A Recession with the love of money by Bilal Mussa BSc Econ.

It’s quite clear by now that the economic state of the Eurozone is not going to Improve anytime soon. From my previous blogs I have always said that it is best for Europe that Greece defaults on its debts and starts a clean slate. However, our politicians have thought otherwise and are doing whatever they can to pull out a country 5 ½ inches in its grave. This had led to a wide spread of criticism from all over the globe especially that from the ex-Malaysian Prime Minister who said that it is now time that Europe looks at Asia and learns something from the commonwealth states : Don’t spend when you cannot afford !

Nonetheless, we have seen the public have an outrage at some CEOs who have a job of running a company. These are multinational organisations who require very tight targets and people that have the calibre to drive the business forward and generate profits. Surely they deserve the bonus that they receive. Be it in the millions or in the 10’s of pounds. Yet we have not given half as much as grief to our government for helping out a country in the Eurozone which clearly all the member states know it is a waste of time but yet wish to keep their nose stuck high up.

With such incidents taking place we need to get down to some very hard core facts :

a.      Our economy is not looking pretty

b.      We are seeing a breakdown in the fabric of society

c.       People are still living beyond their means

I would like to put some emphasis on point C. This is because it is an issue which I have encountered many times. We all know that the outlook is bleak and that tightening our waist belts is the best thing any of us can do at this very moment in time. We should make paying off our debts the priority because these low interest rates will be here for a long time to come but who knows about the finances that we have. Being debt free will involve a better credit rating, less stress and most of all no interest payments.

It is however eminent that people ignore their debt since they are in a lot of debt and still want to live the high life at the expense of others. The love for money and the life is not going to help our future generations unless we do something about it now. There needs to be a change in the culture in which our standard of life is formed around. I am not saying to be a miser but don’t be extremely lavish either. Increasing the burden on ourselves and the country will only mean that Britain being a developed country will have to go cap in hand to the World Bank or IMF for a bail out. How embarrassing will this look?

If everyone changes their attitude towards debt and makes an effort to abolish debt and want to live in a debt free manner we will definitely see the wheels of the economy moving again as businesses and individuals can remove their breaks so that the countries wheels can move forward again. Investment will begin to pour into the country as our credit rating will not receive a shock like our fellow partners across the pond.

It is disappointing to see that we have still not see the growth we had been promised and that the year 2012 was a year to be spectacular in terms of growth, inflation and of course the Olympics.

On another note, day by day we are becoming more and more understanding of the situations that we reside in and the consequences that take place. We are able to forecast what happens to the economy better than ever before. However, we have not seen that every recession is having a greater impact than the previous one. Each recession is being due to a spectacular action be it the price of oil, financial meltdown or the stock market. The impact grows and grows. The next recession will definitely be due to the housing market in Asia. I would welcome anyone’s thought on this and will make sure that the next article relates to the Asian Property Bubble 20XX.

 


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