Is risk bad for the economy?
Over the last few years we have seen many reviews of risk in the UK financial arena and the impact this can have upon the UK economy. In many ways you could be forgiven for assuming that all risk is bad and by reducing the level of risk in the UK we will in some way ensure a better standard of living and a more stable financial arena. But is this really correct?
The truth is that without risk there would be no growth in the UK economy, there would be no property purchases, there would be no new businesses sprouting up and there would be no finance from the UK financial arena. Controlled risk is evident in every element of life whether this is financial, social or employment and the sooner we appreciate this, the better for all. The problem for the UK economy over the last few years has been an imbalance in the risk/return ratio which ultimately led to the credit crunch and the worldwide economic downturn.
Without certain elements of the worldwide business arena taking some form of risk there are many business and financial tools available today which would never have been "found". Risk is evident in all forms of life but when this moves towards uncontrolled and unbridled risk, this is where the problems begin.
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