Stock market today: biggest 3-day surge since 1931

After the Senate passed a $2 trillion economic relief package, the stock market has increased more than 1,300 bps in three days. Companies like Netflix, Google, Amazon, Facebook, and Walgreens have all jumped dramatically. There is no surprise that these companies are on the rise since many people are using these companies more because of the virus. The Dow and S&P 500 have both increased for the past 3 days, with the Dow being up by more than 20%. Even though this is a huge improvement since the LARGE drop since COVID-19 has come into the U.S., the main thing on peoples mind is if this increase is going to continue, or if this will just lead to another dramatic decrease. Many portfolios are getting hit with this drop in the economy. Do you think that the market will continue to increase, or do you think that it will once again decrease as the pandemic continues to hit the U.S.?

https://www.cnbc.com/2020/03/25/stock-market-futures-open-to-close-news.html

New World Economic Order?

As of March 25, the World Health Organisation (WHO) reported that 196 countries, areas and territories are affected by Covid-19. That brings us to the biggest worry associated with Covid-19, after its harmful impact on the human health — its long-term impact on the global economy. While most economic reports on the Internet today circle around the Western concern over the lifting of lockdown in Wuhan on April 8, an objective argument can also be made that China, as the first nation impacted by the virus, is also in the position of being the first to be able to manage the spread of the virus, and thus, resume its economic activities.There is a sense of economic solidarity in China’s move. Through the supply of medical equipment, medic teams and low interest loans, China’s economic revival strategy also caters to the livelihood of its Asian and Western trade partners. This is where the game-changing elements of Covid-19 can be found, especially in the observable shifts in global leadership and its potential impact on trade dependency and the realignment of Asian trade markets. With the strategic support given, China is effectively playing its role in reducing the economic and societal impact felt not only by its Belt and Road Initiative-friendly countries such as Malaysia, the Philippines, Pakistan and Sri Lanka, but also other severely affected Western countries like Italy and Spain. The countries assisted would not easily forget the aid given by China in their darkest moments, and this could influence their future decision on trade preferential treatment. Therefore, even while certain media are making reports on how there would be an economic shock following the resumption of economic activities in Asian countries post-Covid-19, in reality, the Asian markets have made a strategic choice of not putting all our eggs in one basket, hence ensuring that their trade operations would not be severely affected by the virus.  

For that reason, should the economic restriction in Western countries be prolonged, the Asian market could undergo a massive realignment, from serving the Western market to serving their Asian counterparts solely in the name of economic survival? 


https://www.msn.com/en-my/money/other/new-world-economic-order/ar-BB11NL9a

Asian economies may ride out the coronavirus crisis better than the West, analysts say

Investors hunting for safe spots to park their money should look to Asia now amid the current pandemic, analysts said, highlighting that the region is much more prepared economically to ride out the current crisis compared to the West. “It does make sense to tilt your portfolio towards China or towards Asia generally because the virus is moving from that region ... to the West where it is unfortunately not yet contained,” said Andrew Harmstone, a senior portfolio manager at Morgan Stanley.  

However, he pointed out that the West is still China’s biggest customer, so a global recovery will be needed for China to make a full comeback. He said the economic impact of the pandemic has hit businesses in the U.S., and many small businesses which employ about 60% of the country’s workforce  have only a month’s worth of cash flow. Severe outbreaks are not new to countries in Asia. The latest coronavirus outbreak has often been likened to the SARS epidemic in 2003, which hit mainland China, Hong Kong, and Singapore particularly hard, and plunged their respective economies into recession.That led governments to position themselves strongly for the next disaster. 

 Global interest rates are already low, with some countries already in negative territory. But central banks in Asia generally have more ammunition to cut borrowing costs to support their economies, compared to their U.S. and European peers, analysts suggested.

That implies that Asian central banks have more room to use monetary policy to boost their economies.  

“Investors should not forget that real interest rates remain positive and nominal rates even higher among many Asian and emerging markets – in stark contrast to developed markets,” said Aberdeen’s Leong. I agree with this article as Asian countries seem to be in the further through in the pandemic, they will be better off than the Western countries which are yet to face the extremes of the pandemic. 

https://www.cnbc.com/2020/03/25/coronavirus-asia-may-ride-out-crisis-better-than-us-europe-analysts-say.html

Pandemic Class Divide

This recent pandemic has obviously affected many people around the world including the U.S. A major issue that has been brought up is the wage separation gap in terms of the coronavirus. With many businesses closing and schools unable to teach anymore apart from online courses, the middle and upper class appear to be the ones least affected with the sudden change to an online system. The article states that it appears that roughly 30% of the American population does not have reliable access to internet or computers that perform on the platforms needed for online schooling systems. This lockdown has been named "the white-collar quarantine" because it is the essential blue-collar workers that are picking up the need for work and still needed in the industries during this pandemic. The white-collar people in the U.S. appear to be less affected and more capable of adapting to the changes that have come in the recent months. Unlike the lower class citizens, upper and middle class citizens are able to even build bunkers and moving to places they feel fit, while lower class people are still working and unable to do what they feel they need in order to protect themselves and their loved ones.

What do you think may be a solution to this gap in our system? Is there a solution? Will this have a long-term impact on the people in this country?

https://www.nytimes.com/2020/03/27/business/economy/coronavirus-inequality.html

House Passes $2 Trillion Aid Package

As of today, March 27, 2020, the House has voted to pass a $2.2 trillion aid package with the intention of aiding the economy and protecting the healthcare system that is vital during this pandemic. An article by New York Times states that this bill, the largest economic bailout in history, will give direct payments to taxpayers, provide jobless benefits, and give a $500 billion fund to struggling businesses. The jobless aid will include an additional thirteen weeks of enhancements of benefits. Families that makes up to $75,000 can expect $1,200 in direct payment along with an additional $500 per child. There is also an expected $377 billion in loans to businesses including airline companies and a $100 loan to hospitals that are considered to be on the front line of fighting the virus. This aid package is intended to encourage employers to keep their workers on their payroll, while also helping those who have been laid off or are experiencing cuts in wages or hours.

The article raises the possibility of more aid packages in the future. Do you think this package will be enough to stimulate the economy or can we expect more like it in the future?  

https://www.nytimes.com/2020/03/25/us/politics/coronavirus-senate-deal.html

Restaurant Workers Hit The Hardest By Coronavirus

Many servers and bartenders who have lost work amid the coronavirus outbreak are now contending with a challenging economic reality: how to make up for lost tips. Tipped employees are especially vulnerable who work paycheck to paycheck, the amount of unemployment benefits they can get has often been a fraction of what other workers can receive. The stimulus bill making its way through Congress this week will provide some much-needed relief, including a $600 increase in weekly unemployed benefits, and funds for those who normally struggle to qualify for unemployment. But a four-month boost in benefits, as the bill stipulates, may be inadequate.

Is there going to be a shortage for unemployment benefits as more and more people file after the majority of businesses have stalled operations? What is enough to satisfy individual's needs?

Fed balance sheet hits record high

The Federal Reserves' balance sheet hit a record $5.3 trillion. The two emergency lending programs are the primary dealer credit facility and the money mutual fund liquidity facility which made their first appearance on the Fed's balance sheet. Their balance sheet is expected to continue to grow in order to keep credit flowing through all corners of the financial market including Treasurys, commercial paper, and municipal bonds. In an interview with Fed Chairman Jerome Powell said there is basically no limit to the Fed's emergency lending ability.

https://www.marketwatch.com/story/fed-balance-sheet-hits-record-as-powell-says-there-is-no-limit-to-lending-power-2020-03-26?mod=economy-politics

China Tries to Restart its Economy Without Risking Lives

China was mostly shutdown in late January. Since then, the number of coronavirus cases have decreased due to their drastic measures. Now, China is preparing to restart their economy. Lockdown of Hubei province, ground zero, is being lifted. While all of this is a risky move, it will provide information to other countries on how long the epidemic will last.

China's economy has suffered throughout these past 2 months. Their GDP is predicted to fall by 9% in the first quarter. This is due to the measures they took to contain the virus. While they are preparing to restart business and production, they have to find a good balance of work and safety. The new fear is the potential of a second wave of the virus through China.

Policies and campaigns are being implemented to encourage people to go back to work, and to help prevent businesses from failing. Money is being spent on medical supplies, treatment, and infrastructure projects. This is an attempt to help promote jobs in China. Other countries will most likely follow similar policies based on how China recovers. Hopefully, China will show us how long quarantine will last.

Do you think China should continue to raise lockdowns, or wait until the virus is eradicated in China before they restart their economy?

https://www.cnn.com/2020/03/24/economy/china-economy-coronavirus/index.html

Coronavirus’ horrific toll on Ohio economy

As the coronavirus continues to spread, Ohio's economy (along with others) continue to deteriorate since the stay-at-home order has been in effect. Due to many citizens being ordered to be on lock down as well as the suggestion of social distancing to help prevent the spread, establishments such as "restaurants, bar, retail, hotel, entertainment and event businesses have been hit [the] hardest".

The closing of national restaurant chains who rely on dine-in services have hoped to survive with carry-out options with the consequence of laying off thousands of employees from that industry. The hotel industry was the first hit as well as the worst. Many resort-style resorts in the state have closed meaning that "18,700 hotel workers in Ohio had lost their jobs and another 78,000 hotel supplier jobs had been lost" with anticipation of another "17,000 industry jobs will dry up in Ohio as more hotels reduce operations or close altogether".  All in all, it has been reported that up to "139,468 Ohioans applied for unemployment help" this week and those are those that have been reported since Ohio has stopped releasing unemployment figures on a daily basis.

This is only just the beginning of the virus outbreak and as these trying times continue, unemployment rate may reach into the double digits if establishments continue to close.

https://www.dispatch.com/business/20200323/coronavirusrsquo-horrific-toll-on-ohio-economy

Comparing Coronavirus Aid Packages Around the World

With a lot of talk about the $2 Trillion Aid Package in the US, Deutsche Welle has put together a list of other aid packages from around the world. While it may be tempting to compare the amounts that each country is contributing to their economies and citizens, one must also keep in mind that the virus is affecting each country different, and the population of each varies.

First is Germany, which has approved a stimulus package worth 750 billion Euros ($814 billion), making it the first time the German government has taken on new debt since 2013. This includes 600 billion Euros for business loans and investments, and 156 billion euros in debt to finance higher social spending.

France has put out a 45 billion euro aid package for businesses and workers, with more yet to come. France's national debt will exceed 100% of their GDP in 2020, which is far above the EU guideline of 60%.

The European Commission has suspended debt and deficit requirements for members, helping less economically-stable countries like Italy to fight the virus. the European Central Bank also announced the "Pandemic Emergency Purchase Program", a bond-buying scheme worth 750 Billion Euros to provide EU member states with liquidity.

Lastly, Mainland China has yet to fight the virus economically as hard as it did during the 2008 crisis or their slowing economy in 2015. They have increased available loans to banks by 500 billion CNY ($71 billion), along with cutting interest rates for banks and large organizations.

Do you think that these stimulus packages and aid will be enough to support those heavily affected by virus? Will they be enough to get the economies of the world going again?

Coronavirus: Tump Seals Deal Worth Trillions

Trump and the Senate have finally agreed on an economic relief package worth more than $1.8 trillion dollars. The package is expected to include bail out money for industries that have been impacted by the virus, as well as measures to help people pay bills if they are laid off due to the virus. Mitch McConnell said the package would "stabilize" key industrial sectors and give money to hospitals and supplies that they may need. However, there has been conflict amongst democratic senators like Elizabeth Warren who have protested against Republican edits to who the relief package will help. Elizabeth Warren voted against the stimulus package because it did not support workers' payroll and benefits, instead she argues that the relief package only enriches the wealthy executives of giant corporations. What do you think should be included in the relief package? https://www.bbc.com/news/business-52030034

Coronavirus Recession Looms, Its Course 'Unrecognizable'

The United States today has never experience something quite like the coronavirus. The almost overnight spiral it has sent our economy into is making history. Unemployment is slowly rising from previous record low numbers and smaller businesses won’t have the savings to weather this storm. Treasury Secretary Steven Mnuchin estimates 20% unemployment in the next few months if effective intervention does not happen. Assistant professor at American University Gabriel Mathy stated this is probably the world’s first recession that started in the service sector and not the goods sector. The severity of this down turn all depends on the seriousness and length of this virus. Consumer confidence is low, consumption is low, and people are increasing their savings for another raining day. Only time will tell where this pandemic takes our economy. How do you believe the virus will impact unemployment? 

https://www.nytimes.com/2020/03/21/business/economy/coronavirus-recession.html?searchResultPosition=23

Ohio Orders Abortion Clinics to stop "Nonessential Abortions" because of Coronavirus

The Ohio Attorney General ordered abortion clinics to stop performing nonessential abortions and surgeries. This decision was made in order to preserve medical equipment for health care providers who are on the front lines of the COVID-19 pandemic. It was also done in order to preserve hospital capacity for those who are infected. A spokesperson for the Attorney General expressed that the term "non-essential" describes any procedure that can be delayed without risking the current and future health of a patient. Furthermore, the White House recommended canceling all other non-essential surgeries nationwide. There is currently a "stay at home" order in the State of Ohio and 247 confirmed coronavirus cases.https://www.cnn.com/2020/03/22/us/ohio-abortion-coronavirus/index.html

Global economy will suffer for years to come, says OECD

Angel Gurria, who is the secretary-general of the OECD has said that this economic crisis caused by the COVID-19 will be bigger than the 2001 terror attacks and the 2008 financial crisis. He said: "And the reason is that we don't know how much it's going to take to fix the unemployment because we don't know how many people are going to end up unemployed. We also don't know how much it's going to take to fix the hundreds of thousands of small and medium enterprises who are already suffering."Governments around the world have been taking unprecedented actions to support the workers and businesses during this outbreak.

So, how much do you think this global outbreak is going to last and how big of an impact do you think it will have on the global economy?

https://www.bbc.com/news/business-52000219

How covid-19 is interrupting children’s education

In an article published by the Economist, an in depth look is given to how children around the world are going to be affected academically by covid-19. We hear a lot about how this virus is affecting students in the US and we see personally how we are being affected day after day but it's also important to consider how children are going to be affected globally. Time spent in school can be beneficial to students and every second counts but on the other hand online learning may be a blessing in disguise for children who attend school in less fortunate areas.
How much do you think to virus is going to affect students globally and what do you think the repercussions will be to the public education system?

Coronavirus Fallout Puts Italy at Risk of Recession

The main epidemic area of ​​this epidemic was in northern Italy. The origin of the outbreak can be traced back to December. In fact, Italy's early measures are very timely. On January 30 local time, Italy was diagnosed with two new cases of new pneumonia for the first time, a pair of Chinese tourists. On the same day, Italian Prime Minister Giuseppe Conte announced the suspension of all flights to and from China; on January 31, Italy declared a six-month state of emergency across the country. Everything was calm afterward, but the epidemic broke out on February 22 in an instant. The most prosperous economy in Lombardy was the first to bear the brunt. Overwhelmingly overnight, part of the reason was that no one realized that the virus had actually spread silently in Italy for a long time. According to Al Jazeera, a Milan-based hospital tested three samples of the virus from Lombardy after the outbreak and found that the virus may have occurred weeks before February 20, even before the ban on flights to and from China was issued. It already exists in Italy.

Northern Italy has always been an important economic area of ​​Italy since Italy is a tourist country. A large part of the economy comes from the tourism industry. One of the most important reasons that I think why Italy could be the area most affected by the outbreak is because of the high death toll. If there were high numbers of death rates, people were less likely to travel to Italy. There is a saying in Italy: "Be free and don't wear masks". Many articles also report the reasons why Italian people don't like to wear masks. Even when Italian President Conte urgently issued a new decree prohibiting traditional ways of meeting, such as kissing, the public doesn’t buy-in.  A young couple interviewed said: "The virus is not terrible, and we will kiss each other even if we die." Since the elderly people are more vulnerable to the virus, the aging population structure increases the risk of severe illness and death

The high-risk population in this outbreak is elderly people with underlying diseases. The aging social structure in Italy is undoubtedly worse. According to demographic data from the United Nations Department of Economic and Social Affairs, as of 2019, Italy's population aged 65 and over accounted for 23%, the highest in Europe.

https://www.wsj.com/articles/virus-onset-puts-italy-at-risk-of-recession-11583422759?emailToken=3048f583a23071952bf5e20272fa0101fIKzG+VtkvCJvapnw+Jx8kp69wgNxouYBeqLO119zRNRuUAKvb+k0cmn9AgmsVUsE42LJ1O2xOsMXmls1WlTdbdqb/dGN4LH6Cpqt3lgDJQ%3D&reflink=article_gmail_share

Before Virus Outbreak, a Cascade of Warnings Went Unheeded

As more and more news and statistics comes out about all the widespread effects of Covid-19, there is also more news coming out about where it comes from and what was done to prepare for it. This article points out that reports are showing that the US should have been much more prepared than what they were/currently are for a pandemic like this. They had done previous studies that described this exact scenario that is playing out and the administration did not do much, if anything, to stop it. With the quarantines already in effect, the economy has come to a grinding halt with consumption already plummeting, but with these kind of reports coming out, there will be another chunk taken out of peoples confidence in the economy and will cause consumption to take longer to recover. This is not a good look for the future and will hopefully be counteracted by some kind of policy to do that. What kind of policy could be put out in order for this trend to be controlled? Also, what other kinds of things should companies be doing that could assist the governments relief?

How COVID-19 is Interrupting Children's Education

This Economist article tackles the issue of school closings as a result of the coronavirus, or COVID-19. Nearly 1 billion students in the world have had schooling interrupted to some extent by the virus spreading across the globe. At the time of publish, over 100 countries have closed or partially closed their schools.

It remains to be seen if these measures will slow the spread of the virus. Countries like China and Italy have already lost thousands of lives from the pandemic, and many other countries are still at least a week behind those in the growth of their infection rate. Either way, the virus forcing governments to close down schools is maybe the better of two bad options (that and keeping them open for education purposes but risking the viral infection).

A scary statistic from a 2009 study to consider is that if schools are closed for a month, between 6% and 19% of key healthcare workers will have to stay at home to take care of their children. There are other externalities to consider from closing schools other than the obvious effect of moving to online courses.

The courses themselves are not necessarily the problem; online education has tons of potential, especially as a way to educate those in poorer areas with a lack of quality schooling (or any schooling at all). However, the middle of a pandemic is one of the worst places for the ramping up of such programming to occur. We will see if K-12 and higher education are able to handle this very tall task.

https://www.economist.com/international/2020/03/19/how-covid-19-is-interrupting-childrens-education

The Fed Wants to Loosen Rules Around Big Banks and Venture Capital

A proposal from the federal reserve would loosen the restrictions on banks ability to make risky investments with customer deposits. “ Fed Chair Jerome H. Powell said the changes would “permit banks to provide limited services to covered funds in ways that do not raise the types of concerns the Volcker rule was intended to address.” Opposition claim the move will weaken the safety net and encourage the behavior the Volcker Rule was meant to prevent. The proposed changes would allow big banks to diversify the risk and make more money. It has been said this change could potentially help small banks to get involved in investments they currently could not get into on there own now. It would also allow tax advantages when investing in startups. The biggest concern is that the big banks capital investments would fail and destabilize the banks and need government bailouts which would drive up the price of insurance and hurt the small banks.

The coronavirus economic 'disaster' scenario: Stagflation

Due to the recent increase in cases of COVID-19 and global widespread, the U.S Federal Reserve has announced that they will be employing interest rate cuts down to zero, and the Trump administration is working on unveiling a stimulus plan. The virus has resulted in a global economic shock, and financial markets have taken a deep plunge. All three U.S indexes were nearly 20% below their average highs, and Italian stocks fell over 30%. Oil prices suffered their worst day since 1991 on Monday, concluding a price war between Saudi Arabia and Russia. U.S oil prices dropped over 34%, the greatest in a four year low, and all of this has happened in a matter of days. Most economists are predicted that even thought the threat of a recession is something that can be controlled, stagflation (slow growth coupled with high prices) is a real threat. Global supply shocks, labor shortages due to the fear of the virus, coupled with slashed interest rates could be a strong cause of possible stagflation. With China slowly recovering from the virus and somewhat stabilizing, the economic disaster is slowly creeping into the United States.

https://www.cnn.com/2020/03/10/investing/stagflation-economy-coronavirus/index.html

Virus Causes World Stock Markets to Plummet

World stocks have tumbled as the coronavirus continues to spread. Today, March 9th, Wall Street had its worst day since the financial crisis in 2008. The Dow fell more than 2,000 points and London's FTSE fell 100 points in three years. More than 9,000 people in Italy have the virus and over 650 people have it in the U.S. The Italian Prime Minister announced that he will issue a nationwide containment for the country as Germany and Spain have reported cases of the virus as well. Facebook even shut down it's office in London for the time being. Many small businesses and schools have closed down as well. Many people have been pulling out of the market for safety measures, it should be interesting to see how things turn around.

https://www.nbcnews.com/health/health-news/live-blog/coronavirus-updates-live-northern-italy-lockdown-anxiety-grows-d-c-n1152886

Italy Extends Virus Containment Measures to Entire Country

Italy Extends Virus Containment Measures to Entire Country  (link)

Amidst all of the coronavirus drama, Italy has taken another step to try and contain the virus by putting the entire country on lockdown until April 3rd. Italy is the second most effected country following China due to the fact that it has the 2nd oldest aging population, following Japan. According to the article, there is allowed to be no travel outside or into the country, no public gatherings, and schools have already been closed until further notice. In addition, most businesses are required to close by 6pm.

Italy has also been experiencing riots in their prisons and protests outside of them asking them to allow amnesty to its prisoners due to the virus.

What economic consequences could you see as a result of these drastic changes? Do you think Italy will remain on lockdown until April 3rd? Can you think of a more effective way this could've been handled?

Wall Street clobbered as crude plummets, virus crisis deepens

https://www.reuters.com/article/us-usa-stocks/wall-street-clobbered-as-crude-plummets-virus-crisis-deepens-idUSKBN20W1IF

As the oil prices continue to decrease, combined with the spread of coronavirus (COVID19), and its impact on world economy, Wall Street suffered its biggest one day loss since the 2008 financial crisis. Energy stocks were hit hard as the oil price war escalated between Saudi Arabia and Russia.  Slowly, but surely, we see panic among investors and shareholders. Some analysts believe that signs of recession can be seen quite clearly, and therefore there will be a slowdown in economic activity. Do you believe that we are nearing towards recession?

Federal Reserve Cuts Rates by Half Percentage Point to Combat Virus Fear

The Fed has cut rates once again by a half percentage point due to recessionary pressures resulting from the coronavirus. The federal funds rate is now between 1%-1.25%, however, the stock markets fell anyway. While this shock is considered temporary, there is no way of telling how long this might last and how much output will decline. While an interest rate cut doesn't address the cause of the downturn, Jerome Powell said he hoped it would soften damage to spending and confidences, stem financial-market disruptions and speed a recovery once any epidemic is under control.

Do you believe this is the best method of action by the Fed to address a potential recession? If not, what could they do to make a bigger impact rather than just adjusting interest rates?

Economists Slash Global Growth Forecasts as Coronavirus Spreads

https://www.nytimes.com/2020/03/02/business/economy/global-economy-coronavirus.html

The Organization for Economic Cooperation and Development says that economic growth will be cut in half as the coronavirus spreads to the world outside of China. It is hard to tell because of our lack of information on the effect on the businesses in China. The predicted decrease in growth in the United States is 1.5%. Recessions are looming all over the world. It is suggested by the OECD for countries to invest in health care early and start preparing ahead of time. Some of these preparations include decreasing unnecessary travel, shorter workdays, delay tax days for small businesses, lowering interest rates, and stronger government policies.

What are some other preventative measures that can help our economy once the recession and coronavirus hits?

Goldman Sachs Warns of Recession Risks From Coronavirus

Financial analysts have predicted that the United States will avoid an outright recession, but the risks have clearly grown over the past few weeks. The outbreak is weighing down more meaningfully on economic data, and investors are expecting volatility to increase in the coming days.  Goldman Sachs has predicted that the U.S would only grow 0.9% in the first quarter, and not grow at all in the second quarter - the worst six month growth predictions since the Great Recession. Central banks are aggressively intervening in order to prevent negative fallout due to the virus. Anticipation grows to see the next direction of interest rates when the Fed meets next on March 18th. The U.S is no longer immune to the virus, nor to the effects of the global economy. There is a growing threat to investment, jobs, growth, and lives all over the world, and there is no clear distinction on how severe the impacts of this virus will be.

https://www.usnews.com/news/economy/articles/2020-03-02/goldman-sachs-warns-of-recession-risks-from-coronavirus

Are we near a recession?

If the coronavirus becomes pandemic, as it spreads exponentially, then a global recession is likely. While a great percentage of manufacturers live in China, and the Corona virus has been a huge blow to the Chinese economy, it is quite possible that the global economy will tank following the Chinese economy.

Chinese business travel and tourism is very low, and the amount of goods being shipped in and out of China has decreased substantially as fears of the spread of the virus rise. If China does not produce, then the consumers who rely on their products will suffer, along with the economies that they affect.

Do you believe that the Coronavirus will be influential enough to cause a global recession? Will we cure it in time?

World Economy is in Survival Mode

 The coronavirus has certainly been a huge focal point in economic news lately, and rightfully so. The early optimism for the economy in 2020 is now virtually wiped away as the pandemic has halted all economic momentum early on in the year. Experts believe that the global economy is completely in survival mode amidst this tremendous economic shock. Travel, trade and supply chains are taking the largest hits worldwide rather quickly. Just last week the U.S. stock markets had one of their worst days ever as now a major sell off is fully underway.

Knowing the financial markets are sensitive to swings like this, do you think this latest swing is out of line given basic economic theory, or is the coronavirus on a trajectory to make 2020 a terrible year for the global economy?

Trump Administration Sees No Threat to Economy From Monopolies

This article's talks about the Trump administration denying the fact that monopolies are going to hurt the U.S. economy. The democrats have proposed that big companies need to be split up to keep the economy growing and to keep competition alive. Main companies they talked about were communication and tech companies and they said that they think these type of monopolies are hurting competition and consumers. In the annual economic report of the President, Trump and his administration dismissed the research on how some companies are dominating the industry and said that the info is flawed and that the rise of large companies may not be bad for consumers. They also mention that it is important that antitrust enforcement and competition policy doesn't punish firms for their success.

https://www.nytimes.com/2020/02/20/business/trump-economy-monopoly.htmlDo you think that the Trump administration is right or wrong?

Coronavirus Impact

As we progress farther into the cycle of the Coronavirus it's important to look at facts to truly estimate how much we have/will be affected by this epidemic. Stock markets are feeling the impact and investors have their tails tucked in-between their legs, but just how far will this virus take the world economy? We see that stack markets worldwide have suffered and we also see that major conferences have been halted in the fear for the safety of corporate employees.

The question that stands at the end of all of this turmoil is how far will this go? How much will not only the US be affected, but the world economy as a whole? While Asia has taken the blunt end of the impact is it only a matter of time before the US is to come to the same fate or are we going to be able to stick it out until a solution is found? What do yo think? How do you think is everyone going to be affected and how long do you think it's going to take us to recover?
https://www.nytimes.com/2020/02/28/business/stock-market-today-coronavirus.html

The Fed Can't Stop Coronavirus From Slamming the Economy, but it Could Ease Pain.

The market has dropped by 300 basis points since the first coronavirus death. The fed is considering doing multiple stages of rate cuts. The hope is that rate cuts will ease the mind of investors and help to stimulate economic growth. The Fed can only help so much though, they wouldn't be able to prevent a supply shock, which is still a possibility.

https://www.marketwatch.com/story/the-fed-cant-stop-coronavirus-from-slamming-the-economy-but-it-could-ease-the-pain-2020-02-28

U.S. Incomes, Spending Rose in January Ahead of Coronavirus

Personally, I haven't noticed many changes in popular areas or people avoiding being in public spaces. In fact, I would agree with the article that spaces are actually getting more crowded. 

For instance, I traveled to Indiana this weekend and it was so hard to find a parking spot at the mall there and traffic was extremely backed up (on a Saturday!). 

People receiving tax refunds could be part of the reason but I really just don't think that the Corona Virus is as complex as the media is making it. 

In both Ohio and Indiana I observed a lack of urgency or concern. Kids are still running around in crowded public places like schools of fish. 

What have you observed in regard to changes in population in public areas? Do you think that people will start avoiding public spaces once they spend all of their tax refunds? 

Global Economy Headed for Worst Year Since Financial Crisis

Economists predict that certain factors such as the coronavirus will lead the global economy to have its lowest level of growth since the Great Recession. GDP growth is currently predicted to be around 2.8%, which would be the first year to come in under 3% since the financial crisis in 2009. GDP growth in China alone is expected to drop .7% due to the impacts of the virus such as decrease in trade and tourism. Other Asian countries are also expected to see a decline because of the dramatic drop in tourism that is currently being seen. Some of the key factors that are predicted to decrease GDP and growth besides the coronavirus include the U.S.-China trade war, political uncertainty, and weakness in Japan and certain South American countries. The upcoming U.S. presidential election also casts uncertainty for the end of 2020, as their trade war with China could greatly change under democratic leadership. Despite the hit to global economic growth, economist do not see a recession occurring as a result of this.

Do you agree with the prediction that a recession is unlikely in the upcoming future or do you believe that it is still possible due to the current and future struggles of the global economy?

https://www.cnbc.com/2020/02/27/worlds-economic-growth-could-be-worst-since-financial-crisis-bank-of-america-says.html

Coronavirus Fears Are Driving Interest Rates Down, a Bad Omen for the Economy

The emergence of the coronavirus has had a severe detrimental effect on the global and the American economy, and this has correspondingly led to a drop in global interest rates. The drop in global interest rates specifically “reflects expectations that the Federal Reserve and other central banks will cut interest rates or take other actions to try to contain the economic damage” of the coronavirus. As the article notes, continually decreasing the rate of interest also leaves the global and the American economy “vulnerable if things were to really take a turn for the worse,” and it will also limit the ability of the Federal Reserve to pursue effective monetary policy. Overall, economists and investors are expecting two to three more interest rates cuts, and this leaves little room for further economic stimulus.

https://www.nytimes.com/2020/02/28/upshot/coronavirus-interest-rates-economy.html

The World's Most Famous Economist Sets Out the Case for Socialism

Thomas Piketty, author of Capital in the 21st Century, has a new book coming out; Capital and Ideology. This work is largely a sequel to his last entry, but with a different twist; his earlier novel was focused more on the logic of the economic mode of capitalism that Karl Marx's Das Kapital focused on.

The newer entry is a sociological analysis of how the capitalists maintain power over the lower and middle classes. It is essentially a social study of the wealthy and their influence on the economy, and by extension, the world as a whole.

Why is this relevant? For one, Piketty has one of the economically-soundest arguments for socialism in the 21st Century; he has been commonly referred to as the "21st Century Marx". Therefore, his books are typically highly commended and criticized by those on the opposing ends of the economic ideological spectrum. His book overall is highly critical of exorbitant personal wealth (who does that sound like), but he uses historical data to back his claims, which is accurate and yet dated all at once.

 In a world where redistributive populism looks to take from the uber-wealthy and give to the less fortunate, a study focusing on the critical aspects of the wealthy and their power could certainly spark a debate in any country currently in the midst of an election year. Bernie Sanders. anyone?

https://www.economist.com/books-and-arts/2020/02/29/the-worlds-most-famous-economist-sets-out-the-case-for-socialism

Companies Gauge the Coronavirus Impact

The Coronavirus outbreak has negatively affected many companies in the US. Broken supply chains and disrupted manufacturing has decreased demand for all products. The S&P lost 11.5% of its value this week. The worst week since the 2008 financial crisis. Microsoft announced that the virus has hindered computer and tablet sales, cutting their future forecasts. Apple said their sales in China dropped due to closing of stores. MasterCard also cut their forecasts because people are taking less international trips due to the fear of the virus. Investors are also less reluctant to lend them money. Jerome Powell of the Federal Reserve stated they would cut interest rates to incentivize spending and investing. He issued a statement saying these cuts would "act as an appropriate support for the economy" and "as a way to stem panic." Do you believe another economic recession is imminent?

https://www.nytimes.com/2020/02/28/business/economy/companies-coronavirus-economy.html

U.S. markets drop into correction territory, extending brutal week of losses

Recently, the Dow Jones has been on a constant decline. This past Thursday, it decreased by 4.4%. It has not seen a decline like this since the financial crisis in 2008. The Standard & Poor's 500 and the Nasdaq also fell. The Dow Jones is down nearly 13% from its recent high. It has been decreasing for 10 days, and it has not decreased this quickly since 2011. This only adds to the fears investors are already having because of the coronavirus. This fall has erased one third of stocks' gains since Trump's 2016 election.

Investors fears are only increasing since the first US case of coronavirus that could not be linked to travel or contact has just recently occurred in California. With this, companies and musicians have began canceling conferences and concerts due to fear of the virus. These companies stocks are being affected by this. This Thursday, Tesla's stock price fell 13%. Some Wall Street veterans believe that the coronavirus was an external shock that scared investors.

The US will average 1.25% growth for the first half of the year. While this epidemic has negatively affected the US economy, Europe is in worse shape. Germany and Italy run close to being in a recession, and they do not have the tools to fix it because of there previous weak growth and financial crises.

How much longer do you believe the coronavirus will continue to affect the US economy? Since many different countries are being affected by the virus, what do you think this means for our future?

https://www.washingtonpost.com/business/2020/02/27/stock-market-dow-coronavirus/

Goldman sees zero earnings growth for US companies this year because of coronavirus

According to Goldman Sachs, the earnings growth for the companies in the US will stagnant in this year because of the coronavirus. Goldman' s chief US equity strategist David Kostin said that " US companies will generate no earnings growth in 2020." This rapid spreading of the virus had cause the historic decline in the Dow Jones in which they dropped more than 8% since Feb 24. The S&P 500 fell about 8.6% and Nasdaq fell about 2.9%. Investors are still optimistic that market will bring it back up after the virus. but Goldman didn't think so, because the virus's impact on the supply chain had caused most of the big companies like Apple or Nike. So, with this virus going around the world, and stock markets declining in the past week, is this the start of another recession? Should people be worried?

https://www.cnbc.com/2020/02/27/goldman-sees-zero-earnings-growth-for-us-companies-this-year-because-of-coronavirus.html

Brexit to Boost Public, Private UK Investments

After having left the European Union to end the month of January, it appears that new certainty in the future of Britain will help boost re-investing, per Bloomberg. With the leave officially completed and new agreements begin to be worked out, confidence in the British economy has boomed. Boris Johnson wishes to do the same as private corporations, and also invest more into the country, with money that may have been used to help support the EU in the past. With British companies soon to reinvest profits into growing both in the UK and the EU, this will only help further demonstrate the positive aspects of why the UK has decided to leave.

Do you believe that company and consumer confidence will be enough to maintain a positive post-Brexit UK, or will the full ramifications of Brexit hurt these investments in the long run without EU membership?

The Country is Desperate for More Immigrants Under the Trump Administration

This article depicts and goes over the main concerns economists have when it comes to the future economic growth. The issue being that the United States needs more immigrants. Over hundred's of years, the country was built by immigrants and growth has been great because of immigrants but the net flow of immigration in the U.S. has been slowing down since 2007 and continues to drop rapidly since the Trump administration. On the opposite side of that, the baby boomer population is slowly hitting the retirement age and are drifting out of the work force. The combination of this fact, mixed with the statistics of severe drops in birth rates since, has economists concerned about the slowing labor force which will lead to significant drops in economic growth, production, and productivity. The National Foundation of American Policy predicts a 30% drop in immigration by 2021 and as a result, a 35% drop in the average annual growth of the labor force in the U.S.

Previous annual immigration numbers were at 1 million a year, whereas now, they have been cut by half (500,000). If this continues, it is predicted that the national GDP (gross domestic product) will drop by 700 million by 2030. The number one argument against immigration is that domestic wages suffer because of immigrants taking jobs, but the evidence behind that is limited. This is seen to only happen with a small population of the labor force that ended up dropping out of high school. Even with this being an issue, economists have proposed a simple different design can solve the problem.  The United States has a high supply of high-skilled workers and because of that, there are less and less low-skilled workers to do the lower level jobs. Over the years, the people that have been doing these jobs have been poor immigrants that came to the U.S. in search of a better life. With the slow-down of immigration, these jobs will be in more and more demand, without the supporting labor force to take these jobs, there may be an economic crisis. The article argues that with a continued immigration constrain, and a lowering fertility rate, the economy will suffer in the long-run and the nation's debt burden will increase. 

Based on this, what do you think would be the best way to go about avoiding the consequences of cutting immigration?

https://www.nytimes.com/2020/02/27/business/economy/immigration-economy-mulvaney-trump.html