These are unprecedented times, with everyone getting used to the new normal. Societies are undergoing a monumental transformation. From ‘working from home’ to ’virtual get-togethers’, from ’wearing masks’ to ‘Namaste’ becoming the new norm towards greeting peers instead of handshakes, we are watching the rise of a new 21st century metamorphosing in the wake of this colossal global pandemic. While the initial fear and virality of this menace, well amplified in media channels, paved the way towards uncertainty and ramping up of infrastructural readiness, thanks to the sacrifices and diligence of countless doctors, administrative professional, policemen and every single covid warrior, appropriate steps could be taken by the Government, with lockdowns and release becoming an acknowledged method towards mitigation of numbers of case numbers.
The bright side, in troubled times. Working parents were being able to spend more time with their kids and each other deepening their bonds, busy couples get some much-needed quality time together, the elderly are getting the attention and care they all deserved. Individuals pushing their boundaries to help even unknown people in need. This just shows that humanity needs to stand and deal with the pandemic together, whenever the need arises The bright side, in troubled times. Working parents were being able to spend more time with their kids and each other deepening their bonds, busy couples get some much-needed quality time together, the elderly are getting the attention and care they all deserved. Individuals pushing their boundaries to help even unknown people in need. This just shows that humanity needs to stand and deal with the pandemic together, whenever the need arises
In the early 19th century India was battling the bubonic plague, following which a severe hit to the economy took place in the shape of the first world war, in 1914. The global GDP growth rate fell from +3.0% to -3.6% but the subsequent years as the world focussed back on development the global GDP growth rate recovered to +3.6%. Soon after the first world war ended in 1918, the world faced one of its biggest threats until now, the much-dreaded ’Spanish Flu’ which had a death toll of 17-100 million worldwide, resulting in a fall in global GDP growth rate to -3.4% and after a couple of years once this turmoil was over, it recovered to +5.7% which was one of the highest growth ever seen till that point of time. After a decade of progress, the famous ’Black Tuesday’ happened, which led to a stock market crash in the US throttling the world to ’The Great Depression’ whereupon the global GDP growth rate fell to -3.6%. Unemployment increased, social livelihood was affected and there was panic everywhere as prices fell down by 60% worldwide, changing the status quo of the world. A couple of years later trade started to resume as the global market recovered, boosting new avenues for employment as the global GDP growth rate increased to a historical high of +7.0%. A decade of prosperity was soon followed by the second world war which pushed back the world to 2-3 decades behind, undoing all the progress and taking the lives of more than 70-80 million people. After Hitler was defeated and the world started to recover, the global GDP growth rate rose from -8.1% in 1946 to +6.1% by 1950
In recent times, post the 2008 recession; when the world’s GDP growth rate fell to -0.8% due to the subprime crisis, which bankrupted Lehmann Brothers and a host of financial organisations. The palliative came in the form of globalization, with some economies (such as India) bracing for defaults better than its first-world peers, coupled with rise in technological capabilities. Eventually, thanks better trade agreements between nations, the global GDP growth rate has stabilised at around +3.5%. The silver lining even in this pandemic is that the world is much better equipped to face the Covid-19 situation due to the huge progress we have made in medical science, by November 2020, with any hope, USA and allied countries are going to dispatch the first batch of vaccine against the Corona virus. With medicines already available for emergency treatments and new drugs being developed, we can expect that the world will recover soon from this pandemic.
Since there is no infrastructural damage or breakdown in supply chain the recovery rate post the pandemic is expected to be much higher as compared to the previous cases. It is forecasted that the world will have a GDP growth rate of +5.8% by the end of 2021 whereas India will grow at +7.4% for the upcoming year.
As an investor, one thing that has been observed throughout all this global turmoil is the price of precious metals such as gold/silver and land/property always keeps appreciating. Rare assets such as gold/land have always steadily increased. At a time when stock market is volatile, depending on the expectations some of the safest avenues to invest will be in government secured long-term bonds, precious metals or purchase of land / Near-Ready-To-Move-In properties.