The 2010 Fifa world cup in South Afrinca! Yes a lot of fun, beers and chips. We all know the huge effect this world cup is having on South Africa’s current and future economy; however the world cup economic haze is spreading to the whole world. The bars that show the games are PACKED all the time, people are definitely consuming more. The queues at supermarkets before games are endless, the roads are almost empty and the offices almost paralyzed!
Even our conversation changed, all of a sudden the oil spill, Haiti and the world economic crisis have disappeared, as if none of it existed! Maybe the only pre-world cup buzz that still exists is Lady Gaga who just became “the first living person with over 10 Million friends” on Facebook of course. Ooops sorry Mr. President, someone is more popular than you! Probably that’s why Mr. Bush tried to sing from time to time :P
Anyway, back to the world CUPONOMICS, yes a lot of people are benefiting from it, and it’s moving economies worldwide, but hey! what about the lost productivity caused by all the games? 80% of the population is expected to watch this month-long tournament, and it seems that football absenteeism is very accepted everywhere! And if not, anyway it will be a waste of resources for companies as employees will use the network bandwidth to live-stream the games!
So will the world cup affect our struggling economies? Some studies analyzing some financial indexes performance during and after the world cup show that: “The S&P 500 has averaged a decline of 1.65% during all 18 prior World Cups, and a decline of 0.37% in the three months following.”
So what will be the aftermath of the 2010 world cup, on South Africa and the world? Will it erase all the efforts that have been made to alleviate the economic crisis? Or on the contrary, it will benefit those sick economies? My guess would go to the more pessimistic scenario especially when it comes to developed countries. But we should wait to see, and let's hope that i would be proven wrong ;)
And now, talking about real economics, it seems that all the predictions of the big speculators have fallen short despite their very sophisticated models - with UBS and Goldman Sachs betting on Brazil, and JP Morgan on England! So who do you think will get to the 2010 Fifa World Cup Final on July 11? I would say the Netherlands against ……SPAIN??
And you, what do you think?