Vicious Circle of Poverty

The international recession has been of great concern for the United Kingdom during the past few months but unfortunately the country was itself engulfed by the same. But this was when the country was itself going through the same problems and was a victim of it itself. During the last few months, there is no problem with the United Kingdom when it comes to recession as there are no prices falling any further and investment is also a lot more stable but the spending habits of the people are still very much the same as they are more inclined towards saving than spending still.

Now this could be very much possible mainly because the businesses are not flourishing as good as an investor would like them to be before deciding to invest in there. The biggest problem is what we term as the “Vicious Circle of Poverty” in the economic terms. There are no new jobs being created, at least not at a level at which there is joblessness, and this is certainly a serious issue with the jobs as we all know. Along with this joblessness comes the deadly deflation which is mainly due to the reason that people are unable to spend.

Now when there will be no spending and the people would not be inclined towards buying, it will surely hurt the demand of the goods in the country and if there is no demand there is no need for supply which ultimately leads to joblessness because if there is no need for supply there is no reason why a factory owner would pay labourers? With limited demand there will be limited production and limited production leads to joblessness making it a deadly circle of which it is almost impossible to move out. The only way out is government funding and unless that happens the internal and external environments in the UK as well as outside it would not favour the economic conditions.

Changing Environment will Help Change Spending Habits

The business is the main thing on which the economies of the countries survive as there are very few countries in the world that have enough mineral resources that they do not even need to promote business activities in the world. Even the Middle East countries which are considered to be the richest in mineral resources have been trying their best to improve and create the environments in their countries for business and commerce. Same is the case with the United Kingdom which is considered to be one of the most business friendly places in the world and the wholesale suppliers in the country have always enjoyed the fruits of their hard work.

This has been possible only due to the fact that the governments as well as the people of the country are prone to innovation and have a great taste in their liking and disliking of the good and bad wholesale products. This certainly helps an entrepreneur and a small businessman as they always get a good feedback if they do good as the UK public does not refute a business just because it does not have a big brand name behind its back. This makes the UK one of the most favourable places for the business community and the investors from all parts of the world.

All these signs indicate that the UK wholesale suppliers have a great enabling environment in this country and their performance should be great in such a climate but unfortunately this is just one side of the picture and the other side is of course the slow recovery after the recession that enveloped the entire country throughout the last three years. The recession has ended but the people have not been able to change their buying and selling habits and that has been the main reason why the situation of the economy is still not quite the way it should have been. But the recent steps taken by the government that includes the opening of a new bank for handing out loans to the small businesses will hopefully prove good for the economy.

There is no doubt about it that the UK economy has a great potential and the London City which has always been famous for great business activities will surely be able to pull it back in a few more months. The passage wouldn’t have been long enough, had the banks been a bit less stubborn in their approach towards the small and medium sized businesses but nonetheless the situation is getting better and there is a strong hope that as the businesses will be promoted and the joblessness will decrease with it, the spending habits of the general public will also get better and the British economy will be back where it was before the recession’s hitting the global business.