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imagine waking up to a warning issued by the president of the United States of America announcing that another Great Depression is about to happen that feeling you get on hearing such news is replicated when you hear from a Forbes rated Global macro investor that something worse than an economic decline is about to hit hard on us the first question that comes to mind is what do we do to answer that question stick with me to the end of the video as we look at the factors responsible for the economic Decline and how to stay afloat during this recession Ray Doo predicted that 2008 financial crisis and now he's sharing a similar urgent warning about what he sees ahead he believes the times ahead will radically differ from what everyone today has experienced in their lifetimes and he wants people to be prepared the legendary investor and billionaire raid alio is the founder of the world's largest hedge fund while he is not alone in this prediction his unique perspective on the factors contributing to the recession is worth paying attention to interestingly this prediction is not just for the us but for a global phenomenon in 1970 the United States economy hit the Rocks which led to widespread chaos and raised the inflation rate by a mile the stock market was in a mess losing nearly half of its value in Just 2 years economic growth was slow many businesses went bankrupt and many families fell into poverty as a result of the soaring unemployment rate the inflation surge was primarily attributed to escalating oil prices and the unchecked greed of investors as a result the Secretary of the Treasury Al ultimately declared personal bankruptcy fast forward to 2024 ra alio predicts that a similar or even more severe crisis is about to happen how did we possibly arrive at this point according to ra Alo some factors are responsible for the predicted Decline and we'll run through a few of them one the alarming inflation rate this indicates that the prices of goods and services are increasing some believe that a modest level of inflation could be beneficial as it creates opportunities for more employment Rising prices enable companies to gener at higher profits enabling them to expand their Workforce and increase production however when inflation exceeds an annual Target ratio of 2% there is bound to be a lot of discomfort at the consumer's end this means you get to overspend and sometimes deprive yourself of purchasing some things this leaves you with no option but to spend less by cutting your budget spending less means purchasing fewer goods and services directly impacting the companies involved in production this leads to a decline in profits prompting companies to reduce their Workforce a fundamental Factor contributing to a recession another important factor to consider is how Rising interest rates can influence inflation leading to a decrease in borrowing when interest rates go up the cost of borrowing money increases which can slow down investment this can subsequently slow down economic growth and put downward pressure on inflation ra doio highlights how a recession thrives when economic activities are low within a country he added that if interest rates keep soaring and inflation Can't Be Tamed then what coming will be worse than a recession two debt accumulation countries borrow money primarily for economic growth and investment but it's important to remember that Investments can yield positive or negative outcomes when Investments fail repaying debt becomes challenging for instance when you borrow money and invest it in stocks success is crucial your returns must exceed The Borrowed amount so you have enough not only to repay the debt but also to grow your investment but what we're facing in the present day economy is the extreme difficulty in generating sufficient profits to both settle the debt and grow Capital especially amid the constant fluctuations in the Global Financial landscape countries companies and even individuals alike borrow enormous sums reaching trillions in debt and if Investments fail the economy suffers this loss compels the country to borrow more to cover the deficit limiting purchasing power according to the legendary investor this is our reality and the way out isn't imminent therefore we must be ready to face the consequences however if you apply the few strategies he gave you can minimize the effect on your personal finances stick with me a little longer we will get to that shortly what other crucial factor is contributing to the impending disaster three corruption R Doo believes corruption is nearly unavoidable with all governments Worldwide having some level of corruption however corruption is one of the fastest ways to recession this is majorly caused by greed and a lack of government officials for Sight proper economic decision- making is tempered with with when a country has a bunch of corrupt leaders entrusted with a certain level of power they mismanage the funds and resources placed in their care which is our reality all of these factors are seen in major countries today from inflation to debt accumulation and finally corruption these problems linger even amongst world powers today how then do we stay afloat in the coming recession number one plan for a worst case scenario while this might not make a lot of sense it is actually a vital key to surviving what's coming proper planning of stat in a cash Reserve is important planning the inflow and outflow of your money is essential understanding what brings in money and channeling your energy there will be a wise action to embark on as it helps with productivity and proper inflow also store cheap dry food grains that can last a long time on your shelves if you decide to stock up on stuff that doesn't have a long shelf life for what you don't eat often you're just setting yourself up to flush your hard earned money down the drain the way to avoid this it's simple stock up but be smart about it now before you go on a shopping spree you got to consider a few things think about the size of your family the dishes you cook most often and the shelf life of those Foods that'll help you know how much food to keep in your pantry and the time for another round of shopping however here are five foods you can't go wrong with they are basically must haves in your pantry to survive any economic situation you've got rice dry pasta oats beans and instant coffee number two don't leave above your means often we feel the need to keep up with recent trend friends fashion or whatever is getting people's attention but it's important to know that living this kind of life is the fastest way to stay dry the simple advice is to buy what you need and can afford buy it only if it is absolutely important number three educate yourself for educating yourself doesn't necessarily mean going back to college to pick up a degree it just means reading and understanding how the financial systems operate it helps you take advantage of positive opportunities that can help you secure a better life if you're up for it try and invest because it's never too late to invest number four you must have a recession mindset do you know that your mindset plays a major role in the decisions you make in life this includes not only your financial decisions but every decision you make your mindset affects how you react to situations and allow a particular situation to affect you a recession is an economic downturn that most people never want to deal with or how to deal with it the news about the recession is everywhere recession is coming the economy is not doing so well companies are going bankrupt businesses are folding up Etc all these are speculations that a recession might hit soon this news should not make you panic rather you should start putting measures in place to Recession Proof your life so that no matter what happens you will not end up suffering from the market downturn while companies folded up incurred debt went bankrupt Etc do you know that some companies grew stronger during recessions Microsoft Lego apple and Netflix became stronger companies after market downturns and economic hardships how how did they achieve this feat it all comes down to their mindset and the way they respond to the market condition as an individual you need to prepare your mind and finances for any Market situation so you can stay on top of your financial goals regardless of what happens with the economy a few things that can help you at such moments are never to panic yes do not panic stay calm and avoid hearing too much negative news it induces fear and panic in your mind also you should know your risk tolerance level and never make any decisions that will keep you away through the night or make you restless so be careful not to fall into some quick money scheme out of desperation to survive rather preserve the little you have another key recession mindset to cultivate is to start building multiple streams of income from now on job insecurity job loss layoffs and increased unemployment rates make things worse for most people because they only have one source of income they become stranded when they get laid off you do not want to have to take credit card loans to sustain yourself after a job loss you need to have additional sources of income the more you have the more secure you get if the market situation cuts off any of the streams you will still have others to fall back to it's not too late to start stay ahead of others thanks for watching see you in the next video
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