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Right. And from what I understand, even if monetary policy does not directly solve virus or supply chain issues, it can make life easier for corporations loaded
by samvher 7y ago
Right. And from what I understand, even if monetary policy does not directly solve virus or supply chain issues, it can make life easier for corporations loaded with debt (there are many) which might get into trouble as the economy deteriorates.
- airstrike 7y agoI mean, it's not like rates were high to begin with. It may make a little bit of a difference for each company, but they are certainly way more concerned about their ability to generate cash to pay their interest if you assume a significant drop in demand.
- darkerside 7y agoAnd I think many would argue, better to let these companies die and be outcompeted
- abduhl 7y agoThen again many would counter this by asking “outcompeted by whom in a global recession?” For example: who is going to outcompete American Airlines/United/Delta if all international flights are grounded or flight restrictions get worse?
- shawnz 7y agoSo that they can be replaced by companies that are more robust to things like Coronavirus? Why would we care how robust our businesses are to such a rare event if we can mitigate it in other ways? You think it would be better to lose those businesses just for the chance at something better replacing them, just to avoid resorting to those mitigations?