The 2021 Global Economy

  • The GDP indicators will continue to fall.
  • The most significant crisis of the 2021 will be pertaining the sovereign debt and the government lending.
  • The crisis of the insolvency of the 2021

The global economy will be in trouble in the 2021. The economic challenges have been blamed on the Coronavirus pandemic,, which crippled the majority of the world. Even though, Covid-19 did cause an economic crisis, it is a mere smoke screen to shift the responsibility for the bad decisions certain politicians and organizations actually made.

The knee jerk reactions only lead to the negative consequences that will have a big impact on the 2021. The pandemic shown the politicians and nations are not equipped to deal with the crisis. The World Health Organization was too late declaring Covid-19 status of the pandemic. The trust in WHO in the new year will continue to dwindle.

Furthermore, the economic indicators will continue to decline. The GDP indicators have fallen significantly. The rate of the unemployment skyrocketed around the globe.  Many industries have been crippled by the Covid-19 pandemic shutdowns.

The industries effected the most are the hospitality, travel and the entertainment. Nevertheless, there are predictions that in the 2021 there will be an increase at the number of jobs available. The airline industry will not recover in the upcoming year.

Moreover, the most significant crisis of the 2021 will be pertaining the sovereign debt and the government lending. The public debt is increasing in the majority of the nations. The EU had to step away from the budget deficit of the 2%.

The US currently has a colossal public debt. The new stimulus has just been approved in the US. Canada is running the record high deficit, in order to provide the funding needed for people to survive and to stimulate the spending. However, this can’t last forever and the constant borrowing will be exhausted. The Central banks will run into the issue, even though they will continue to print the money.

The European Central Bank is the central bank of the Eurozone, a monetary union of 19 EU member states which employ the euro.

There is also the crisis of the insolvency of the 2021. As a result, the wave of bankruptcies will occur. In the US there could be the large numbers of the foreclosures and the return to the 2008 scenario of the housing short sales. The US dollar continues to show weak results. At present, Bitcoin cryptocurrency has reached all time high and surpassed $25,000.

The new year will be the year of the formation of the global ideology. The markers are there, the mass Coronavirus vaccinations, the restrictions. The new world order will surface in the politics and in the economy. It should be noted, it does not mean the world suddenly will turn to the full globalist paradise.

Certain nations will lean even further left, whilst dabbling into the communist ideology. Canada is contemplating the Universal Basic Income for all Canadians. The idea has gained traction with the NDP and even Liberals are looking into it. If this occurs, it will forever change the economic trajectory of Canada.

The Green parties continue to gain traction in Europe. The reason for such popularity is the Coronavirus pandemic and the need to stop destroying our planet.

Overall, the economic growth will not be seen in the new year.

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Christina Kitova

I spent most of my professional life in finance, insurance risk management litigation.

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