Investors Beware!! Here Are The 5 Trends That Can Cause Havoc In The Global Economy — Springfields of Rejuvenation
Investors beware, the global economy is flying into turbulence and with a near-constant stream of bad news from around the world, this is the time to be cautious with your money. I have curated the Top 5 Trends that can impact the global economy this month and beyond, which provide insights into what can affect your investments. More so, when everyone and their dog is preparing for a recession, it makes sense to load up and buckle up for the wild ride ahead.
All Hell is About to Break Loose, with Central Bank Taper and Tightening Impacting The Global Economy, which was on Steroids Thanks to The Printing Presses.
First, let us start with the Central Bank’s taper and tightening policies. For a long time, global investors have been used to “ultra-cheap” money, thanks to near-zero interest rates by Central Banks. While initially, low-interest rates prevailed as a means of spurring growth, many investors took advantage of the easy money to invest in Emerging Markets in the developing world, especially in Tech startups and indeed, on whatever caught their fancy. With so much liquidity sloshing in the system, it is no wonder that many of the startups became Unicorns or those with Billion dollar valuations. Well! The party is over and much like the Dotcom crash in the 2000s, history is repeating itself with the ongoing bursting of the Unicorn bubble.
The Global Economy has been on “steroids” for much of the last two decades, more so in the aftermath of the pandemic, as Central Banks flooded economies worldwide with money so as to kickstart growth and “support” both macro and micro-segments, including households to make up for the loss of incomes. This led to asset bubbles and overpriced stocks, which are now facing a “moment of reckoning” as they trend downward towards “realistic” valuations. Investors beware!! As the era of cheap money is drawing to a close, and more so for the TikTok generation who invested in themselves and became part of the Creator Economy, the ongoing crypto and digital stocks are certainly a cause for concern.
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