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Articles about economics
№4
New disposition of forces
(September 20, 2017)

Surprising events taking place in different parts of the globe noticeably change the long-established and habitual disposition of forces. Beginning in January 2017, the US dollar is steadily becoming cheaper, which is a very strange trend, and gold is steadily rising against this background, which does not cause any surprise since all the scenarios for inflation of the dollar bubble suggest that the value of gold will rise to a sky-high level.

Thus, what everybody has long been frightened, but in what still very few people believed, began to occur - the dollar started to depreciate. Perhaps, this is not the catastrophe shown in YouTube videos, full of imaginary panic on the stock exchanges and a kind of universal alarm. However, the fact that the dollar has been falling for the ninth consecutive month cannot but be alarming. If you think about its fate, distracting from the argument telling that America is always easy to pay any debt, simply by printing as many dollars as it needs, the future of the most reliable currency in the world will be covered with thick fog.

In addition to US National Debt, the dollar is threatened with some other dangers too. For example, the idea of the refusal of it in the international settlements is wandering around the world. It is especially popular in those countries with which the United States have long and stubbornly maintained an unfriendly relationship. There is nothing easier than to annoy the US, refusing to use their currency in internal and external turnover and even completely prohibiting its circulation inside some country.

It's no secret that the strength of the dollar is supported not only by the economic might of the United States but also by the political expansion that they carry out. Creating hotbeds of instability in more and more regions, the US are strengthening their power, thereby keeping dollar at a high position, and the same time becoming a comfortable refuge for capital accumulated in other countries.

Another surprise was the emerging economic boom in India. This country with more than a billion population is now quickly joining the newest information technologies and in some industries has already outscored its colleagues in the BRICS block. Not only mobile Internet of 4G format will almost everywhere be available in India in the near future - it also quickly switched to digital money and tries to reduce the use of paper bills in its economy.

It's hard to imagine how many trees and time needed to produce and count paper cash will be saved if the entire huge and densely populated India starts using only electronic money which does not require cash registers for its storage and runs on wires with the speed of light.

Thanks to the transition to digital payments, the turnover of money will significantly increase, which will give a powerful impetus to economic development. A whole army of cashiers, collectors, auditors and other personnel, whose duties included counting and transporting cash, will be freed from routine mechanical work. Ultimately, it may be possible to abandon ATMs, their maintenance and security, which will also bring significant material benefits.

the acquisition of a consumer worldview by Indians;
the growing use of big data, artificial intelligence and the Internet of things, which Indian programmers are willing to create for less than their competitors;
the emergence of the habit of eating in cafes and restaurants among increasingly busy Indians;
a huge number of young Indians of school and college age;
as well as the arrival on the market of new engineering and medical technologies that are developing thanks to three-dimensional printers.

The brewing economic boom is bolstered by the fact that the new generation of Indians, unlike previous ones, are willing to spend their money very lavishly.

At the same time, an amazing situation develops in the Old World, which today faces a phenomenon called "Brexit" - that is, the March 2019 exit of the UK from the European Union. It would seem that the long-standing issue of exit solved in the referendum now comes back to the agenda, time and again, so during the summer of 2017 it was discussed with a growing drama, and only in September, there was a certain easing of polemical sharpness.

The essence of the contradictions arising unexpectedly from the results of the democratic referendum is that a sharp break in the established economic ties will entail a number of problems, and therefore there was a desire to make parting with the European Union as soft as possible, or "seamless," as the British call it.

The main issue around which many spears are being broken today is whether it is possible to implement the exit procedure while keepeing the United Kingdom's membership in a single market and customs union, the conveniences of which are enjoyed by EU members. In opposition, the idea of the so-called hard or "cliff-edge" Brexit is put forward, which should occur simultaneously along the entire line of existing economic relations.

This option will inevitably lead to the fact that on the first day after such a sharp separation at the border of the UK there will be inconceivable traffic jams of trucks that carry goods and are no longer able to cross the border according to previous simplified conditions. A growing humanitarian crisis is added to this logistical problem too, as the decision to exit from the EU has questioned the fate of foreign professionals supporting the British economy with their labor. Drivingidea.ru LogoArrow

Threats hanging over the dollar

Dynamic digitalization of the Indian economy

Vectors and incentives for India’s rapid growth

The controversial Brexit

What threatens Britain with its abrupt exit from the EU?