We entered this pandemic in a position of weakness with 0% growth in Q4 of 2019. To add to our woes, Brexit is still unresolved.
“UK economic output shrank by 20.4% in the second quarter of 2020, the worst quarterly slump on record, pushing the country into the deepest recession of any major global economy.
“This crash in GDP in the April-June period is the worst since quarterly records began in 1955 and follows a 2.2% contraction in the first quarter. Industries most exposed to government lockdown measures to contain the coronavirus pandemic — services, production and construction — saw record drops.
“”Today’s figures confirm that hard times are here,” UK finance minister Rishi Sunak said in a statement. “Hundreds of thousands of people have already lost their jobs, and sadly in the coming months many more will.”
https://edition.cnn.com/2020/08/12/economy/uk-economy-gdp/index.html
“…we have not yet seen the full economic damage of the lockdowns. Even if Europe’s economies quickly restore their full pre-pandemic activities, the losses run up during the downturn will leave scars…
“…the collapse may have irretrievably damaged the balance sheets of many private companies.”
https://www.ft.com/content/8a73f56b-fe55-447d-ad88-3d2ee85da88f
“President Trump’s executive order to boost weekly aid for unemployed Americans is meant to alleviate “acute financial distress” for families across the country.
“However, restrictions on that extra assistance — a $400-a-week increase in benefits — means it likely won’t be available to a big chunk of unemployed US workers.”
“Another North Texas Food Bank food distribution at Fair Park drew a big crowd… As the cars formed a mile-long queue through the parking lots, each told a story of a family in crisis…
““If it wasn’t for this, we’d probably go hungry,” shared Richard Archer.”
https://dfw.cbslocal.com/2020/08/11/car-line-stretches-mile-fair-park-food-giveaway/
“Like millions of other people in Florida and across the country, Tucker is a victim of an unemployment system unable to cope with the record number of claims that have swept the country during the coronavirus pandemic.
“In Florida the situation is particularly catastrophic.”
https://www.theguardian.com/world/2020/aug/11/florida-unemployment-coronavirus-benefits-system
“The United States’ fumbling response to the pandemic and its dithering over a new aid package is casting doubt on its economic prospects and making it one of the chief risks to a global rebound.
“After springtime restrictions, many U.S. states prematurely declared victory over the virus and began to reopen their economies…
“Confirmed infections are rising in most states, and many businesses have had to scale back or even cancel plans to reopen.”
https://abcnews.go.com/US/wireStory/virus-surge-makes-us-weak-link-global-economic-72300871
“While many today are focused on WeChat and TikTok, and others are fretting over the US elections and the unrelenting tit-for-tat provocations, the longer view is even more disturbing…
“…we’re long past debating whether a cold war with China is coming. It’s here, and by some accounts Washington is preparing for a hot war.”
“As a US ally and part of a loose coalition of Western economies, Australia, so dependent on China as a customer for our resources and a producer of manufactured goods, has more at stake than most in the impacts of the pandemic and the geopolitical tensions on global trade flows and the shift in focus from the efficiency of “just in time” sourcing to supply chain resilience and national security.”
“Kuwait is preparing to force as many as 360,000 foreign workers to leave the country, according to local press reports, in the latest sign of how the Gulf expatriate labor force is bearing the brunt of an economic slowdown caused by low oil prices and the coronavirus crisis…
“…the Gulf has suffered badly from the coronavirus pandemic, with businesses pulling down the shutters and sending their staff home.”
https://www.forbes.com/sites/dominicdudley/2020/08/11/kuwait-deport-gulf-expat-exodus/#188fcb66542f
“Turkey has also spent well more than it should, but it has done so in way that hid the costs deep in its financial system, leaving them invisible to all but the most committed financial sleuths.
“There’s relatively little sovereign debt—the type usually funded by international bonds—to be found, though its overall value is ticking up somewhat. The big borrowing has been by the country’s banks, including both private and state-owned banks—and that is where Turkey’s trouble has built up.”
https://foreignpolicy.com/2020/08/11/erdogan-economic-disaster-turkey-banks-debt-dollars/
“Through past political instability, Lebanese always somehow kept their way of life unshaken. This time, it seems to have been wiped away. Over the last 10 months, Lebanese have had to deal with a dizzying series of events that have upended an artificial sense of security…
“After forging ahead through Lebanon’s crises, the 29-year-old Boumelhem feels her resolve might finally be broken.”
https://www.japantimes.co.jp/news/2020/08/12/world/myriad-crises-lebanese-broken/#.XzOhWShKjIU
“Venezuelans are steadily losing access to cheap basic services from water to cooking gas that have helped them survive economic crisis, forcing many to find creative solutions… from wood-burning stoves and long walks to find cellular coverage to improvised pipes for siphoning water off a mountain.
“Others simply do without.”
“Angry residents in Peru’s Andean and Amazon regions have attacked three mining and oil sector firms in the last week, two of which were forced to halt operations after deadly clashes, as a second wave of COVID-19 infections hits the country.
“The main reason: demand for economic aid and healthcare support during the pandemic.”
“…in a world where deflationary forces are gaining steam, and pressure on GDP growth will likely persist for some time. Lower yields on long-term government bonds seem the logical conclusion, as this 40 year bull market continues and the curve flattens towards 0%.”
https://seekingalpha.com/article/4367542-coming-depression-part-ii-age-of-deflation
“…deflation remains far more likely [than inflation]. Only once in the 46 years that Cornerstone tracked was deflation a greater specter than it is today, and that was for a brief interlude during the global financial crisis.”
“Around the world, young people armed with new degrees, diplomas and professional qualifications are struggling to enter the workforce as the pandemic pushes the global economy into recession.
“COVID-19 has thwarted hopes of landing first jobs – important for jumpstarting careers – as employers cut back graduate recruiting plans or even revoke job offers.”
https://abcnews.go.com/Business/wireStory/pandemic-wrecks-global-class-2020s-hopes-job-72277339
You can read the previous ‘Economic’ thread here and visit my Patreon page here.
