Analysis On IT slow down

By
Prateek Kr Sharma
4-B
Recession.
‡ A recession is a decline in a country's gross domestic
product (GDP) growth for two or more consecutive
quarters of a year.
‡ A recession is also preceded by several quarters of
slowing down.
Stock markets and recession
‡ The economy and the stock market are closely
related
‡ The stock markets reflect the buoyancy of the
economy
Principles reasons behind..
‡ A recession normally takes place when consumers
lose confidence in the growth of the economy and
spend less.
‡ This leads to a decreased demand for goods and
services, which in turn leads to a decrease in
production, lay-offs and a sharp rise in
unemployment.
‡ Investors spend less as they fear stocks values will fall
and thus stock markets fall on negative sentiment.
Crisis in the US
‡ The defaults on sub-prime mortgages (homeloan
defaults) have led to a major crisis in the US.
‡ Major banks have landed in trouble after people
could not pay back loans
‡ Foreclosures spread like wildfire putting the US
economy on shaky ground. This, coupled with risingoil prices at $100 a barrel,
slowed down the growthof the economy.
Impact on India
‡ Indian companies with big tickets deals in the US saw
their profit margins shrinking.
‡ The worries for exporters grew as rupee strengthens
further against the dollar.
‡ A weak dollar resulted in more foreign money to
Indian markets.
IT industry
‡ IT firms who are into core product development
might not be greatly affected by this slowdown, but
those engaged in providing only services suffered
greatly due to a less liquid market.
‡ Since IT Boom explosive growth of not-so-technically-
talented people who claimed to be IT experts just
because they had worked on a particular platform for
x years.
How to fight it??
‡ Tax cuts are the first step that a government fighting
recessionary trends or a full-fledged recession
proposes to do.
‡ The government also hikes its spending to create
more jobs and boost the manufacturing and services
sectors and to prop up the economy. The
government also takes steps to help the private
sector come out of the crisis.
Be ready for the future..
‡ true quality will help the real experts survive
this slowdown.
‡ only the toughest and strongest will survive.
‡ focus more on competency and quality.