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- Herausgeber: Business Book Summaries
- Kategorie: Fachliteratur
- Sprache: Englisch
The must-read summary of Lakshman Achuthan and Anirvan Banerji's book: "Beating the Business Cycle: How to Predict from Turning Points in the Economy".
This complete summary of the ideas from Makshman Acuthan and Anirvan Banerji's book "Beating the Business Cycle" shows that many people now assume the business cycle has been mastered, and there is no need to worry about economic recessions or recoveries any more. This point-of-view, however, might be overly optimistic. The economy will continue to rise and fall in the future, and those who accurately forecast these future turning points will have the greatest opportunity to position themselves advantageously. This summary gives concrete advice on how to use the ebbs and flows of the general business cycle advantageously. It will help you break from the pattern of basing economic decisions on the recent past, and will show you how to use a decision-making framework that can see through the delusions of the crowd, and anticipate the next turn in the economy.
Added-value of this summary:
• Save time
• Understand the key concepts
• Increase your business knowledge
To learn more, read "Beating the Business Cycle" and make accurate decisions.
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Seitenzahl: 37
Veröffentlichungsjahr: 2013
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Book Presentation: Beating the Business Cycle by Lakshman Achuthan and Anirvan Banerji
Summary of Beating the Business Cycle (Lakshman Achuthan and Anirvan Banerji)
Book Presentation: Beating the Business Cycle by Lakshman Achuthan and Anirvan Banerji
Book Abstract
In light of the longest bull run in history which lasted for most of the 1990s, many people now assume the business cycle has been mastered, and there is no need to worry about economic recessions or recoveries any more. This point-of-view, however, might be overly optimistic. The economy will continue to rise and fall in the future, and those who accurately forecast future these future turning points will have the greatest opportunity to position themselves advantageously.
“Since 1790, the U.S. economy has experienced forty-six business cycles. Time and again people came to believe that business cycles had been banished, only to be surprised by a new recession. No sooner had Mark Twain written about the ‘Gilded Age’ in 1873 than a depression enveloped the economy. In the twentieth century alone, we’ve seen three periods hailed as ‘New Eras’. As remarkable as it may seem, every so often we fall into the trap of believing that some new innovation, technology, or policy has paved the way for a New Era of endless prosperity, where risk and downturns are a thing of the past. It is from these heights of certainty that we tend to crash to the depths of despair, where risk seems to lurk around every corner. Neither extreme is realistic. Cycles always turn: the questions is when. While every cycle need not exhibit a spectacular boom or bust, it is a sure bet that you will see more recessions and recoveries in the future. Whether a mild recession or a major depression lies ahead, you can be forewarned and forearmed, protecting your interests by staying ahead of the crowd.”
– Lakshman Achuthan and Anirvan Banerji
To use the ebbs and flows of the general business cycle advantageously:
Learn how and why the economy expands or contracts.If you understand what contributes to the growth or contraction of the broader economy, then you’ll be more finely attuned to taking notice of business developments which will impact on the economy as a whole.
Get familiar with the leading indicators of the economy.These are the various indexes which will signify when a turning point of the economy has been reached. There are a large variety of publicly available indexes which can and should be used. Learn how to harness these to good effect.
Develop an “economic dashboard” – your own early warning device for turning points in the economy.Actively track what’s happening in the economy and where it’s headed next. As the cliché goes, to be forewarned is to be forearmed with everything you’ll need to act intelligently.
“Like it or not, our assessment of the future is colored by emotion. Subjective interpretations are driven by both the recent past and the prevailing wisdom, and will always lag at economic turning points. When the next recession hits, most people, oblivious of the turn in the cycle, will make the same mistakes as before. In the same way, we may fail to take advantage of the next boom in the economy. To break from this pattern of basing economic decisions on the recent past, you need to use a decision-making framework that can see through the delusions of the crowd, and anticipate the next turn in the economy. Good judgements are easy to make after the fact. But it is difficult to make the right decision in the heat of the moment. When it comes to gathering information for making decisions, most of us rely on sources that reflect the consensus view. Yet the consensus has a dismal record of spotting turns in the road ahead. Prevailing wisdom on the economy is delivered to you by the news media, whose ratings depend on the excitement that extreme views generate. Politicians and business leaders with their own agendas contribute to the hype. As with most things in life, ultimately you need to watch out for yourself.”
– Lakshman Achuthan and Anirvan Banerji
About the Author
LAKSHMANA CHUTHAN is managing director of the Economic Cycle Research Institute, a private research group which analyzes business cycles and sells its research to Fortune 500 companies, major fund managers and government agencies.
ANIRVAN BANERJI is director of research at the Economic Cycle Research Institute.
The company’s Web site is at www.businesscycle.com
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