Experts define a global recession as a period of economic downturn for two consecutive quarters. Economic signs such as inflation, GDP, unemployment rate, capital flows, oil consumption, industrial production, and more, are used to determine if the market is under a financial collapse.
These impact on the entire world economy is considered a global recession. In today’s global system, if one of the major economies of the world such as China or the USA is under distress, the entire earth feels the effect.
Currently, the news channels have linked coronavirus with a possible collapse and looking into previous recessions in the past, some lessons can be learned.
One of these lessons is to be proactive in self-education to reduce the impact of a global recession. Skills such as affiliate marketing or other work from home jobs can be useful in providing a stable source of income in difficult times.
The 2008 Global Financial Recession
The financial crisis of 2008 was a global recession. The disaster began in 2007 with the subprime mortgage bubble and banking crisis. The subprime mortgage sector in the United States had collapsed, as a result triggering a cycle of financial distress for different industries.
The extremely high default rate on subprime mortgages led to the financial damage to the world’s economy. Lehman Brothers, an investment bank based out of New York, magnified the financial impact globally, making several countries go into recession.
The efforts of the US treasury department and Federal Reserve could not prevent the crisis. The unemployment rate had gone about 10%. The banks were one of the main culprits as they had bundled bad home loans with good ones and sold them as mortgage-backed securities. They thought to mix them will diversify the risk, but that wasn’t enough.
Coronavirus and Global Recession
The 2008 financial crash is regarded as a “world economic disaster” since the Great Depression in 1929. The current coronavirus pandemic is evolving into a new global crisis.
Some experts believe that COVID-19 will cause a recession bigger than the 2008 global crash. Coronavirus keeps taking human lives, and as a result, world economies have equally been affected.
The US stock market has declined and back to where it was three years ago. The lockdown imposed by governments everywhere has further declined social and economic activities. Medical experts believe this is the only way to slow the spread of COVID-19 until a vaccine is created.
How Often Does a Recession Occur?
There have been global crashes in the past and each collapse has its impact on the world. During the late 1930s, there was a 13-month long recession where unemployment rose to 19%, known as the “Roosevelt Recession.” The cause was linked to government-backed projects that eventually led to the stock market crash of 1937.
After the end of World War II, returning veterans could not find jobs as most of the positions had been taken by others. Unemployment rose to over 6%. Meanwhile, the government worried more about inflation than unemployment. The world economies had begun the long road to recovery after the war.
In more recent times, the Dotcom Bubble had created a global financial recession. The timing had coincided with the event of 9/11 and accounting scandals at major corporations. During the late 1990s, the world had witnessed a rapid rise in internet-based technologies.
There was massive investment in internet companies. The stock market rose exponentially. The bubble burst in 2001, causing a massive financial downturn just like the current coronavirus case.
How to Prepare Yourself for The Next Crash
Work from Home Digital Skills
The coronavirus pandemic has pushed more workforce to work from home. Unfortunately, many people have been or will be laid off from their jobs.
The future of many is in the hands of corporate decision-makers. Do you want to be self-sufficient in your finance? Diving into the digital space to create a life above recessions is for sure the right thing to do.
4 High-Income Digital Skills You Can Start Learning Today
1. Affiliate Marketing
This is the process by which an affiliate earns a commission for marketing another company’s products.
You simply need to search for a product or service you are passionate about, promote it to an audience of similar interest, and as a result, earn a commission from each sale. The sales are tracked through affiliate links from one website to another.
Take this FREE on-demand online workshop to learn how affiliate marketing works.
2. Customer Service
A lot of companies are already using work from home customer service agents, and you can fill in that space. Your job is to respond to potential customers by answering product and service questions to fulfill the client’s needs and ensure consumer satisfaction.
The most in-demand skills for work from home customer service agents are good communicating skills, self-discipline and in-depth knowledge of the service or product.
3. Software Development
This is another “work-from-home” high-income business. Several online programming courses teach different software skills such as app creation, web development, and more. Also, there are different types of programming languages you can choose from.
4. Forex Trading
Coronavirus might have the stock market going downwards but that doesn’t stop forex-traders from making money. Traders rely on small ups or downs in the trajectory of world currencies.
If you can read financial indicators and have the discipline to follow an investment strategy, then you can make money regardless of economic downtimes. There are several resources online that offer lessons on trading.
Time to get proactive
COVID-19 has taught us that global recessions can occur at any time without warning. Start investing in yourself by learning digital skills.
Don’t let future economic Crashes stop you from living your best life.
What actions will you take today to create a life you are passionate about?