How Does Gridlock Apply to the Investment World?

by Investing School on March 19, 2012

It is certain you have heard the term gridlock before. It is unlikely, however, that you have associated the word with your portfolio. That is because gridlock is usually applied to political or traffic situations. It remains just as valid a term when considering certain aspects of business, investment or other financial matters.

The concept of gridlock really doesn’t change much when applied to the business world. It defines a position where an entity is no longer able to function normally as a result of conflict or complex difficulties taking place within the administrative ranks or a pending change in the business itself. A not uncommon cause of gridlock within a business is when two groups become embroiled in an attempt to gain dominance throughout the organization. The conflict can become so disruptive as to effectively stop any productive work from being accomplished.

From a personal perspective you can also achieve investment gridlock. This can occur when you have so many choices, and are faced with so many decisions regarding your investments that you simply do nothing. While it might be nice to let your investments take care of themselves, they won’t. Consistent attention to detail will keep your money working for you in a productive manner.

Gridlock in other financial areas can also lead to gridlock within business communities and investment opportunities. When the government is struggling to define its role the market may not know how to react, and gridlock results. The stock market may seem to be spinning its wheels, not really going up or down.

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