imagine a giant heavy wheel of stone moving like a potter's wheel on an axis
that is the economy of any country. the weight represents the number of people in that country dependent on that economy. the speed of the wheel is the size of the economy.
there are 4 principal thrusts moving that wheel
1) agriculture
2) production
3) trade
4) services
for a country which stops producing because of cheaper and better imports from another country, it loses the "production" thrust and is thus reduced to mere trading activity for that produce. and since the margin and control in trading is much lesser than that of production, the economic surplus and resulting prosperity dips drastically.
this is exactly what is happening to us in view of the production surrender to china. an overwhelming percent of producing hands have been reduced to the role of traders. even that is threatened by the online retail portals which are concentrated in the hands of just a few.
all this results in an increase in unemployment and underemployment besides a fall in the standard of living.
on top of this, any demonetization kind of shock further slows down the economy wheel. and if you add the corona lock-down situation there is a real threat of the economy wheel slowing to dangerous levels if not stopping altogether.
also, it must be kept in mind that less-enterprising, inefficient, non-leveraging and non-innovating countries/individuals produce much less than their fixed consumption (necessities plus luxuries). this results in a standard of living much less than those countries/individuals who produce more than they consume.
the current situation caused by covid-19 is leading us into an unpleasant chapter where our production and other economic activities are threatened to be disrupted beyond the slowdown already existing.
someone's income is someone's expenditure and someone's expenditure is someone's income. any stoppage in this circular system with infinite interconnections and multiplication results in serious damage to economic activity due to demand and supply disruption.
our sins of not innovating, surrendering production to imports, disturbing economic activities instead of strengthening them, not making helpful policies, not developing our human resource etc are pushing us fast towards the judgment day.
slowing or stopping an economy is easier than cold starting it because an economy is a complex balance of zillion of interconnected interdependent activities.
that is the economy of any country. the weight represents the number of people in that country dependent on that economy. the speed of the wheel is the size of the economy.
there are 4 principal thrusts moving that wheel
1) agriculture
2) production
3) trade
4) services
for a country which stops producing because of cheaper and better imports from another country, it loses the "production" thrust and is thus reduced to mere trading activity for that produce. and since the margin and control in trading is much lesser than that of production, the economic surplus and resulting prosperity dips drastically.
this is exactly what is happening to us in view of the production surrender to china. an overwhelming percent of producing hands have been reduced to the role of traders. even that is threatened by the online retail portals which are concentrated in the hands of just a few.
all this results in an increase in unemployment and underemployment besides a fall in the standard of living.
on top of this, any demonetization kind of shock further slows down the economy wheel. and if you add the corona lock-down situation there is a real threat of the economy wheel slowing to dangerous levels if not stopping altogether.
also, it must be kept in mind that less-enterprising, inefficient, non-leveraging and non-innovating countries/individuals produce much less than their fixed consumption (necessities plus luxuries). this results in a standard of living much less than those countries/individuals who produce more than they consume.
the current situation caused by covid-19 is leading us into an unpleasant chapter where our production and other economic activities are threatened to be disrupted beyond the slowdown already existing.
someone's income is someone's expenditure and someone's expenditure is someone's income. any stoppage in this circular system with infinite interconnections and multiplication results in serious damage to economic activity due to demand and supply disruption.
our sins of not innovating, surrendering production to imports, disturbing economic activities instead of strengthening them, not making helpful policies, not developing our human resource etc are pushing us fast towards the judgment day.
slowing or stopping an economy is easier than cold starting it because an economy is a complex balance of zillion of interconnected interdependent activities.
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