible solutions.
The US and China have been working together to attempt to get tings turned around with perhaps some success. However, even if these to major economic powers experience some success in achieving a recovery, the other Asian and the European countries have to be fully involved in the process.
The practice of instituting financial rescue or bailout packages begs the question as to how long and at what cost will financial institutions and economies be able to withstand the pressure leading to future debacles. While the financial situation is under repair the investor has to review is or her own patterns of investment to determine how, from this time forward, to gain a sustainable growth rate.
So it is really up to the political leaders of the affected countries to step up and cooperate in finding the means not only to reverse the current situation but to prevent a reoccurrence as well. Until that happens the small investor, and perhaps the large investor as well, needs to be very cautions as to where they are putting their money.
All to often when we read the news about the plunging stock market we may feel unaffected unless we ourselves are players in the market. What is not always so apparent is the slowdown in the economy, noticeable loss of jobs and lowering of wages resulting from loss of share values. The average citizen needs to be aware of the effects of what is going on in the marketplace on his or her own well being. The road to recovery isn’t just about saving major financial institutions but also about educating the average citizen about what this all can mean to him or her.
Tags: website traffic, advertising online, business, advertising
