01 April 2009

These are uncertain times

“The consequences of our actions are always so complicated, so diverse, that predicting the future is a very difficult business indeed.”
– Professor Albus Dumbledore, speaking to Harry Potter about the Time-Turner at the end of J K Rowling’s book Harry Potter and the Prisoner of Azkaban

While President Obama has been busy trying to revive the failing US economy, I’ve been busy dodging in and out of various corporate ‘measures’ which my company is taking in order to meet the needs of the future. Restructuring, reorganising and rationalising have been in full swing for the past few months, and some results are already in view: my CEO loses his job, my head of digital strategy is appropriated by my corporate office, and my restructured pay comes into effect today.

As I stepped into a new financial year this morning, a friend in a senior position in a leading telecom company in India called to reiterate the fact that the economic downturn has come down hard on his company and the telecom industry in general. Apparently, in his business, existing clients have delayed their renewals or renewed their contracts at substantially lower fees; prospects have either walked away or are delaying their decisions to purchase; and a few projects have been abandoned under a credit squeeze.

These scenarios are probably true for most businesses and countries around the world. But, the heartbreak for most people is the fact that nobody seems to be able to predict an accurate picture of what lies ahead.

Globally, it seems, the demand for, and hence the value of, every type of asset (including intellectual property) is falling and it is uncertain if this trend will be reversed soon. This fall in demand is creating a downward pressure on incomes from those assets, leading to losses in businesses, jobs and demand for talent (an artist I met recently is selling his paintings at one-third of what similar paintings have fetched him last year)… which, in turn, are steering economies towards a world of unhappy minds and empty stomachs.

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