Recession fears grow in the global economy

Economic managers continue to warn of a possible global recession amid geopolitical tensions.

Although fears about a recession, which is the name given to the ‘contraction’ or ‘contraction’ of the economy, diminish over time, the decline in economic activity due to the high interest rate environment and rising of geopolitical tensions can keep this concept in the air. agenda for a long time.

GEOPOLITICAL TENSIONS ARE AFFECTIVE

Finally, Wall Street executives and economic officials also put the recession back on the agenda. Economists said conflicts in the Middle East could cause energy prices to rise and consumer confidence to decline globally.

Experts have warned that if those fears continue to rise, the likelihood of a recession in both Europe and the United States will increase significantly.

These warnings from Wall Street leaders also emphasized the potential economic effects of ongoing geopolitical crises. According to experts, if these problems are not resolved as soon as possible, the world could be on the brink of the most serious crisis since World War II.

WARNING FROM WALL STREET LEADERS

Jamie Dimon, chairman of America’s largest bank, JP Morgan, told the Sunday Times last week that the combination of Israel’s war against Palestine and the war between Russia and Ukraine is quite frightening and unpredictable.

“What’s happening on the geopolitical front right now is the most important thing for the future of the world,” Dimon said.

BlackRock CEO Larry Fink also said that the combination of Israel’s attack on Gaza and the war between Russia and Ukraine could lead the world into a completely new future in terms of the global economy.

Fink said: “Geopolitical risk is an important element that shapes all of our lives. All over the world we have more and more fear and less hope. Increased fear generates abstinence in consumption or greater spending. “Therefore, fear creates a long-term recession, and if fear continues to increase, the possibility of Europe and the United States going into recession increases,” he said.

BOE PRESIDENT: WE MUST BE CAREFUL

Bank of England Governor Andrew Bailey noted that new blocs have formed in the global economy due to crises such as the Covid-19 epidemic and the war between Russia and Ukraine, and said: “We must be careful about pressure from disintegration in both the global economy and the financial system.”

Speaking at the “2023 Financial System Conference” held in Dublin, Bailey stated that currently monetary policy is quite restrictive and economic growth forecasts are very low. Bailey said they do not foresee a recession, but growth will remain stable.