Did you know that another massive financial crash is coming!? The cost of living is increasing so, learn to create wealth for yourself via centralised and decentralised (De-Fi) structures in place. Rumour has it that we need to get rid of cash, you cannot save your way to wealth due to inflation and government printing of money; I am not a financial adviser though. It makes real sense if you get that cash of yours out of the banks and invest into assets. You must invest to protect your capital to prevent surviving to get by. What measures have you put in place to ensure that consistent cashflow will be realistically achievable?

This day and age is not the time to be silent, relax or give excuses why you cannot achieve your financial dream. On a more serious note, this is the time to start taking massive action in order to have multiple streams of recurring income. If you do not make money while you sleep, you will be working until you die. This is where diversification of investment comes into play. You need to learn how to diversify your investment portfolio to avoid putting all your eggs in one basket.

WILL THE NEXT MAJOR FINANCIAL CRISIS COME SOONER THAN YOU THINK?

Unfortunately, an inexorably growing financial system, combined with an increasingly toxic political environment, means that the next major financial crisis may come sooner than you think. The most important thing is being able to strategise to avoid being brook. Until you become very angry to eradicate poverty from your life, cashflow can never be realistically possible. Secondly, strongly believe in diversification of investment, in order to enjoy multiple streams of recurring income.

WHY DO FINANCIAL CRISES CAUSE SO MUCH HARM?

The global financial crisis causes so much harm because people rely on financial institutions every day: banks provide credit cards so we can pay for things more easily; pension providers help us plan for the future; and insurance companies provide cover in the event that our belongings are damaged, lost or stolen.

WHAT IS A STOCK MARKET CRASH AND HOW DOES IT HAPPEN?

A stock market crash is a sudden and significant drop in the value of stocks, which causes investors to sell their shares quickly. When the value of stocks goes down, so does their price and the end result is that people could lose a lot of the money they invested.

CAN WE OVERCOME THE EFFECTS OF A MARKET CRASH?

When we look back, we are reminded that, yes, a market crash is an exceedingly difficult experience to have, but it is something we can and will overcome. The Great Depression, 1929: Over the course of a few days, the DJIA dropped nearly 25%. 3. It took a little over a decade for the economy to get back to predepression levels.

GOOGLE BOOK HIGHLIGHT                         

The global financial crisis was the first in recent history that was triggered by problems in the financial system of the mature economies. Existing work on a financial crisis in emerging market. Countries, however, almost exclusively focus on the role of financial frictions in the domestic economy. In contrast, we propose a two-country DSGE model to investigate the transmission of a global financial crisis that originates from financial frictions in the rest of the world.

FINANCIAL SPILL OVER

We find that the scale of financial spill overs from the global to the domestic economy and trade openness are key determinants of the severity of the financial crisis for the domestic economy. Our results also suggest that the welfare ranking of alternative monetary policy regimes is determined by the degree of financial contagion, the degree of trade openness as well as the scale of foreign currency denominated debt in the domestic economy.

MONETARY POLICY BECOMING WEAK

However, the financial crisis negatively affects the business cycle. The reason is that the financial crisis would cause the declines of aggregate output while fewer banks during the crisis played key intermediation roles so that the effects of monetary policy become weak (see Fidrmuc & Korhonen, 2010; Hale, 2012; Lothian, 2009). These findings support Hypothesis 1, that is, the relationship between bank credit and the business cycle is significantly positive and robust to controlling for other fundamental factors.

ASYMMETRIC EFFECTS OF BANK CREDIT

Regarding the co-movement between financial factors and the business cycle, we use the data of eighteen countries from 1999 to 2016 and examine the asymmetric effects of bank credit on the business cycle by using the panel quantile regression. The empirical results suggest that bank credit is pro-cyclical and amplifies the business cycle and this effect is larger in the economic booms. In addition, the asymmetric effects of bank credit on the business cycle are robust in the different prediction horizons and for alternative financial factors, including M2 supply and stock price. 

If you have gained value from this blog post, please do not hesitate to leave a comment beneath the post. Also, you could get in touch with me to get you started in a sustainable business (s) that will enable you to be able to maximise wealth in such a period of global economic crises.

Thank you.