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The Downturn Revisited – Preparing for Nessie

The economy has understandably been at the forefront of leaders for the last twelve months or so, and probably will be so in 2010. The economic situation is one of many subjects The Academy has experts on. For more visit
Rohit Talwar is CEO of Fast Future. He is a Global futurist, award winning keynote speaker and change catalyst working with international corporations and governments to create ‘fast insights into alternative futures’. He has worked on six continents – helping him take a truly global perspective. In January, Rohit wrote for The Academy for Chief Executives Newsletter on Fresh Business Thinking about the Recession and how it might affect businesses in 2010.

Rohit notes that “While most of the European Union countries have officially pulled out of recession, the UK is still struggling to launch (NOTE – it has now pulled out but by the slimmest margin) and President Obama is issuing ever-starker warnings about the risk of a double dip recession. Conversations with investment bankers and those with connections ‘on the inside’ of the banking system are all suggesting the potential for a massive collapse that could make the last two years look like a minor correction.”
Rather than a double dip, Rohit’s view is that we are looking at more of a roller-coaster decade in which we will see regular rises and falls in different economies around the world. His colleague Ian Pearson refers to this as a ‘Loch Ness Monster’ downturn – with uneven peaks and troughs emerging with very little warning. As a result, the pain will be felt quite unevenly. “Those economies that have done most to curb or prevent their banking system from entering into huge leveraged debt transactions and complex high volatility derivatives contracts are likely to fare best – or suffer the least relative pain.”
In his full article, Rohit suggests that the most apocalyptic view came from Société Générale in its ‘Worst Case Debt Scenario’ report which warned clients to prepare for a possible “global economic collapse” over the next two years. “Under their “Bear Case” scenario, we would see a further fall in the value of the dollar, a decline in global equity prices, a sharp retreat on property values and oil would fall to $50 a barrel in 2010.“
Dealing with such an apocalyptic scenario will not be easy. As Rohit suggests, “Hope, head in the sand and betting it all on number 36 on the roulette wheel are probably not the most sustainable solutions.” He offers, as an alternative, six ideas from Fast Future’s report on ‘Winning in a Downturn’: [Read more]

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