GHANA RESEARCH

THE CORONA VIRUS AND THE ECONOMY IN GHANA
PEOPLE TALK MUCH ABOUT THE EFFECT THE CORONA VIRUS WILL HAVE ON THE ECONOMY IN GHANA. AS UNDERSTANDABLE THIS DISCUSSION MIGHT BE, IS IT REALLY NECESSARY/ AND MORE IMPORTANTLY, WILL THIS DISCUSSION CHANGE ANYTHING?

IT IS TRUE THAT THE PANDEMIC HAS A STRONG EFFECT ON ECONOMIES WORLDWIDE. COMMODITIES, INCLUDED COCOA, HAVE GONE DOWN. OIL PRICES PLUNGED, AND STILL PLUNGE, IN RECORD SPEED. EVEN, THE GOLD PRICE HAS GONE SOUTHWARDS IN RECENT DAYS, THIS IS AGAINST ALL EXPERIENCE WE HAVE FROM OTHER CRISES. THEREFORE, ALL THAT SHOWS THAT THE CURRENT HEALTH CRISIS HAS AN IMPACT ON ECONOMIC DEVELOPMENT WORLD WIDE. BUT, CAN WE CHANGE THAT?

YES, WE CAN!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

BUT NOT BY DISCUSSING PERMANENTLY HOW THE CORONA VIRUS AFFECTS THE ECONOMY IN GHANA. WE CAN ONLY CHANGE THE IMPACT OF THE CRISIS ON THE ECONOMY BY FIGHTING THE CRISIS ITSELF. WE DEFEAT THE CRISIS SUCCESSFULLY, THE REBOUND OF THE ECONOMY WILL COME ALMOST AUTOMATICALLY.  NEW INVESTMENTS WILL FLOW INTO ANY COUNTRY WITH A STABLE DEMOCRACY.  AFTER A BIG PLAGUE HIT GREAT BRITAIN SOME CENTURIES AGO, THE END OF IT WAS THE START OF INDUSTRIALISATION  THERE. FURTHERMORE, HISTORY GIVES OTHER EXAMPLES OF A NEW BEGINNING AFTER A CRISIS, ESPECIALLY AFTER A HEALTH CRISIS.

HERE IS WHAT THE WORLD – AND GHANA – HAS TO DO:

1. DEVELOP A VACCINE AGAINST THE VIRUS AS SOON AS POSSIBLE.
2. KEEP TO THE STRICT – BUT SIMPLE – INSTRUCTIONS CONCERNING HYGIENE AND SAFETY.
3. SUPPORT YOUR NEIGHBOUR BY ADVISING HIM/HER AND STAND BY HIS/HER SIDE.
4. DO EVERYTHING TO SUPPORT THE GOVERNMENT WITH KEEPING THE HEALTH EFFECTS OF THE VIRUS DOWN.

IF WE KEEP TO ALL OF THAT, WE WILL ALSO KEEP THE ECONOMIC EFFECTS ON OUR LIVES DOWN. STATISTICS HAVE SHOWN THAT THE PEAK OF VIRUS WILL PROBABLY BE 30-40 DAYS AFTER THE FIRST APPEARANCE.

https://www.investopedia.com/

AS A CONSEQUENCE, TRY TO KEEP THE HEALTH EFFECTS OF THE CORONA VIRUS DOWN, AND YOU WILL ALSO KEEP THE EFFECTS OF THE VIRUS ON THE ECONOMY DOWN.

AS A RESULT, DON’T TALK SO MUCH, BUT ACT. 

THE CORONA VIRUS AND THE ECONOMY IN GHANA ARE VERY MUCH ATTACHED TO EACH OTHER. BUT, THE EFFECTS DEPEND ON HOW MUCH WE DO TO FIGHT THE HEALTH CRISIS.

KEEP IN MIND: CORONA PRODUCED A HEALTH CRISIS, NOT AN ECONOMICAL ONE!

 

 

 

 

GSE WEEK FROM 09-03-20 TO 13-03-20 AND CORONA VIRUS WAS SOMEWHAT BORING AGAIN.MOVEMENTS WERE WITHIN A RATHER NARROW RANGE. BUT THAT CAN CHANGE IN THE NEXT FEW WEEKS, AS THE FIRST CORONA VIRUS CASES APPEARED IN GHANA. WILL IT CHANGE?

EXPERIENCE FROM OTHER STOCK MARKETS HAVE SHOWN THAT MANY FINANCIAL MARKETS REACT ON THE VIRUS WITH MUCH VOLATILITY. REMEMBER, VOLATILITY IS DEFINED AS FOLLOWS.

Volatility is a statistical measure of the dispersion of returns for a given security or market index. In most cases, the higher the volatility, the riskier the security. Volatility is often measured as either the standard deviation or variance between returns from that same security or market index.

In the securities markets, volatility is (we)often associate volatility with big swings in either direction. For example, when the stock market rises and falls more than one percent over a sustained period of time, it is called a “volatile” market. An asset’s volatility is a key factor when pricing options contracts.

https://www.investopedia.com/terms/v/volatility.asp

THAT SIMPLY MEANS THAT VOLATILITY TS A FAST AND UNPREDICTABLE CHANGE, MOSTLY IN THE NEGATIVE. OFTEN, THE ECONOMIC EFFECTS OF THE VIRUS ONLY MULTIPLY TRENDS WHICH ARE ALREADY PREVALENT IN THE GIVEN COUNTRY. THIS IS THE CASE, E.G., IN THE UNITED STATES, WHERE THE EARNINGS OF LISTED COMPANIES WERE ALREADY ON THE DOWNTURN.

OF COURSE, THE VIRUS WILL PROBABLY ALSO AFFECT THE GHANAIAN FINANCIAL MARKETS IN ONE WAY OR THE OTHER. THIS IS ESPECIALLY TRUE AS GOVERNMENT ANNOUNCED VARIOUS RESTRICTIONS. BY ALL MEANS, THESE RESTRICTIONS WILL AFFECT THE PROFITS OF GHANAIAN FIRMS.

ECONOMIC DEVELOPMENTS HAVE ALREADY AFFECTED OUR ECONOMY NEGATIVELY. OIL PRICES HAVE GONE DOWN BECAUSE OR QUARRELS WITHIN THE OPEC+ RUSSIA AND OTYTHERS. EVEN THE GOLD PRICE WENT DOWN SOMEWHAT. IN A WAY, THAT WAS SURPRISING, AS USUALLY GOLD IS A “SAFE HAVEN”. BUT, IN THIS CASE FIRMS AND GOVERNMENTS WENT OUT OF GOLD AND WENT INTO CASH. THIS IS BECAUSE MANY OF THEM WANT TO COMPENSATE POSSIBLE LOSSES DUE TO THE VIRUS.

NEVERTHELESS, I DON’T SEE ANY REASON FOR A FINANCIAL PANIC, AS I DON’T SEE A REASON FOR A HEALTH PANIC. FIRST OF ALL, OUR CONSUMPTION SHOULD GO ON AS USUAL, ALTHOUGH WITH SOME RESTRICTIONS. WE MUST LIVE WITH ECONOMIC RESTRICTIONS FOR SOME TIME, AS WE MUST LIVE WITH HEALTH RESTRICTIONS.

ON THE OTHER HAND, ANY HEALTH CRISIS IN A COUNTRY GIVES THE OPPORTUNITY FOR A NEW BEGINNING. WE WILL HAVE NEW DEVELPMENTS WHEN THE CORONA CRISIS IS OVER. THESE NEW DEVELOPMENTS WILL GIVE NEW INVESTMENT OPPORTUNITIES. AS GHANA IS ONE OF THE COUNTRIES IN AFRICA INVESTORS PREFER, NEW MONIES WILL FLOW INTO THE COUNTRY. AFTER THE DARKNESS OF THE CORONA VIRUS CRISIS, SUNSHINE WILL COME AGAIN OVER THE GHANAIAN ECONOMY, AND THEREFORE, OVER THE GHANAIAN PEOPLE.

SO, GSE WEEK FROM 09-03-20 TO 13-03-20 AND CORONA VIRUS MIGHT HAVE A NEGATIVE EFFECT ON THE ECONOMY AND THE FINANCIAL MARKETS. BUT THAT WILL ONLY BE IN THE SHORT TERM. IN THE MEDIUM AND LONG TERM, A NEW BEGINNING WILL HAVE A POSITIVE EFFECT ON THE GHANAIAN ECONOMY AND THE FINANCIAL MARKETS HERE.

STAY TUNED FOR NEW DEVELOPMENTS!