Question

Do you foresee any other positive influences the COVID-19 virus may have on local or global financial markets? Provide a web article.

Answer 1

COVID-19

Corona Virus or COVID-19 as it is popularly known, is the first and foremost human tragedy which has shook the world affecting hundreds of thousands of people across the globe and it has a growing impact on the global economy. The outbreak is rapidly growing and is believed to have an adverse impact on all the businesses across the world. The pandemic outbreak continues to spread and has already taken a toll on 35000 people and 735000 prevailing cases as of March 30. Governments across the world have launched various public-health and economic responses and the situation seems to evolve day by day.

The impact on the global economy

There are possible predictions, which depends on how the government and the society respond to the pandemic crisis and its economic aftermath.It is argued that we need to build socially justifiable and economically sound future. From the economic point of view, there are four possibilities viz., a transition into barbarism, a robust state of capitalism, radical state of socialist traits, and a transformation into a greater society built using mutual aid. Though Corona Virus appears to be the resultant of a climate change, is partly a problem of the economic structure. Although these appear to be environmental or social problems, they are generally socially driven. Covid-19 and climate change can be tackled simultaneously by avoiding some unnecessary economic activities. Political economic scenario is useful in understanding as to why they were not implemented earlier in certain European countries like UK and US. As a result of the pandemic crisis, the entire global economy is locked down and is placing huge pressure on the global economy. and as a result of this we face a serious recessionary situation. Business generally exist to make profits. If the business is not able to make profits, they will not be able to sell products as well. This means that the business will not profits and as a result of which business cannot employ people. As a result of this situation, the level of unemployment goes up.

Ina normal situation, the solution for this scenario would be very simple that i.e, the government will spend until people start consuming again. The motive of the lock down is to stop the people going to work in order to avoid spreading the disease. In order to be resilient in the future, we need to install a system which is capable of scaling back the production in the way that does not lead to the loss of livelihood. We need to see more opportunities to live differently thus reducing the level of production without creating any misery. The reason for so many people doing pointless jobs is partly due to the situation that we are not prepared enough to face the situation.