- The Kremlin has warned about a global economic crisis.
- Unemployment numbers continue to be rising in the US and Canada.
- Post coronavirus, expect less reliance on workers and more on artificial intelligence technology.
The Kremlin warned the nation to be ready for a global economic crisis due to coronavirus. Russian numbers of infected continue to increase. In the US, it is now recommended for everyone to wear a mask or a scarf while outdoors.
British Queen Elizabeth II compared the coronavirus pandemic to World War II. Currently, the global crisis has a unique set of factors and certain circumstances. It is a multidimensional crisis that is triggered by the spread of the COVID-19 pandemic. Imbalances continue to expand, including manufacturing. Hence, there is a growing issues of import and export around the world.
The budget deficits, what the developed nations across the globe get to experience shortly, are an unrestrained attempt to pour more money into the economy at the expense of the state budget. This will create a competition in the public debt market and an increase in interest rates.
The public debt of many nations around the world is skyrocketing, amounting to more than their annual GDP. Debt servicing is already becoming a serous issue. This could be a setting for mass default.
Many economies also suffer from insufficient economic diversification. The global economy is widely acceptable when everyone works according to equal rules in their niches of the economic process. The decline in the service sector, which in some countries accounts for 60-70% of the economy, almost guarantees huge turbulence in the economy and, as a result, sharp downturns. All this is taking place under conditions where free trade is partially blocked thanks to the sanctions policy of the US and the EU.
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There is also a liquidity crisis generated by many of the previous imbalances. This is caused by problems with the distribution of financial assets and the lack of adequate control over the distribution of financial flows.
There are also unemployment issues that continue to be a problem for many nations. In US and Canada the numbers continue to increase rapidly.
Also, the Russia-Saudi oil war is distorting the oil market.
As with anything the coronavirus pandemic will end, likely by the end of summer. A majority of the developed nations governments are hoping the economies will return back to normal after the pandemic subsides.
The economy after pandemic will minimize human participation in production processes and interaction with consumers. In such cases, a person will still be needed as the creator of such systems and structures, or as their controller. This change is already noticeable, as certain bank chains in the US are installing artificial intelligence bank machines, which eventually will phase out tellers. The roll out is coinciding with coronavirus closures and a skeleton staff.
It is for certain the pandemic will change how we view certain recreational activities and service industries. Things might never be the same.