Anirudh speaks
part two
Ever since the inception of the world's most feared militant group, things have been downhill for many. Countries are being rebuilt after an economic downfall, markets have lost huge shares, companies are drawing straws on whom to retrench unable to pay for the losses, employment is going for a toss, psychologists are in demand owing to an emotional break down for those having lived through what they say was a nightmare, governments are being questioned at every step they take and at every measure taken to curb the lack of safety and security.
Albeit the aftermath doesn't imitate a war-torn place- which is a very good thing- it has shown us how a country might look like when its government is at it's brink and clutching at the last threads of it's economy. Now explaining how terrorism and economy are related shouldn't be a difficult task owing to the fact that they indeed go hand in hand.
(Before I move on further, let me just confess that I am not bussiness-literate. So any ambiguities encountered while reading this post is due to my sheer lack of knowledge in the ''bussiness and markets studies''. Throughout this article, I survive solely beacause of the facts that are at my disposal, though scattered everywhere in the internet. Also, in a lot of instances while talking from an economic point of view, I would have explained the concepts involved by keeping the Indian Economy as my base because, it is after all, the biggest economy and as the old saying goes- "Indian economy is the best economy". So, if there are any corrections or ambuguities that catch your eye, kindly bring it to my notice via the comments below ).
It has been estimated that the death toll from terrorism has risen from a meagre 3K to a staggering 32K in a span of a decade. Like I had said in part one of this post, the world IS falling apart, piece by piece. Every time a city is hit by terrorism, in addition to accounting for the losses in the precious and innocent lives, the government has to compensate for the loss in property and thus occurs an economic crisis when that government gasps out of lack of funds to repair the damages caused. If the country has a proven track record of a poor GDP, then in my opinion, it's close to 'game over' for that country unless drastic measures are taken. These can be in the form of inceasing the taxes levied on the commodities, in the prices of public trasportation and the like. It is a well known fact that markets detest uncertainty and when it comes to shares and stock, uncertainty may be your worst enemy. However, it has been observed that these markets, though experience an intial downward phase, have risen up from the depths quickly despite a glum economy. This is where effective advertsing comes into play. For example, post a terrorist attack, a certain brand of band-aids may experience an increase in the number of orders by hospitals, or a certain brand of packaged bottled water might begin selling with a promise that a majority of the money spent on this product goes to support the affected parties. So, that brand, in addition to selling their product, have managed to advertise for the cause with a minimal expense. Now this seems like what I would call- "opportunist marketing in a negative way" (slick name, yes, but this is the best I could come up with). It may seem like taking advantage of a situation such as this, but I guess that is how markets work. On the other hand, effective advertising has some good to it too- it helps the affected through charities and donations- so hasn't this balanced out the negative?
Stock has always been a form to gauge a country's economy. However, attacks by lone-wolves (a single person executing an act of terror under no one's orders or command but by a sheer personal thought to cause harm to others) have not proven to literally bring down the stock and eventually the economy- they merely cause a dent or at the least, a scratch that is quite easily recoverable. But consider a well coordinated attack by a jihadist militant group, like the 26/11 in India or the 9/11 in the US. The following are the most plausible steps that would be taken post the attack-
Exchanges would be closed for the next forthcming days post a curfew being instated resulting in a quick loss for a lot of companies. The worst affected would be the emerging companies and the start-ups. The giants in the bussiness would encounter a loss of a few billion dollars. Many of them would begin playing the safe game by selling the majority of their stock holdings and seeking safe haven. The shares on sale might hit a dead-end when no one is willing to take the risk. The curfew instated would result in thousands of workers refusing to leave the safety of their homes eventually causing a massive decline in product manufacturing. Thus, that company encounters a loss because of the raw materials bought that are now stored for an uncertain time period. The company would have probably bought them on loan from banks, but without a ''demand ad supply", their revenue goes down and they re consider paying off the debt to the bank. In addition to this, they have to shell out money to merely store the raw materials and protect them from destruction, as purchase of fresh materials seems next to impossible. Banks would face a huge crisis what with the companies refusing to pay off their debts, because of a looming economic slow down and the insurers, concern on the insurance claims. But all is not gloomy. With companies selling their stocks in an attempt to save themselves from sinking into the abyss, the national treasury would prove to be the ultimate safe haven and their appeal simply increases. If this economy spirals further downward, then that country's currency banks down and begins losing it's value, thus affecting the imports and exports. Allies would refuse to export their products citing low profits. The general economy of the country would however depend on the scale and magnitude of the attack. The sectors that would be the worst affected would be the entertainent, restaurants (food & dining), travel and tourism, airlines and the automobile sectors. The general consumer staples and pharma industries would observe a good increase in their profits and their "demand and supply" would sky-rocket. In the end, the worst case scenario would lead to an eventual, impending global recession. This in turn affects the education and employment sector too.
Wow! One act of terror! One... the result is a Domino effect. It is things like these which initially caught my attention. While trying to find a pattern in the attacks of the now famous jihadist militant group, I could come up with just one possible pattern and it seems a bit too obvious. They specialised in attacking only those places that are most crowded. That is enough to make it to the internationl headlines. It was at this moment that it hit me, What if they wanted just this? What if all they wanted was to be known? Everyone wants to be seen, to be heard. What if their plan to excecute their caliphate ideology was by first making themselves well known to the people and second by striking fear into their hearts? A fear so deep and chilling, it brings thoughts of an impending death when encountered first hand. What if their method to excecute this plan was by bringing down a government first and then turning the people against themselves and the governments? Maybe the only method with a high success rate to collapse a government is by creating an economic famine! It all sounds a bit too cinematic, agreed. The attack in Paris however, did not fit this pattern. That seemed more like an attack of vengeance. You see, when you turn back the pages of Paris's history, you will find that France used to appease a few jihadist groups much to everyone's shock. This however did not last long and France soon realised the true face of these militant groups and paid the price of their stupidity. It was at this moment when they were backstabbed or rather, betrayed, did France resolve to have one of the most powerful army and defence forces. And they did just that. However, the society at that time was against expressing the jihadist religion in public and this also included an aversion to women's clothing (as per their religion). Thus, this attack in Paris on Nov 2015, seemed more like an act of vengeance for creating a society as mentioned. Nothing has been completely proved, however, and these are just theories.
Well, these are just my thoughts, my opinions and my take on this topic. Feel free to comment on what you think, in the comments below. As a closing statement, I would like to say that I am not against any religion or country for the society that they have. I have merely used the facts already found in the internet and added my take rearding this theme. Seriously, hell was literally unleashed on Earth in the Paris attack and in other instances around the world. No one would want the Devil to walk the Earth again...
