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The country will rebound, as things reopen. The bounce will seem remarkable, given how big the drop was: Retail sales rose 18 percent in May, and the economy added 2.5 million jobs. But absent dramatic policy action, a pandemic depression is possible

“…households are headed for a cliff. But not everyone will be affected by it equally. Rich workers, the ones with do-anywhere office jobs, have remained relatively untouched by job and earnings losses thus far. Wealthy families have seen their stock portfolios rebound to close to where they were in the winter. But poor workers—disproportionately black and Latino workers, as well as younger workers—have borne the heaviest employment and earnings losses. They entered this recession with no wealth cushion, many saddled with heavy rents and heavy debts. Income and job losses for them translate into a loss of demand economy-wide, absent federal intervention.

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“If and when that federal intervention dries up, millions of families just keeping their head above water will sink, as lost jobs and canceled hours force them to stop paying their rent and go into arrears on their debt payments. Hunger, homelessness, forgotten plans to attend community college, babies growing up in stressed households: These are the stakes.

“This steep decline in consumer spending will hasten mass business failure, the second factor weighing on the economy… On top of that, numerous businesses—airlines, restaurants, live-events businesses, hotels, private schools, oil and gas companies—face severe and stubborn slumps…

“A third factor behind a possible second Great Depression is the budget crisis facing states and cities.”

https://www.theatlantic.com/ideas/archive/2020/06/second-great-depression/613360/


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“Statewide eviction protections in places such as Arizona and California expire at the end of July; in Florida, Virginia, Connecticut, and elsewhere, state-level eviction protections expire on or before July 1.

“The end of such orders are premature, to say the least: According to one estimate, nearly a third of Americans missed rent in June…”

https://newrepublic.com/article/158257/summer-financial-ruin


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“During the worst economic collapse in generations, U.S. households actually managed to put aside more money. It may not be enough to get them through the aftermath…

“the fiscal lifeline is a temporary one. When it’s withdrawn -– and Congress is already discussing the timetable –- fragile household finances may come under growing strain.”

https://www.bloomberg.com/news/articles/2020-06-23/americans-will-soon-need-the-extra-money-they-saved-in-lockdown?srnd=economics-vp


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The coronavirus recession is pushing many companies into bankruptcy, a painful process that has led to layoffs, wiped out some investors and hurt the economy. But the chief executives of some of these businesses are doing just fine.

“Companies that are struggling to pay creditors and suppliers are managing to find millions of dollars to pay bonuses to their bosses. The payments, which are made just before a bankruptcy filing, appear to be legal and have been made by several companies.”

https://www.nytimes.com/2020/06/23/business/ceo-bonsues-before-bankruptcy-coronavirus.html


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It’s a tough time to be a mayor in America. Tax revenues have fallen off a cliff. Public sector layoffs have begun – a staggering 1.5 million jobs lost already – and there is no end in sight. The Upjohn Institute estimates that by the end of 2021, state and local governments will face a $1 trillion shortfall.

“To make matters worse, it is unclear if the federal government will do enough, or anything at all, to aid state or local governments.”

https://www.citymetric.com/politics/coronavirus-economy-city-budget-control-boards-5193


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Canada is enduring an economic crisis on the same grim scale [as the Great Depression], with more than three million out of work and the unemployment rate at 13.7 per cent.

“In February, prior to the crisis, more than 83 per cent of prime working-age Canadians were employed. Since then that figure has plunged to 73.7 per cent.”

https://www.macleans.ca/economy/canada-needs-a-plan-to-rebuild-itself-let-the-transformation-begin/


More than eight out of 10 English councils providing adult social care services are at technical risk of bankruptcy – or face a fresh round of cuts to services – because they cannot meet the extra financial pressures caused by the coronavirus pandemic, according to new research.”

https://www.theguardian.com/society/2020/jun/23/at-least-8-in-10-english-councils-need-help-to-avoid-going-bankrupt


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The West Midlands has become the first UK region to ask the government for billions of pounds in cash, to help stave off the worst of an “unprecedented” downturn.

“The region’s Conservative Mayor Andy Street unveiled the three-year plans today, calling for “immediate actions” to help stimulate the economy, and get back on the road to business recovery.”

https://www.itv.com/news/central/2020-06-23/billions-of-government-cash-needed-to-save-economy-andy-street-west-midlands-furlough/


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Due to the major economic crisis stemming from COVID-19, the European car market will narrow [odd choice of word] 25% in 2020, the European Automobile Manufacturers’ Association (ACEA) said on Tuesday.

“Car sales in the 27-member bloc is expected to drop by 3 million units, from 12.8 million in 2019 to 9.6 million in 2020, it stressed.”

https://www.aa.com.tr/en/economy/eu-car-sales-to-drop-25-in-2020-due-to-virus-report/1886866


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“…this vital source of income [remittances] for Latin America is… being battered by the coronavirus.

“Unlike previous crises, where remittances have increased during times of trouble, this time, they’re expected to drop by 20 per cent, equivalent to about US$110 billion, according to a World Bank report released in April.”

https://www.equaltimes.org/in-the-fallout-from-covid-19-latin


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Argentina was facing a third year of recession in 2020 even before the coronavirus hit. Now with the pandemic’s economic shock, some analysts foresee a record contraction in the crisis-prone country

“”This is going to be the worst, this year is completely lost,” said Gerardo della Paolera, an Argentine economic historian.”

https://www.aljazeera.com/ajimpact/argentina-economic-crisis-poised-bad-worse-200623203522114.html


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Battling against the effects of drought, devastating cyclone Idai and now the COVID-19 or coronavirus pandemic, starvation looms large over a large population in landlocked African country Zimbabwe.

“Just 40 kilometers from capital Harare, in Pararehwa village in Gormozonzi province, two boys had reportedly not eaten food for over four days.”

https://www.aa.com.tr/en/africa/zimbabwe-economic-crunch-leading-to-starvation/1887818


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Pakistan has a rough estimate of 1.2 million children on the street, a figure which is at least more than 10 years old. And since there has not been any recent census, in all probability their numbers may have increased…

“Markets have been closed down and then opened and then partially closed down. In such a situation street children and child beggars stand no chance of getting any help.”

https://www.dawn.com/news/1564757


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[Thailand’s] Police are on high alert after a cache of weapons and ammunition found on Tuesday in Tak’s Mae Sot district were suspected of being part of a plot to stir up political unrest.

“Citing intelligence information, national police chief Chakthip Chaijinda said it was likely the firearms were intended for use in a fresh round of political chaos…”

https://www.bangkokpost.com/thailand/general/1939828/weapons-find-sparks-new-unrest-fears


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Emerging-market inflation is dormant even as governments and policy makers hurl money into the economy. Investors shouldn’t count on it staying that way.

“Once the coronavirus pandemic is over, governments are going to struggle to wean themselves off the loose fiscal and monetary policies that have averted economic collapse.”

https://www.bloomberg.com/news/articles/2020-06-23/emerging-markets-risk-stimulus-addiction-and-revived-inflation


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As strict coronavirus lockdowns end, some central bankers have started hinting at another kind of exit — from emergency stimulus they launched just three months ago.

“Markets so far appear to be calling their bluff.”

https://uk.reuters.com/article/us-health-coronavirus-stimulus-analysis/central-banks-hint-at-pandemic-stimulus-exit-markets-arent-buying-it-idUKKBN23U219


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The global economy is limping back to life from the Covid-related disruption, but the recovery will be long and bumpy, according to Moody’s Investors Service.

““Global economic recovery will likely be prolonged. Q2 (April-June) 2020 will go down in history as the worst quarter for the global economy since at least World War II.”

https://www.hellenicshippingnews.com/global-economy-faces-long-bumpy-recovery-post-covid-moodys/


Global trade is expected to drop around 18.5% year-on-year in the second quarter of this year in a huge coronavirus-driven plunge which nonetheless could have been much worse, the World Trade Organization said Tuesday.”

https://www.bangkokpost.com/business/1939756/global-trade-set-to-shrink-18-5-in-q2-wto


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“…deflation tanked the economy in the Great Depression, and it has not worked out that great for Japan in recent times either. Deflation shrinks an economy, slashes business profits, and hurts farmers because crop and dairy prices fall, ranchers because meat prices decrease, drillers because oil prices sag, and jobs because employers pull back.

“What is indisputable is that prices have been falling at a dangerous pace… Commodity prices, which we have argued are the best daily indicators of monetary conditions, are signaling a convulsive downward price spiral.”

https://thehill.com/opinion/finance/504079-time-to-act-now-before-deflation-destroys-the-economic-recovery


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