A global recession is on the horizon - please read OP for mod warning

Relax brah · 24-05-2022 10:47am #1

If you've been paying any attention, you'll know that COVID played havoc with the world economy and we're about to see even worse as a result of the Ukraine war and the Chinese Zero COVID policy.

Russia is one of the world's top exporters of several utterly crucial things: oil, natural gas, wheat, cooking oil, fertilizer, pesticides/herbicides, copper, platinum group metals, timber, and iron ore are just a few of the headlines. Russia will be exporting severely reduced amounts of all of those things this year. Ukraine is the world's 5th largest exporter of wheat and a major exporter of cooking oil and fertilizer.

The world is going to experience major energy and food shortages by the end of 2022, shortages the likes of which we haven't seen in several decades. There will be famine in poorer countries and much heightened food prices in rich countries. Agricultural output the world over will also decrease, because many countries, Brazil sticks out as a major one here (the world's #2 exporter of food), since they're extremely reliant on outside inputs to keep the food growing. Their farmland, while there is a lot of it, sucks and they need loads of fertilizer/pesticide/herbicide (among other things, like compounds to adjust the pH of their farmland) that they won't have enough of for a while.

Energy-wise, the world is going to see $100+/barrel prices (up from around $70 for most of the 2010s) for the foreseeable future. When you remember that the price of energy affects the price and amount produced of every other good and service you'll see why that's important.

On top of that, China has locked down several of the world's most productive cities. It's exports are already way down and probably won't get back to normal....ever. They're having loads of other problems (housing market has been tanking for almost a year now, household debt is higher than it's ever been, equity markets are less stable than they've ever been, unemployment is at an all time high, etc.) that will probably depress their economy for...again probably ever.

Depending on where you live, things are going to get pretty rough by the end of this year.

What are your thoughts?

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Please use the relevant thread to discuss Russia/Ukraine. And if you are banned from that thread you can expect to be banned from this one if you continue trying to discuss it here

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dashoonage · 24-05-2022 10:48am

jaysus relax brah...

Calahonda52 · 24-05-2022 10:57am

Dont forget the inflation wage hikes job layoff cycle.

This winter will be very rough for a large swathe of the population

Fandymo · 24-05-2022 11:02am

Bring it on. The global systems we have now to eke every penny of profit from every possible consumer isn't able to work long term. Hopefully a rise in nationalism will happen, the EU will go back to a trading/travelling bloc and prices will reset to the norm. Countries should be looking to be as self sustainable as possible to look after the needs of THEIR citizens, and not the entire world's people.

Pussyhands · 24-05-2022 11:07am

We need a recession to reset the economy. It's out of kilter now with so many imbalances.

Relax brah · 24-05-2022 1:18pm

https://www.boards.ie/discussion/comment/119106200#Comment_119106200

Completely agree that it’s needed.

https://youtu.be/mEpgo14jwSk

This sort of explains it , But from an Economist's Pov it's obviously a lot more complicated than just that

Beasty · 24-05-2022 1:31pm

Need to add Climate Change into the mix. Is it right that cheap goods should be sent halfway around the world when there may be more expensive local alternatives? If countries fail to start to address some of the climate issues things are going to get worse

Countries are going to need to look even deeper into supply chains. We are already seeing more costly extreme weather events and it's probably going to get worse even if we do make efforts to halt the slide

We've probably lived through the best times during the last 2 decades, but the chickens are coming home to roost with all these global issues hitting and we are probably all going to see some decline in living standards to get to a sustainable level

slay55 · 24-05-2022 1:48pm

Well I for one, am glad I decided to open this thread. Feel really positive now !

Wanderer78 · 24-05-2022 2:05pm

https://www.boards.ie/discussion/comment/119106177#Comment_119106177

...ah yea, increasing tensions and the possibility of serious conflicts, definitely will solve this one!

Pussyhands · 24-05-2022 2:12pm

https://www.boards.ie/discussion/comment/119106838#Comment_119106838

What does a world look like where we don't have access to cheap labour?

The global economy has been built on capitalism where developed economies leverage the cheap labour of Asia to improve the standards of living in the developed economies.

It's essentially a pyramid scheme of grand proportions.

joseywhales · 24-05-2022 2:16pm

I am 35, when my dad was 35 it was 1985. My standard of living is much much better than his was in Ireland in 1985. Obviously a lot of people are in a hard place but relatively people have a fantastic standard of life. In 1985-2000, we thought we were well off if we had 3 meals a day, a roof over our head, a day out at a local match on a Saturday and one car that barely ran and anything that was broken was fixed or mended by us. A small dip now is not a big deal, though one thing I would worry about is that if we can feel the pinch here, you can be sure there will be mayhem in the developing world and that could lead to the contagion of conflict and mass migration.

Wanderer78 · 24-05-2022 2:23pm

https://www.boards.ie/discussion/comment/119107218#Comment_119107218

its virtually impossible to directly compare generational differences, as theres so many differences, but its clearly obvious, our most critical of needs are deteriorating rapidly, this can be clearly seen with our property markets, health care systems and of course our environmental issues. yes life was very difficult for older generations, but getting access to these critical needs was actually easier then than now, and of course our environmental issues were not as serious. something has clearly gone catastrophically wrong in this period....

24-05-2022 2:38pm

Good.

Hopefully house prices will collapse with it.

24-05-2022 3:19pm

https://www.boards.ie/discussion/comment/119106177#Comment_119106177

Yeah because natioanisim hasn't been the cause of major conflicts and other issues in the past two plus centuries, and countless didn't assist other countries with humanitarian efforts either during those periods.

Most countries haven't the raw materials needed to properly clothe their population, fertilise their crops, run transport systems etc, including Ireland and that doesn't change regardless of how much some think it will with an Irexit, and other break ups of trade groups and agreements.

I swear some of ye had parents who were related or they rocked ya to close to the wall.

Fandymo · 24-05-2022 3:26pm

https://www.boards.ie/discussion/comment/119107693#Comment_119107693

that doesn't change regardless of how much some think it will with an Irexit, and other break ups of trade groups and agreements. - Missed the whole EU remaining as a trade block part, eh??

Yurt2 · 24-05-2022 3:27pm

https://www.boards.ie/discussion/comment/119106838#Comment_119106838

Read an article that the US industry in particular is slowly but steadily onshoring it's productive capacity away from China. China's productive capacity peaked somewhere around 2003-5 and the last decade has meant it's no longer a low-wage country any longer. And in any case, automation means there is nothing that can be done in China that can't be done in the US for more or less the same cost. What higher labour costs there is, will be made up for with shorter supply chains.

It will take time extracting critical industries away from China, but the process is well underway.

As much as I'm loathe to give the man credit, Trump helped this process along the way with a lot of inducements to American industry.

DaBluBoi · 24-05-2022 3:29pm

Last straw would be if China invades Taiwan now…

If that happens, we’re basically f***ed

Yurt2 · 24-05-2022 3:30pm

https://www.boards.ie/discussion/comment/119107427#Comment_119107427

I'm not saying you're wrong or right in feeling this way, but you're not alone in holding this sentiment.

Policy makers the world over could do with sitting down and have an honest conversation with themselves why vast swathes of the developed world would be so unhappy in a growing economy and would cheerlead a recession.

freemickey · 24-05-2022 4:14pm

Unsustainable and downright idiotic behaviours have brought us here.

Booming inequality, housing scarcity, social immobility, increasing poverty, decreasing opportunity, homelessness, educational ignorance, anti-science, media bias, climate problems.

The plague of big tech companies has taken a grip on this country, like everywhere else they land. Companies whose raisin d'etre is selling your privacy for advertisement or becoming unnecessary middle men. A bubble of outrageously overpriced unproductive nonsense bound for the burst.

Reliance on migration to provide never ending cheap labour without a single regard for capacity.

Commodification and speculation on life's necessities such as housing, a tiny country put up for sale to anyone from anywhere, practically colonial times again.

No thought to the medium or long term future by any political system or group. Money now, whatever about later.

Those are the four horsemen of this apocalypse, big tech, migration, commodification and ignorance to the future. The links between them are obvious and the whiplash of reality is going to be something to behold. Less a recession and more a reckoning.

victor8600 · 24-05-2022 4:24pm

Sure, it's just business as usual. Haven't we had a dot-com crash in 2001? And a financial crash in 2008? The solution for any crisis is to become very rich and to rip the benefits of a good crisis at the expense of the huddled masses:

Ten richest men double their fortunes in pandemic while incomes of 99 percent of humanity fall

Boggles · 24-05-2022 4:49pm

https://www.boards.ie/discussion/comment/119107293#Comment_119107293

its virtually impossible to directly compare generational differences

Like fúck it is, I remember the 80s vividly, that decade was beyond grim.

SuperBowserWorld · 24-05-2022 4:56pm

https://www.boards.ie/discussion/comment/119108109#Comment_119108109

Some good music in the early eighties and we had 40 years to something about climate and environmental damage. So it wasn't all bad. 😆

Boggles · 24-05-2022 5:00pm

https://www.boards.ie/discussion/comment/119108140#Comment_119108140

I'd question the music.

As for environmental damage.

https://www.vox.com/future-perfect/22686105/future-of-life-ozone-hole-environmental-crisis

Geuze · 24-05-2022 5:05pm

https://www.boards.ie/discussion/comment/119107962#Comment_119107962

Income poverty has been falling in Ireland.

SuperBowserWorld · 24-05-2022 5:24pm

https://www.boards.ie/discussion/comment/119108165#Comment_119108165

Yep, the ozone problem was tacked nicely, but it's solution did not involve changing the energy source, economy and infrastructure, mindset, politics ..on the planet at runtime as climate change mitigation requires.

But, it does show what's possible and is a huge success story for science.

Anyway, this thread is about recession, not existential issues.

Wanderer78 · 24-05-2022 5:25pm

https://www.boards.ie/discussion/comment/119108109#Comment_119108109

again, yes previous generations did indeed have a very difficult time, yes the 80's was extremely tough, but now its virtually impossible for many to get access to their most critical needs, and this is growing rapidly, whereby in the 80's, it was just extremely difficult for most. yes we now have far greater access to far better quality goods and services, but, as mentioned above......

freemickey · 24-05-2022 5:26pm

https://www.boards.ie/discussion/comment/119108193#Comment_119108193

You'll note how you have to add extra words to poverty to make it seem better.

Situational poverty, housing poverty and so forth.

Shorthand, poverty is increasing in this country. Depending who you ask, there are well over 600,000 people living below the poverty line, a third of which are children. Definitions definitions. It doesn't really matter in the big picture of how totally bollicked it all is.

Boggles · 24-05-2022 5:56pm

https://www.boards.ie/discussion/comment/119108262#Comment_119108262

Ah no, by every single measurement we are infinitely better off now.

From quality of life to health outcomes to quality of housing to peace. It's not even close.

I'm not saying we don't have challenges now, but looked at it stark terms the 80s were horrendous, Ireland was absolutely horrible.

Geuze · 24-05-2022 6:05pm

https://www.boards.ie/discussion/comment/119108266#Comment_119108266

All three measures of poverty are falling:

https://www.cso.ie/en/releasesandpublications/ep/p-silc/surveyonincomeandlivingconditionssilc2021/povertyanddeprivation/

Geuze · 24-05-2022 6:07pm

See data from the SILC.

NSAman · 24-05-2022 6:08pm

https://www.boards.ie/discussion/comment/119108406#Comment_119108406

Agree with most of what you have said. We are better off, however, societally we are not. Crime is far worse now, than back then. Social interaction nowadays in limited. We may be financially better off, but we are poorer in many respects. OK, emigration was horrendous in the 80s. It was a grim place to be financially.

I do think that Wanderer is under estimating the "correction" that is coming. Personally, I think this will be the biggest SH!TSHOW that has been seen since the 1920s. The free money, the crazy economic models that have been evolving, the spend spend spend mantra to keep people going, this all has to be paid for. In my opinion it will cause either one of two things to happen, widening the wealth gaps even further or social unrest/war.

A global recession is on the horizon - please read OP for mod warning

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