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Ask HN: How bad will the 2020 economic crisis be?

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Re: Ask HN: How bad will the 2020 economic crisis be?

#161

Post by sixQuarks »

alexpetralia wrote: post #77

Hopefully everyone will keep in mind that bailouts should go to the citizenry at large to resurrect demand, not to large multinationals which need to pay off debt they should have never incurred in the first place (and which was spent on high-risk growth projects or shareholder buybacks). "Take Boeing. The aerospace giant of course wants a $60 billion bailout. Financial problems for this corporation predated the cris…

They will pass whatever corporate bailouts they want, and they don’t even have to worry about mass protests like occupy Wall Street this time because of social distancing. Who knows where this is going... scary times

Re: Ask HN: How bad will the 2020 economic crisis be?

#162

Post by mrich »

thiago_fm wrote: post #159
mrich wrote: post #80

Some thoughts: - Short term we need government to step in and avoid a large-scale meltdown of businesses that would be more catastrophic than the virus itself. This will likely involve taking equity stakes in airlines etc. Warren Buffet might also be willing to help here again, he has 128 billion USD saved up for times like these :) - Stock market likely hasn't seen the bottom yet. There will be more deleveraging and…

That's a joke. Big airlines are terrible businesses, Warren Buffet would never invest on them like this, unless he has gone insane. Also, those billions is from Berkshire, they won't invest the money of their shareholders into bad businesses, I don't see that happening. Second thing is that you suppose that there will be forever lockdowns. We're only having it because the current health system isn't able to handle al…

Buffet's already done it for Delta beginning of March: https://www.foxbusiness.com/markets/buffett-coronavirus-batt...

I'm not assuming there will forever be lockdowns, quite the contrary, but for that there needs to be an effective system for responding to these kind of viruses so there doesn't have to be a full lockdown again. Basically you have to be able to quickly follow up on each case, and this will require things like determining where someone has been the past 10 days or so, and also regular controls (no more flying with any fever?)

Re: Ask HN: How bad will the 2020 economic crisis be?

#163

Post by justaguyhere »

sixQuarks wrote: post #161
alexpetralia wrote: post #77

Hopefully everyone will keep in mind that bailouts should go to the citizenry at large to resurrect demand, not to large multinationals which need to pay off debt they should have never incurred in the first place (and which was spent on high-risk growth projects or shareholder buybacks). "Take Boeing. The aerospace giant of course wants a $60 billion bailout. Financial problems for this corporation predated the cris…

They will pass whatever corporate bailouts they want, and they don’t even have to worry about mass protests like occupy Wall Street this time because of social distancing. Who knows where this is going... scary times

More than these bailouts, I am worried about rights being suspended. There is already talks about indefinite holding of people and such. And what if the election gets suspended/postponed?

Scary times indeed

Re: Ask HN: How bad will the 2020 economic crisis be?

#164

Post by michaelbrave »

everybodyknows wrote: post #117
jonahbenton wrote: post #65

Earlier quoted context omitted.

I am not an economist but by virtue of working in the fintech space for many years, particularly in credit, feel this specific point acutely- "economies and democracies cannot idle with incurring enormous financial costs" This is what worries me about this crisis more than the myriad other issues, like- -the end is unknown bc we dont have an antiviral treatment or vaccine, and we dont know how long immunity lasts -we…

A comparison I would look to here are historical economic recoveries, after near-complete destruction of physical capital, e.g. Germany and Japan in 1946.

weren't both of those heavily propped up by other countries in the aftermath?

Re: Ask HN: How bad will the 2020 economic crisis be?

#165

Post by mrguyorama »

guru4consulting wrote: post #134
alexpetralia wrote: post #77

Hopefully everyone will keep in mind that bailouts should go to the citizenry at large to resurrect demand, not to large multinationals which need to pay off debt they should have never incurred in the first place (and which was spent on high-risk growth projects or shareholder buybacks). "Take Boeing. The aerospace giant of course wants a $60 billion bailout. Financial problems for this corporation predated the cris…

someone should start an online petition that prevents any bailouts to Boeing. Is there any official government online portal similar to change.org? hopefully, the politicians may limit the bailout amount if lots of people raise their voice.

Obama had made an official system like change.org, but Trump killed it. He didn't pay any attention to it anyway, and it didn't really have an impact and was also being abused a bit

Re: Ask HN: How bad will the 2020 economic crisis be?

#166

Post by harambae »

danaris wrote: post #140
nopinsight wrote: post #81

Earlier quoted context omitted.

A key reason why this time might be different: A call for helicopter money even among some fiscal conservatives. Before this, such as in the 2008 crisis, much of the liquidity injection didn’t flow down the bottom part of economic hierarchy. Thus, they haven’t had much increased spending power. So, no inflation of common items. The prices of trophy and other assets preferred by the wealthy did rise up greatly in the…

...Can you clarify "helicopter money"? That's not a term I've heard before.

It's a term coined by Milton Friedman many years ago

https://en.wikipedia.org/wiki/Helicopter_money

Re: Ask HN: How bad will the 2020 economic crisis be?

#167

Post by harambae »

IanSanders wrote: post #150
bufferoverflow wrote: post #92

It's going to be bad for the following reasons: 1) Governments are not shutting everything down fast enough. Many countries are in the phase of "oh, we only have 200 cases, not a problem, look at Italy" . They are just a few weeks behind Italy. 2) Some people, especially young ones, are not following quarantines. All it takes is one super-spreader to start another wave of infection. 3) People will run out of money so…

> 1) I'm just a rando from the internet but my suspicion is that governments could be intentionally trying to slow the infection rate down rather than stop it completely. If you perform a perfect shutdown with 200 cases, lets say another 400 are identified since, all 600 recover/don't make it, but once you stop the quarantine everything will be back to square one - someone will spread it again eventually. On the othe…

>intentionally trying to slow the infection rate down rather than stop it completely

The individualistic attitudes in the US (and probably Europe, although I'm not an expert there) were never going to lead to the infection being stopped entirely. I can't imagine anyone was actually worried about being too effective in containment.

Re: Ask HN: How bad will the 2020 economic crisis be?

#168

Post by zzzzzzzza »

axegon_ wrote: post #76
jawns wrote: post #15

I've heard economic forecasters predict that the economy will spring back once the crisis is over. Their reasoning is that the crisis is an external issue, not a problem with the economy itself, as with the housing crisis. Once it becomes more contained and controlled, there will be work for people to do, and people available to do that work, and the economy will just start humming along again. I'm more pessimistic.…

> I've heard economic forecasters predict that the economy will spring back once the crisis is over. Their reasoning is that the crisis is an external issue, not a problem with the economy itself, as with the housing crisis. Once it becomes more contained and controlled, there will be work for people to do, and people available to do that work, and the economy will just start humming along again. Though I'm by no mea…

building anything takes years. this may plant some seeds but they will take a long time to mature.

Re: Ask HN: How bad will the 2020 economic crisis be?

#169

Post by axegon_ »

zzzzzzzza wrote: post #168
axegon_ wrote: post #76

Earlier quoted context omitted.

> I've heard economic forecasters predict that the economy will spring back once the crisis is over. Their reasoning is that the crisis is an external issue, not a problem with the economy itself, as with the housing crisis. Once it becomes more contained and controlled, there will be work for people to do, and people available to do that work, and the economy will just start humming along again. Though I'm by no mea…

building anything takes years. this may plant some seeds but they will take a long time to mature.

Not necessarily. https://twitter.com/fchollet/status/1242293578967085057

Re: Ask HN: How bad will the 2020 economic crisis be?

#170

Post by IanSanders »

harambae wrote: post #167
IanSanders wrote: post #150

Earlier quoted context omitted.

> 1) I'm just a rando from the internet but my suspicion is that governments could be intentionally trying to slow the infection rate down rather than stop it completely. If you perform a perfect shutdown with 200 cases, lets say another 400 are identified since, all 600 recover/don't make it, but once you stop the quarantine everything will be back to square one - someone will spread it again eventually. On the othe…

>intentionally trying to slow the infection rate down rather than stop it completely The individualistic attitudes in the US (and probably Europe, although I'm not an expert there) were never going to lead to the infection being stopped entirely. I can't imagine anyone was actually worried about being too effective in containment.

>I can't imagine anyone was actually worried about being too effective in containment.

It could have been when we had just a few cases, but you're right.

The more effective the quarantine is, the longer it will take, creating more stress on the economy.

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