Your increases in production tend to be limited unless you
invest proportionately because of diminishing returns to scale.
Recession existed because of the bubbles in the economy. The
prices grossly over-valued the goods and services and when the day
of reckoning comes, boomz~!
Bubbles are not the same as the business cycle...
Anyway, food is getting more expensive, that's for sure. Because
of lack of investments. Fundumentally it would be because of the
increasing pressure on the planet.
Oil is the crucial factor. Because it represents the red blood
cells that keep the world economy functioning with the constant
movement of goods.
Indonesia is already a net oil importer and Malaysia would soon
become an net oil importer as well.
Of the largest 21 giant oil fields, 9 are in decline production
yet oil demand continues to rise.
Major oil field finds are going to be located in more and more
hard to reach places, accompanied by increased cost of production
and subsequent price increases in commodities.
With population increase, it would weaken the economy's ability
to absorb Black Swan Events (hurricanes, earthquakes, major wars,
civil wars..etc). Meaning it would be harder and more difficult for
prices to recover, prolonging recession.
I don't deny that there are a lot more factors that i don't know
at play. but considering that how much the whole global economy is
dependant on fossil fuels and how much consumption is only going to
increase with the growing population i find it hard to ignore that
it would be a major source for inflation.
