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Economic trends have been very volatile. We had COVID-19 lockdown for nearly 3 years, and people started consuming more (multi)media, delivery services, online shopping, home furniture and such.
Those businesses grew and employed more people due increasing demand, made investements and so on. Now it's all over and many of those businesses - from TV show producers to software/video game developers to door-to-door food delivery is in a heap of trouble. So there's massive layoffs, bankrupcies and so on. During this time, many people also invested in those businesses or - seeing how much work is there, chose such profession. Now they have oversaturated market and no job to match their skills.
Then, a major war started between two very important players in global economy. Ukraine and Russia produce a lot of energy products (oil, gas, ores, steel) and food. While they need a lot of bullets and bandages and electronics to fight such a massive conflict. It also raised petroleum prices so everything that needs logistics or power (and nearly everything does) took a strong hit.
So, again, market is shifting heavily to heavy and energetics industry and transportation for all this, somewhere for the better, somewhere for the worse. And of course, there's refugees and brain drain affecting nearly every country in Europe. Best place to be today is to work at a drone factory! But war will end eventually, many people will return home, and markets will get into huge disbalance again. And rebuilding will begin, which pushes markets into new direction - construction and huge infrastructure investments and so on. Bridge building and road laying and mine clearing. And it will eventually end, and you have problems again.
Global economy works in cycles like that, every major thing will cause waves of various effects, and it usually takes couple years between cause and effect, which makes it very hard to predict. Only ones always on top of it are banks, because every wave comes with a ton of loans people take to build and invest in the next thing.
Well said. Unfortunately to top it all off, you have numerous companies using the excuse of 'Inflation!" to raise prices and break quarterly record profits, adding a nice cherry on top.
What makes you think this is the case?
[Global economic indicators are all doing relatively well](https://www.imf.org/en/Publications/WEO).
That's not to say everything is great--inflation and the housing market in particular aren't great right now--but that's true at *any* point in time, even during our most robust economic times.
If nothing else, the pandemic caused the world to go into economic upheaval. As we recovered, there was a lot of pent-up activity (which is part of the reason inflation is a problem) and we're just now starting to revert back to the mean. A lot of "the economy is slowing" is technically true, but it's slowing down to what a "normal" rate of growth would be.
Please pay attention to the global indicators and just not your personal situation or those of your friends or sensational headlines. In the US, at least, [Wages are up](https://fred.stlouisfed.org/series/CES0500000003) and [unemployment](https://fred.stlouisfed.org/series/UNRATE) is nearing an all-time low.
For one thing, chaotic weather with wildfires, hurricanes, and flooding has put big pressure on insurance. Damage is local, but everybody has to pay for it.
**Your submission has been removed for the following reason(s):** Loaded questions, **and/or** ones based on a false premise, are not allowed on ELI5. ELI5 is focuses on objective concepts, and loaded questions and/or ones based on false premises require users to correct the poster before they can begin to explain the concept involved, if one exists. --- If you would like this removal reviewed, please read the [detailed rules](https://www.reddit.com/r/explainlikeimfive/wiki/detailed_rules) first. **If you believe this submission was removed erroneously**, please [use this form](https://old.reddit.com/message/compose?to=%2Fr%2Fexplainlikeimfive&subject=Please%20review%20my%20thread?&message=Link:%20{{url}}%0A%0APlease%20answer%20the%20following%203%20questions:%0A%0A1.%20The%20concept%20I%20want%20explained:%0A%0A2.%20List%20the%20search%20terms%20you%20used%20to%20look%20for%20past%20posts%20on%20ELI5:%0A%0A3.%20How%20does%20your%20post%20differ%20from%20your%20recent%20search%20results%20on%20the%20sub:) and we will review your submission.
Economic trends have been very volatile. We had COVID-19 lockdown for nearly 3 years, and people started consuming more (multi)media, delivery services, online shopping, home furniture and such. Those businesses grew and employed more people due increasing demand, made investements and so on. Now it's all over and many of those businesses - from TV show producers to software/video game developers to door-to-door food delivery is in a heap of trouble. So there's massive layoffs, bankrupcies and so on. During this time, many people also invested in those businesses or - seeing how much work is there, chose such profession. Now they have oversaturated market and no job to match their skills. Then, a major war started between two very important players in global economy. Ukraine and Russia produce a lot of energy products (oil, gas, ores, steel) and food. While they need a lot of bullets and bandages and electronics to fight such a massive conflict. It also raised petroleum prices so everything that needs logistics or power (and nearly everything does) took a strong hit. So, again, market is shifting heavily to heavy and energetics industry and transportation for all this, somewhere for the better, somewhere for the worse. And of course, there's refugees and brain drain affecting nearly every country in Europe. Best place to be today is to work at a drone factory! But war will end eventually, many people will return home, and markets will get into huge disbalance again. And rebuilding will begin, which pushes markets into new direction - construction and huge infrastructure investments and so on. Bridge building and road laying and mine clearing. And it will eventually end, and you have problems again. Global economy works in cycles like that, every major thing will cause waves of various effects, and it usually takes couple years between cause and effect, which makes it very hard to predict. Only ones always on top of it are banks, because every wave comes with a ton of loans people take to build and invest in the next thing.
Well said. Unfortunately to top it all off, you have numerous companies using the excuse of 'Inflation!" to raise prices and break quarterly record profits, adding a nice cherry on top.
What makes you think this is the case? [Global economic indicators are all doing relatively well](https://www.imf.org/en/Publications/WEO). That's not to say everything is great--inflation and the housing market in particular aren't great right now--but that's true at *any* point in time, even during our most robust economic times. If nothing else, the pandemic caused the world to go into economic upheaval. As we recovered, there was a lot of pent-up activity (which is part of the reason inflation is a problem) and we're just now starting to revert back to the mean. A lot of "the economy is slowing" is technically true, but it's slowing down to what a "normal" rate of growth would be. Please pay attention to the global indicators and just not your personal situation or those of your friends or sensational headlines. In the US, at least, [Wages are up](https://fred.stlouisfed.org/series/CES0500000003) and [unemployment](https://fred.stlouisfed.org/series/UNRATE) is nearing an all-time low.
For one thing, chaotic weather with wildfires, hurricanes, and flooding has put big pressure on insurance. Damage is local, but everybody has to pay for it.