Effect of economic crisis on America’s small businesses [slides]
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Re: Effect of economic crisis on America’s small businesses [slides]
#2One thing that really horrified me was how quickly people threw away the economy.
Unfortunately, this virus is highly contagious (to the point that the vast majority of countries won’t contain it) and fairly lethal. We don’t actually know how lethal, but it appears 1%-3%, but without widespread testing we wouldn’t know.
At the moment, we just reduced our GDP by 30%-50% in regions under quarantine. Think about that for a second...
Now consider the fact that the supply chain is also all kinds of messed up and with the loss of jobs people have less money.
Finally, save this, but I don’t think the US quarantine is going to do much to lower the curve. Simply put, the west is not prepared. Our checkouts are run by people without masks or gloves. People still are closer than 2 meters (or 6 feet).
To lower the curve we’d need strict quarantine (no leaving the house) for a month or two. Even then we won’t have enough masks, hopefully we’d have enough ventilators and tests by then...
Point is, we are tanking our economy and mark my words — it won’t work. People voted, had spring break, celebrated st. Patrick’s day went out shopping in droves. It’s likely too late, one sick per household and they infect the whole house.
All this to say: we are losing our economy and probably this isn’t effective.
Re: Effect of economic crisis on America’s small businesses [slides]
#3The slides by themselves do not speak a compelling narrative to me, so I think I’m missing something fundamental or not understanding.
Small businesses (all, businesses) will suffer quite badly, but if your company cannot continue operating because its shut/slowed down for 2 weeks then it’s likely that your business was running on a knifes edge and /any/ shock would have killed it.
Arguing that many people have done this is not just cause to bail them out (speaking from a purely logical non-empathetic position)
EDIT: ok. Our entire economy is built with no buffers in place and people here seem to have no issue with that. From a personal finance perspective I ensure that I live beneath my means and have capacity for a couple of months lost revenue. (Shit happens) and I’m not “well paid”.
Re: Effect of economic crisis on America’s small businesses [slides]
#4Instead of hundreds of billions in loans to businesses, which have to be underwritten -- and as discussed on Slides 17/18, the SBA did an abysmal job administrating during Hurricane Sandy, helicopter money might be the better answer.
Give everyone money, no criteria. If we do impose income limits, and since viable proposals do -- we ought to discuss it. Give them a check now anyways. We cannot be worried people will be "annoyed" if they owe their check back come next tax season. Future annoyance is a small price to pay if these businesses can't stay afloat. We will be feeling the effects for far longer than a quarter. The helicopter money needs to be distributed as soon as possible.
Re: Effect of economic crisis on America’s small businesses [slides]
#5One thing that really horrified me was how quickly people threw away the economy. Unfortunately, this virus is highly contagious (to the point that the vast majority of countries won’t contain it) and fairly lethal. We don’t actually know how lethal, but it appears 1%-3%, but without widespread testing we wouldn’t know. At the moment, we just reduced our GDP by 30%-50% in regions under quarantine. Think about that fo…
“one sick per household and they infect the whole house“
This happened repeatedly in China; in fact, the nature of a lockdown sort of encourages this. But an infected household of 5 ppl is significantly easier to contain than 1 infected person going on to infect 4 people from 4 different walks of life.
Re: Effect of economic crisis on America’s small businesses [slides]
#6One thing that really horrified me was how quickly people threw away the economy. Unfortunately, this virus is highly contagious (to the point that the vast majority of countries won’t contain it) and fairly lethal. We don’t actually know how lethal, but it appears 1%-3%, but without widespread testing we wouldn’t know. At the moment, we just reduced our GDP by 30%-50% in regions under quarantine. Think about that fo…
New Yorker here. From what I see through my window, my fellow New Yorkers still don’t “get it”. I see clusters of people hanging out and families going for leisurely walks. If this keeps up the number of infections - and deaths - will only increase.
Last week my brother suggested instead of working from home I work from a Starbucks.
I feel like people don’t understand how serious this is and it’s really bothering me.
Re: Effect of economic crisis on America’s small businesses [slides]
#7The stock market is largely collapsing because:
1.) Hedge funds levered up their capital 5 - 15x to make more money, then got caught with their pants down. So they all panic sold at once, crashing the market.
2.) CEOs of large corporations used cash to buy back their stock, inflating the stock price, and depleting their cash reserves. So now those same companies are on the brink of collapse, causing the credit markets to collapse, the stock market to collapse, and the rest with it. They can buy 50B worth of their own stock, but cant pay employees for a month without revenue.
This whole mess is in part due to financial engineering taken down by a black swan event. CEOs should be in jail and so should finance professionals. Laws need to be passed so that finance individuals cannot ruin the market for their own financial gain.
Re: Effect of economic crisis on America’s small businesses [slides]
#8One thing that really horrified me was how quickly people threw away the economy. Unfortunately, this virus is highly contagious (to the point that the vast majority of countries won’t contain it) and fairly lethal. We don’t actually know how lethal, but it appears 1%-3%, but without widespread testing we wouldn’t know. At the moment, we just reduced our GDP by 30%-50% in regions under quarantine. Think about that fo…
Well, only one way to find out, right?
Re: Effect of economic crisis on America’s small businesses [slides]
#9One thing that really horrified me was how quickly people threw away the economy. Unfortunately, this virus is highly contagious (to the point that the vast majority of countries won’t contain it) and fairly lethal. We don’t actually know how lethal, but it appears 1%-3%, but without widespread testing we wouldn’t know. At the moment, we just reduced our GDP by 30%-50% in regions under quarantine. Think about that fo…
Reasonable compliance with social distancing from 25% of the population has a huge impact on the slope of the curve.
Of course better compliance from larger numbers of people has even more impact, but it's not a binary condition.
That said, we probably aren't doing enough to prevent hospitals from being overwhelmed, or to even push that very far into the future.
Re: Effect of economic crisis on America’s small businesses [slides]
#10It is time to declare war. We need to move to a war economy and get on with what needs to be done.