Is The World Economy Stable?

There have been many experts in recent weeks calling into question whether the world economy is stable. I am firmly in the “no” camp, I really do believe that the world economy is still teetering on the edge of disaster and the stagnation of the Chinese economy in recent weeks has been extremely detrimental to its stability.

We are still at a crossroads period, I firmly understand that the economy is in a much better position that it was in 2008 obviously but it certainly isn’t in the same position as it was in the 80’s. Things are changing and not really for the better, countries are becoming much more economically selfish, take the Cyprus example.

The country was left out to dry by the Germans and while they did receive some support from the EU, the country has been thrown into modern day poverty.

I appreciate countries do need to start taking more responsibility for their actions and infrastructure but for the “world economy” to remain a truly world economy, selflessness has to come to fore in a sense.

This article will explain three reasons why I believe the economy not to be stable despite some favorable signs.

Chinese Stagnation

You will all have seen in the news recently about the stagnation of the Chinese economy and this really is reflective of the global economic situation. Who would ever have thought that the Chinese economy would slow down and stop growing, even for a month? I appreciate that this was always going to happen but it is these super countries that are propping up the global economy and their stagnation is just a feeling of the pinch.

There are many European countries that are doing pretty well economically but they just don’t carry enough weight I am afraid. The world economy is dominated by a few bodies that are so powerful and they must keep showing positive signs for the economy to remain relatively stable.

I am not saying the economy is unstable, I am just saying it isn’t as stable as everyone now seems to think because there hasn’t been a crash for a few years.

Greek Example

As I mentioned before, just take a look at the Cypriot economy, that is still in disarray and doesn’t look like improving, I can’t imagine the Syrian or Egyptian economy is up to much either.

These countries are in a state of conflict and economically they are unstable which has a knock on effect.

Investor Confidence

If you were to ask investment expert Alok Oberoi about the current economic situation for investors I am sure he wouldn’t be too positive. That said, I do believe there is great potential to invest now while markets are still sorting themselves out. It is a risky strategy but if you are that way inclined then there can be a lot of profit to be exploited.

The stability of the world economy really does come down to what you believe stable to mean and what you are comparing it to.

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Jake Briggs is an author with a love for current affairs. He takes a keen interest in politics and the economy and they make up most of his articles.

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