Business Cycle Watch Showing It’s Crisis O’clock
How to Survive the Looming Economic Crisis
You’ve probably heard the alarming news: an economic crisis is looming, threatening our well-being and eroding our purchasing power with soaring inflation. 📈
These warnings are not exaggerated. Our economies are facing serious challenges that have various origins. But there is a way to cope with the crisis: by understanding its causes and taking action. In this article, I will show you how you can adapt and prepare for the uncertain future ahead.
It’s crisis o’clock everywhere.
Business Cycle Clock by Eurostat
But first of all, what is Business Cycle Clock?
Business cycle clock is a tool developed by Eurostat which stands for the EU statistical office that collects and analyzes crucial data on the well-being and functioning of the Union.
The current position of the watch indicates that we’re in trouble. The orange section of the watch means a slowdown or decline in economic growth. But there is another important dimension shown by the watch: we’re at a turning point.
we’re at a turning point.
From now on, it is up to us to decide whether the hand will move up in green or red. The time is ticking so let’s start with the causes.
Time Causes
One of the roots of the current crisis is just the accumulation of previous crises. Since 2008, the EU has faced at least four major crises:
- World Financial Crisis in 2007–08
- Sovereign Debt Crisis in 2010–11–12
- COVID-19 pandemic in 2020–21–22
- Crisis Caused by the War in Ukraine
Each of these crises added more fuel to the fire, as they all had different impacts on the current grim situation. The first two crises exposed the heterogeneity of the euro area, despite having a common currency. For example, look at the difference between Germany and Greece.
The following ones were more related to external shocks that strained already fragile structures. During COVID-19 there wasn’t enough money so governments printed more of it. When the economy recovered, suddenly there was an excess of money, leading to inflation. Finally, the war in Ukraine disrupted the remaining supply chains.
As ordinary citizens, we suffered the consequences of these crises in different ways. Countries became heavily indebted, some of us lost a bunch of money on “safe” investments, but worst of all, we lost our jobs.
Time Solutions
In the current situation, two things are certain:
- future is uncertain → nobody knows what’s going to happen.
- things change very fast → what is important today, might not be important tomorrow.
If we examine this observation more closely, we may see these two statements are interrelated, or in other words, the first implies the second and vice versa.
Nobody knows whether you’ll land your dream job, and nobody knows if your skills will be relevant in the near future. So, what should we all do about it?
My opinion, and my daily practice, is to combine the conventional, secure path of growth with the skills that will be essential to thrive in the rest of the 21st century. What do I mean by that?
In the first place, if you’re pursuing a degree and planning to find a job afterward, go ahead. If you’re already working, owning a business, or doing anything else, keep doing it. BUT, complement it with the development of three skills I think are vital:
- Deep work. In the world of distractions, only one who can achieve a state of deep focus and work will be able to overcome any challenge ahead.
- Artificial Intelligence. You may not like AI but think twice. If you’re not using AI, somebody less qualified than you will take your desired position just because of using it.
- Asking questions. The only stupid questions are the ones you don’t ask, as once said Marc Cuban. With prompt engineering on the rise, knowing how to ask questions becomes even more important.
As the clock ticks towards the crisis, staying ahead is crucial. But it’s not an easy task. With these three skills, you can adapt and thrive in the ever-changing future.
That’s why I’ve created the Competitive Edge group aimed at helping people, just like you, stay ahead.
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