On Our Mind – Understanding the Interconnected Nature of the Economy
Tags – Nature of the Economy
Care for the economy transcends our political views.
Whether you slide to the left or the right, or even sit on the fence, a healthy flow of money and its circulation is crucial for the economy. And, understanding this flow of money has never been more important than today.
In today’s world, global economies are interconnected. And, as a result, it is not a matter of overnight impacts but instant reactions to what’s happening around us.
Let’s begin with a simple example.
Look at countries on the other side of the world, e.g. India and China. Do their ethics and business production impact what happens in the UK. Even the average person today understands that overproduction has a negative impact on us, no matter where we are. However, things are not as straightforward.
Take fast fashion for instance.
It is not India or China creating a trend of fast fashion on its own. Instead, it’s the appetite of, mostly 1st world countries, that is turning into a society of short term uses. Countries like India and China are simply fulfilling this appetite for fast fashion.
However, India and China pay more severely for this trend of fast fashion, even though most of us are blaming them for it.
Due to having more lenient rules and regulations, these countries have a bigger issue with 1st hand pollution, killing people far faster and in greater numbers than any active virus.
We can connect this over production to even a higher risk of floods, disruption in lives, and even becoming a fuel for restricting societies from transforming and moving forward.
In a society where there is a higher unemployment rate, there are generally other budding issues, e.g. increased crime rates and drug abuse.
There is even extended research that shows that the number one reason for the breaking of marriages is financial issues.
Under these circumstances, you can understand the strain on other sectors, e.g. the NHS or the police. And, as a result, the premiums, e.g. insurance and interest rates go up too.
The bottomline is, we need to understand the accumulating nature of economics.
And, understanding this accumulative effect is also important from the perspective of the current pandemic.
As a result of staying home, people are tending to spend less money and the negatives of this tendency are now starting to show up.
It is understandable that some sectors are struggling in general. However, people who have decided to stack their cash in the name of saving are not helping but making things worse.
That is why, we thought that a basic financial lesson will help. And, in any case, government support is on its way. So, there is little value in going archaic with money.
To learn more, get in touch with us today.
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