Let's analysis what changed the economy across the globe during the biggest recent recession happened in 2008. Obviously Corona Virus is a new story and lets analyze that after the entire situation settles. Let's imagine an Alien was sent to Earth and asked to analyze the economic situation in the world between 2007 and 2009, which was just a year before and year after the recession 2008
In 2007, Alien saw people were happy in going for parties quiet often, fireworks celebrations happen now and then, People celebrated New Year, Diwali, Christmas, Ramzan and many other festivals joyfully across the globe. People exchanged greetings, sweets, gifts happily among their friends and relatives
The same alien comes back in 2009, He saw almost the same what happened in 2007. There are few who are badly hit due to 2008 recession
Both in 2007 and 2009, he saw almost same number of office buildings, factories outside the city, almost same number of vehicles moving in the highways, schools teaching their students the same way as before
Also saw computers were faster in 2009 compared to 2007, Medicines are better, Cars gave better millage, Social media has grown up exponentially
Now, he started to look at the numbers, For his surprise he saw US households are $16 Trillion (Rs.1,19,00,68,80,00,00,000) poorer in 2009 than they were in 2007. He also found 10 Million ( 1 Crore ) more Americans are unemployed compared to 2007. Stock Market has reduced to Half its worth compared to 2007 (I'm giving these analysis considering Americans, since US is the biggest economy in the world, so you can estimate the economic situation of other countries, which were still worse)
Alien was totally confused and found that humans almost behave the same way as 2007 inspite of this huge economic crisis and lowered financial numbers because humans have changed their stories & belief what they told to themselves in 2007, those were:
1. Humans don't believe the stability of housing prices anymore in 2009
2. Humans don't believe the prudence of Bankers anymore in 2009
3. Humans don't believe the ability of financial markets to accurately tell the risk of the price anymore in 2009
I would like to conclude that no one in this world can accurately tell the risk on the pricing part. This is what exactly our universe has thought us in Recession 2008.
Have a Great Day
B G Nareshkumar
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