Economic crisis refers to a crisis that occurs in the process of capitalist reproduction. This crisis is often caused by a large backlog of products, a sharp decline in production, and the closure of enterprises. So specifically speaking of the performance of the economic crisis, how do we use the economic crisis to make money? This article will give you a brief explanation.

What are the manifestations of the economic crisis?

The general manifestation of an economic crisis is: a large backlog of goods, a sharp decline in production, a large number of factory closures, a large number of workers being unemployed, severe damage to credit relations, and the entire social economy in extreme chaos and paralysis.

Great economic crises basically appear after great economic prosperity or false prosperity. For example, in the economic crisis of 1929, Western countries experienced a long period of economic prosperity before, and the Southeast Asian financial crisis in 1997, and the relevant countries before them also experienced similar economic prosperity. Since prosperity requires the support of comprehensive national strength, some false economic prosperity formed through data falsification or food consumption can more easily lead to economic crises.

Monetary instruments have fallen into a liquidity trap and have desperately released water. It is difficult and expensive for small, medium and micro enterprises to raise funds, but the central bank continues to release money, and the entire economy is showing signs of sluggishness.

Asset prices have risen beyond rationality and have deviated from the right track, and even serious price and value distortions have occurred in one or more areas. For example, the irrational skyrocketing of housing prices in Japan in the 1980s became an important event that detonated the economic crisis.

There are frequent irregular events in the financial and economic fields, such as the distorted stock market. The rise of trade protectionism, trade conflicts or trade wars, are most likely to detonate economic crises. The scale of the economy is large, and various social and economic conflicts are severe, and it is easier to detonate an economic crisis. Of course, the larger the body, the greater the destructive power in the event of a crisis.

The phenomenon of economic crises was different before and after World War II.

But whether it was before or after the war, the common points were: unsalable goods, reduced profits, resulting in a sharp decline in production (mainly industrial production), a large increase in unemployment, underemployment and a large number of business closures, and severe damage to productivity and products And losses, the social economy has fallen into a state of paralysis, chaos, and regression. The decline in production and the surge in unemployment were the main common signs of the pre-war and post-war economic crises. The main differences between the pre-war and post-war periods were currency and financial crises. In the pre-war crises, generally deflation, falling prices, tight money supply, rising interest rates, bank runs and a large number of bank failures; and in the post-war crises, due to state intervention and adoption of inflationary policies and other reasons, from 1957 to 1958 At the beginning of the global economic crisis in China, various countries experienced abnormal phenomena of inflation and rising prices during the crisis.

The main manifestations are: a large surplus of commodities, stagnant sales; a sharp decline in production, enterprises under-operating or even closing down, and a sharp increase in unemployed workers; poor corporate capital turnover, shortage of money, rising interest rates, severe damage to the credit system, and banks declaring bankruptcy, etc. . However, after the Second World War, due to state intervention and adoption of inflation policies and other measures, production stagnation and inflation co-existed during the economic crisis.

How to use the economic crisis to make money?

To make money in an economic crisis, we need to have extraordinary insights. We need to understand the source of this economic crisis, so that we can make reasonable investigations against these factors and make money in the economic crisis.

Pay attention to the rapid retreat. In the economic crisis, if we cannot grasp the market trend well, then the rapid retreat is our best choice. This way of making money is that we can protect our lives wisely, and make money to another extent by not losing money.

If we are deeply caught in an economic crisis, then we can deploy a certain economic plan to make targeted changes through the trend of the market and the flow of personnel, so as to better cater to the trend and make money.

It can be seen that there are many manifestations of the economic crisis, and everyone can intuitively feel the various economic problems that have occurred. In addition, the harm caused by the economic crisis is huge, and it can affect all aspects of life. If you want to use the crisis to make money, then you can refer to these matters mentioned earlier.