Preparing for a New Economic Reality
The world finds itself in the depths of a Global Economic Crisis. Despite the fact that the crisis was evident in the USA in late 2007, the mining industry boomed into the second half of 2008 running at full capacity with record prices and firm expansion plans. Once the mining resource sector became aware of the crisis they reacted mechanically with inadequate consideration for longer term economic growth impacts. It has been argued by others, and we concur, that only approximately 30% of the expected negative impacts of the recession are real, while approximately 50% is perception (fear) based, with 20% driven by business and economic opportunities. This is confirmed by the fact that prices are still higher in real terms than in previous periods of economic downturns.