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““As the economic carnage from the coronavirus pandemic continues, a long-forbidden word is starting to creep onto people’s lips: “depression”

The economic damage from the coronavirus… threatens to dwarf the 2008 downturn.”

https://www.straitstimes.com/business/invest/the-d-word-looking-more-inevitable


[Here] are five key measures and accompanying charts showing that the coronavirus-induced US economic downturn is worse than the one that accompanied the Great Recession.”

https://www.businessinsider.com/5-charts-how-coronavirus-economic-fallout-compares-to-great-recession-2020-5?r=US&IR=T#the-last-nine-weeks-have-seen-an-unprecedented-number-of-americans-filing-for-unemployment-benefits-1


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Car rental firm Hertz has filed for bankruptcy protection in the US after the coronavirus pandemic caused demand to collapse.

“The firm, whose largest shareholder is billionaire investor Carl Icahn, said the “sudden and dramatic” impact of coronavirus on travel demand had caused a “abrupt decline” in revenue and future bookings.”

https://www.cityam.com/car-rental-firm-hertz-files-for-us-bankruptcy-protection/


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Jaguar Land Rover is reportedly seeking state support as car sales have collapsed under the lockdown.

“The high-end car maker could need more than £1bn of aid, Sky News reported, to help it bridge the slump in sales.”

https://www.telegraph.co.uk/business/2020/05/24/jaguar-land-rover-rescue-talks-sales-collapse/


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Aston Martin is sacking its chief executive, Andy Palmer, following a 98% collapse in the luxury car company’s share price since it floated on the stock market less than two years ago

“…the company reported that losses had ballooned to £119m in the first three months of the year as the coronavirus pandemic caused the already struggling British car maker’s sales to plunge across the world.”

https://www.theguardian.com/business/2020/may/24/aston-martin-sacks-chief-andy-palmer-after-shares-plunge


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British finance minister Rishi Sunak has authorised a bailout plan to rescue companies that are seen as strategically important, with the Treasury saying it may step in to support crucial businesses on a “last resort” basis after other options run out.”

https://www.aljazeera.com/ajimpact/bailout-britain-rescue-plan-strategically-important-firms-200525025146076.html


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The UK is facing a “tsunami of job losses” when the Government’s huge support for workers’ wages is wound down, the boss of Britain’s biggest recruiter has warned.

“Some 856,500 people made new benefit claims in April, six times higher than any point in the financial crisis, while eight million are furloughed.”

https://www.telegraph.co.uk/business/2020/05/24/boss-britains-biggest-recruiter-warns-tsunami-job-losses-furlough/


Rising unemployment is toxic for the property market and low interest rates may not be enough.”

https://www.theguardian.com/business/2020/may/24/most-ingredients-are-in-place-for-a-property-crash-later-this-year


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Prime Minister Boris Johnson is coming under increasing pressure to extend the deadline for the implementation of the Brexit withdrawal agreement to avoid a hard border in the Irish Sea.

“An influential UK think tank said businesses are focused more on “staying afloat” rather than understanding new trade agreements.”

https://www.belfasttelegraph.co.uk/business/northern-ireland/fresh-calls-for-brexit-deadline-extension-to-avoid-hard-irish-sea-border-39230522.html


A slump in capital investments, private consumption and exports pushed the German economy into a recession in the first quarter, detailed data showed on Monday, giving a glimpse of the damage caused by the coronavirus pandemic.”

https://www.reuters.com/article/us-germany-economy-gdp/slump-in-consumption-exports-push-germany-into-recession-in-first-quarter-idUSKBN2310KI


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The reopening of Italy’s restaurants, cafes and stores earlier this week brought hopes of a return to normality for many Italians after a punishing two-month coronavirus lockdown.

“But the picture is not so bright.”

https://www.thejakartapost.com/life/2020/05/24/italys-restaurants-shops-caught-between-rock-and-hard-place.html


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“The U.S. and global economies are in a perilous state, and yet we may be underestimating the dangers. Just out of sight lies a second large threat: a global debt crisis that, centered in Europe, would further destabilize a world already struggling to combat the dreadful consequences of the coronavirus pandemic.

If some sort of financial rescue isn’t organized, Italy might be forced out of the euro, dragging along some other highly indebted countries.”

https://www.washingtonpost.com/opinions/why-italys-debt-matters-for-everybody/2020/05/24/12b2f310-9baf-11ea-ac72-3841fcc9b35f_story.html


Europe’s leaders may be united on the need to throw money at economies during the coronavirus crisis, but they have yet to confront how to pay for it all.”

https://www.aljazeera.com/ajimpact/bailouts-debt-european-leaders-difficult-decisions-200525031258228.html


Some European economies have now adopted negative interest rates for the longest period in history. The controversial policy has turned banks’ business models upside down, leaving economists unsure of their next move.”

https://www.europeanceo.com/finance/as-negative-interest-rates-persist-banks-are-stepping-into-the-unknown/


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…it is nearly impossible to argue convincingly that a banking crisis will not emerge very soon, perhaps in as little as a month or two [in the EU or UK].

“A banking and systemic crisis will raise the costs for central banks and their governments considerably, not just because they will have to fund bailouts, but they will also have to cover the associated fallout, such as the inevitable evaporation of interbank credit in the financial sector and of bank credit from non-financial borrowers.”

https://seekingalpha.com/article/4349773-path-to-monetary-collapse


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Hong Kong police fired tear gas and water cannon to disperse thousands of people who rallied on Sunday to protest against Beijing’s plan to impose national security laws on the city.

“In a return of the unrest that roiled Hong Kong last year, crowds thronged the Causeway Bay shopping area in defiance of curbs imposed to contain the coronavirus.”

https://business.financialpost.com/pmn/business-pmn/thousands-protest-chinese-security-law-as-unrest-returns-to-hong-kong


China’s central bank on Monday lowered its official yuan midpoint to the weakest since the 2008 global financial crisis, reflecting losses in the spot yuan on Friday after Beijing proposed a new national security law for Hong Kong.”

https://www.reuters.com/article/china-yuan/china-lowers-yuan-midpoint-to-weakest-since-2008-global-financial-crisis-idUSAZN0FOZ00


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China’s army of 290 million migrant workers has been particularly hard hit by the pandemic, but most are unable to access unemployment support.

“Covid-19 is having a deeper impact on employment in China than the severe acute respiratory syndrome (Sars) outbreak and the global financial crisis.”

https://www.scmp.com/economy/china-economy/article/3085904/coronavirus-has-hit-chinas-migrant-workers-harder-sars-and


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The national lockdown, which completes 68 days at the end of its fourth phase on May 31, has pushed India’s migrant worker population into a vortex of uncertainty and despair.

“Jobless and penniless, thousands of them continue to fight the unprecedented situation, hoping to make it to the other side of the crisis. Many, though, are losing the battle for survival.”

https://www.indiatoday.in/india-today-insight/story/migrant-deaths-trigger-hunger-alarm-1681461-2020-05-24


Just as early bets on an emerging-market recovery start fuelling appetite for stocks and currencies, an old bugbear is reappearing to haunt investors: US-China tensions.”

https://www.bangkokpost.com/business/1923488/emerging-markets-stumble-as-us-china-tensions-return


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Japan’s economy is set for a deepening recession under the weight of the Covid-19 pandemic.

“After the annualised 3.4% GDP contraction in the last quarter, the April-June period is forecast to experience a 20%-plus decline — the worst in postwar history…”

https://www.businesslive.co.za/bd/opinion/2020-05-24-the-japan-times-recession-looms-over-japan/


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Australia’s economy could collapse and ‘go off a cliff’ if government fiscal support programs are withdrawn in four months time, an economist has warned.

“The federal government’s JobKeeper and JobSeeker payments for businesses and workers impacted by the coronavirus crisis are set to expire in September- the same time banks plan to lift loan deferrals.”

https://www.dailymail.co.uk/news/article-8353317/Grim-warning-Australian-economy-cliff-government-support-programs-end.html


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““Deflationary Spiral

Such is the biggest problem for the Fed and one that monetary policy cannot fix. Deflationary “psychology” is a very hard cycle to break, and one the Fed has been clearly fearful of over the last decade.”

https://econintersect.com/pages/analysis/analysis.php?post=202005230402


“…increasing unemployment negates headline inflationary pressures. US unemployment has hit a postwar high of 14.7 percent, and will almost certainly increase.

“With less people spending, prices tend to fall. The savings rate has also increased from 8 percent in February to 13.1 percent in March, the highest since November 1981. If this trend persists, so too will the deflationary spiral.”

https://globalriskinsights.com/2020/05/us-inflationary-pressures-are-highly-unlikely/


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As sections of the global economy tip-toe toward reopening, it’s becoming clearer that a full recovery from the worst slump since the 1930s will be impossible until a vaccine or treatment is found for the deadly coronavirus.

Consumers will stay on edge and companies will be held back as temperature checks and distancing rules are set to remain in workplaces, restaurants, schools, airports, sports stadiums and more…”

https://uk.finance.yahoo.com/news/fate-global-economy-rests-more-160000295.html


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“Politicians have become more cautious about immunisation prospects. They are right to be…

So, is the virus here to stay? The simple answer is: yes.”

https://www.theguardian.com/world/2020/may/22/why-we-might-not-get-a-coronavirus-vaccine?utm_term=RWRpdG9yaWFsX0d1YXJkaWFuVG9kYXlVS19XZWVrZW5kLTIwMDUyMw%3D%3D&utm_source=esp&utm_medium=Email&CMP=GTUK_email&utm_campaign=GuardianTodayUK&fbclid=IwAR1yJAqEmbpQ1zFk3xAszWnrgDUZWDXEXR2qYPppwvJK_EFbAV-2iI43y6w


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