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The world woke up Monday to the reality that the coronavirus epidemic is going to have a much bigger impact on the global economy than investors and policy makers had assumed. Just how big, no one really knows

“The potential for disaster is sobering. The economies of the world are extraordinarily resilient, yet extraordinarily dependent upon each other in a crisis. Sadly, the things we need most to get us through this — wise leadership, global cooperation and clear thinking — are harder to find than a surgical mask.”

https://www.marketwatch.com/story/if-the-coronavirus-isnt-contained-a-severe-global-recession-is-almost-certain-2020-02-24


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Italy’s economy, which was already contracting at the end of last year, looks sure to be thrown into yet another recession by a sudden outbreak of coronavirus that has rocked the country…

“Lombardy, around the financial capital Milan, and Veneto account for around a third of Italian GDP and half its exports.”

https://uk.reuters.com/article/uk-china-health-italy-economy/coronavirus-set-to-deal-heavy-blow-to-italys-ailing-economy-idUKKCN20I1TC


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Investors holding Lebanese bonds are expecting the worst, as years of financial mismanagement may well push the country to default on its debt for the first time in its history

“Lebanon was hit with a double downgrade over the weekend by two of the world’s largest ratings agencies, dragging its sovereign credit rating further into junk territory…”

https://www.cnbc.com/2020/02/24/lebanon-crisis-debt-default-is-virtually-certain-after-credit-downgrades.html


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Malaysia’s prime minister Mahathir Mohammad’s surprise resignation means politics looks set to be an added headwind for the economy already reeling under the impact of the coronavirus outbreak.

“The crisis throws the imminent fiscal stimulus package into disarray…”

https://think.ing.com/articles/malaysias-leadership-crisis-comes-at-worst-time-for-the-economy/


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The emergence of hundreds of coronavirus cases in two major economies outside China has dashed hopes of a speedy recovery from an epidemic that has already wreaked havoc on global supply chains and hit company profits.

“The number of infections in South Korea, a major producer of cars, electronics and machinery, has shot up to more than 830.”

https://edition.cnn.com/2020/02/24/business/coronavirus-global-economy/index.html


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“…[the global economy had no margin] for an accident at the beginning of this year. Yet there has been a big accident: China’s COVID-19 shock.

“Over the past month, the combination of an unprecedented quarantine on Hubei Province (population 58.5 million) and draconian restrictions on intercity (and international) travel has brought the Chinese economy to a virtual standstill.”

https://www.marketwatch.com/story/coronavirus-the-global-economy-is-much-more-vulnerable-now-than-during-the-sars-epidemic-2020-02-24


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For some years now, many analysts have believed that the next major global crisis would start in China, because it was suspected to be hugely overleveraged; equally, if not more important, nobody knew what was really going on. However, with central banks keeping the money feed so easy, markets all over the world kept rising.

“Judging from the way equity markets are behaving today, could that time have come?”

https://www.financialexpress.com/opinion/2008-once-more-the-world-may-be-headed-for-another-global-economic-crisis/1877962/


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Fear has returned to Wall Street. The spread of coronavirus cases in Italy, Iran and South Korea is shaking investors out of their recent complacency.

“Investors are nervous that the global economy will slow dramatically in the first quarter because of coronavirus. And they are piling into classic safe haven fear trades as a result and shunning anything that seems risky.”

https://edition.cnn.com/2020/02/24/investing/bond-yields-gold-fear/index.html


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More than $1 trillion was wiped off global stock markets on Monday as panicked investors bet that the coronavirus outbreak will cause a devastating economic slowdown.”

https://www.telegraph.co.uk/business/2020/02/24/1-trillion-wiped-global-markets-coronavirus-panic-sends-stocks/


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