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Will the war push the world into a recession?

Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
I read occupancy at luxury hotels in Paris is at 25%...it's usually at 60% this time of year. I know after 9/11 one of the things that hurt the American economy was that people were home watching CNN instead of going out to movies etc. and spending money.

So what's your take on the world's economy vis a vie the war?
Always wanted to say vis a vie!:D

Comments

  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Still depends how long it takes and what happens in the aftermath.

    Destabilisation like this tends to affect confidence but the financial markets are fickle and if it is over quickly they are likely to restore confidence, especially if there is a new supply of oil on tap.....

    The more important effects will be any changes in the trade flow and probably most significantly the govt budgets of the nations at war.

    The UK govt budget is in 2 weeks time and it isn't likely to be good.

    The US have had to borrow a huge amount of money (Bush is asking for $75 billion) that could have serious implications.......
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    The world already is in a downturn.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    See, Bush says it's cheap compared to what a more horrific 911 would cost...beyond the lost lives.

    But I think, having never studies economics or finance before...:D

    I think we'd be booming now without the war. Just based on all these stats last year of lower inventories, sales and growth of 4%.

    They say, all the Wall Street guys react to events within the war. That's why it's going up and down. When they said it was going to be a short war....stocks went up more in a single day than they have the entire time I've been alive. Then they showed the POW's...stocks fell.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Dont try to judge the state of the economy on the basis of stock fluctuations. The market is not the primary indicator of national economic performance.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Well said Clandestine, that is an important fact to remember, reall effects can only be seen in the LR.

    Maybe increased spending on the military will crowd-out more productive investment. The growing hostility to the US may make foreign investment more risky as well.

    There are so many things that could happen, we won't know properly for years what the cause and effects are..........
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Within the US, as sick as it sounds, since the US is investing in the products (for war) of American companies, war creates some jobs.

    Meantime, British Airways laid off 13,000 more employees because of the slow down with the war. And the American airlines are laying off people too.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Demand side effects do not lead directly to LR growth though and as you point out there are positive and negative aspects depending on different sectors........
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Of course, I haven't studied economics or finance yet. But when I read Paris luxury hotels are at 25% occupancy when they're usually at 60% this time of year...I know someone is losing their job.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    I am not sure if that is part of the boycott or because people won;t travel because of fear of terrorism.


    A US rockband (Tenacious D) cancelled some gigs they were going to do in Scandanvaia because there families didn't want them going any nearer the warzone.

    So i'm not sure what the causes are..........
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Funny you mentioned Scandanvia. That area has come up as a likely Al Qaeda strike because their laws are so liberal...Al Qaeda is playing them.
  • Former MemberFormer Member Posts: 1,876,324 The Mix Honorary Guru
    Do you not think that if there is a causal connection between liberality and increased terrorist threat it is because the fanatics hate 'decadent' western culture?

    Liberality of laws does not mean that the ability of the security service to stop attacks is diminished in anyway..........
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