The global economy has faced numerous challenges in recent months, raising the likelihood of a potential collapse. However, with several analysts maintaining that the collapse is inevitable, the precise timing of such an event remains uncertain.
Amidst these circumstances, generative artificial intelligence (AI) systems have gained traction, particularly in projecting general financial markets forecasts. Joining the ranks is Google’s latest innovation, Bard.
In this line, on May 27, Finbold asked Bard if the global economy would collapse in 2023. The tool emphasized that determining the likelihood of a collapse, specifically in 2023, remains uncertain but highlighted several factors that could contribute to such a scenario.
According to Bard, key indicators of a potential collapse encompass high inflation, the ongoing war in Ukraine, and the upward trajectory of interest rates. This comes as economies such as the United States have recently witnessed unprecedented inflation levels, prompting the Federal Reserve to implement interest rate hikes to address the situation.
Lack of consensus on economic collapse
The tool noted that if the headwinds continued, it would lead to a collapse. According to Bard:
“The severity of the recession would depend on several factors, including the length and severity of the war in Ukraine, the pace of interest rate hikes by the Federal Reserve, and the strength of consumer and business confidence.”
Bard also recognized the absence of a consensus among economists regarding the potential occurrence of an economic collapse in 2023. It emphasized that it is currently too early to make definitive statements on the matter.
“As of today, there is no clear consensus among economists about whether the global economy will enter a recession in 2023. Some economists believe that the economy will continue to grow, albeit at a slower pace, while others believe that a recession is inevitable. The truth is, it’s too early to say for sure,” the tool added.
The tool also provided insights on how to navigate through an economic collapse. It stressed the significance of creating an emergency fund, effectively managing debts, enhancing one’s value in the workforce, and maintaining a positive mindset.
Signs of economic collapse
Significantly, there are observable signs of an economic collapse starting to emerge, as Germany recently slipped into a recession. As the largest economy in Europe, the nation entered this downturn partly due to the impact of high gas prices from the previous year, which began to affect consumer spending.
Indeed, several global economists are warning about the possibility of an economic collapse, with the Federal Reserve projecting a possible mild recession. Adding further complexity to the situation, the United States is grappling with the possibility of a default as the debt ceiling crisis unfolds. This has raised concerns among several industry participants who warn that the country could be the next to face potential repercussions.
Finbold reported that Mike McGlone, Bloomberg’s senior commodity strategist, strongly asserted that all indicators point towards an inevitable severe economic recession. McGlone highlighted that the economy is “tilting” towards a recession, citing factors such as the Fed’s tightening policies, including implementing interest rate hikes.
Attention has shifted towards identifying safe haven assets that can protect the face of an impending economic downturn. Notably, Robert Kiyosaki, renowned author of the popular personal finance book ‘Rich Dad Poor Dad,’ has recommended investing in assets such as gold, silver, and Bitcoin (BTC) to navigate a crisis.