Sep 14

A World Tragedy: Why September Eleventh Is Still Relevant in the World Markets Today

Walking by the World Trade Center yesterday, hearing the names of the victims of 9/11, one could not help but feel an incredible sorrow and angst at the events of that day. That moment in time has done more to shape the following decade and our current lives than any singular event in our generation.  The butterfly effect of 9/11 will be felt for many years to come. Here are but a few of the ways it has affected our economy.

A Changing Mindset:

In the time leading up to September eleventh the greatest en vogue business concept was the brilliance of globalization and corporations. With globalization in place, each country in the world could profit from its country-based advantages and improve the cost and efficiency of the worldwide economy.  Corporations were not a countries’ institutions but worldwide entities that were not tied to one specific country.

After September eleventh the nationalism and call for western action changed the way business was conducted.  Western companies looked to distance themselves from being viewed as simply global corporations and embraced their “roots.” Globalization was suddenly a concept that was still relevant and widely used but corporations actions and policies changed to emphasize their local loyalties. As such, many of the global developments and expansion plans for corporations and countries developments were put on hold.

Risky Economic Policy:

With the countries morale at its weakest, the signs of a recession and a potential depression were palpable. The US economy up to that point had been the worldwide model and engine of growth. The Dollar was the strongest currency and was widely held across all countries foreign reserves.

The strong dollar, along with investor unease, was among the factors that threatened to derail the US economy. It was becoming harder and harder for American firms to sell their products abroad, make a profit and compete with other global firms with a strong dollar. Many of the government’s policies were centered to devalue the dollar to give these local “corporations” the best chance to survive, grow and increase our domestic exports.

The Investor unease was also a main problem that was addressed. With a very cheap cost of borrowing provided by China, the US tried to motivate investors to spend. The housing market was the main focus and engine of the growth of this economic policy. The intention was to infuse the economy and workforce forward, however with the poor fundamental policy and planning, the plan backfired down the road. While the US and Europe did enjoy a small economic boom from the housing policy, the current consequences find the US with its worst poverty rate since 1993, an underemployment range in the double figures and an unemployment rate hovering around ten percent.

Focus On Security:

9/11 exposed some fundamental flaws in airport security. As a result hundreds of millions of dollars and numerous reforms were built to repair this problem. The trust and benefit of the doubt given to passengers could no longer be taken as a given. While many of these reforms were necessary, this diverted money from other needed domestic causes. The problem is highlighted in the declining national infrastructure, falling education and literacy world rank.

9/11 & The Future:

It is unknown what would have happened in the world’s economy if 9/11 did not occur. What 9/11 did do, however, was show us how fragile our economic ecosystem can be. In honor to those that lost their life on that mournful day we must continue to rebuild our economy and lives around solid and relevant economic and ethical foundations. What we know is, no terrorist can take away the hope for the future and if we are ever in need of a reminder of that, all we need to do is walk in the streets of New York by the World Trade Center.


1 comment

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