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You're absolutely right. We (EU+US) will be lucky to get over it with less than 30% GDP loss. Mostly because the schmuckery that got us out last time doesn't ap

You're absolutely right. We (EU+US) will be lucky to get over it with less than 30% GDP loss. Mostly because the schmuckery that got us out last time doesn't appear to work this time.

gizmo385 7y ago
It's been said repeatedly, but this isn't a crisis that can be fixed with monetary policy alone. The health crisis that was the catalyst needs to be solved - everything else is just a bandaid.
- llcoolv 7y ago
  It is a crisis, which is caused by monetary politics and politics overall. The coronavirus was as you say just the catalyst.
  - aggie 7y ago
    You're stating this as a fact. Can you provide any reasoning or evidence?
    - llcoolv 7y ago
      First of all, thank you very much for reasoning instead of downvote, swear & deny. I really do appreciate it. I do - over the last 10 years of extensive money printing companies seemed to be healthy, but gathered structural problems, which were not only not solved, but deepened by expanding regulations and such. Just before the crisis started most of the investment grade instruments were BBB (one slight blow away from junk).[0] In December there was a presentation by the local Mieses Institute where a hypotetical scenario similar to what is happening right now (it was a war near EU + another migrant wave leading to in-EU border closures and state of emergency in multiple countries) was played out. What was predicted is extremely similar to what is playing out right now, though the initial shock was supposed to be weaker. I am really sorry the presentation was not in English, it really had all my thoughts put together in a very coherent way. Keep in mind that the 30% drop is just market panic. There have been no bankrupcies, defaults and layoffs yet. This is when the fun is going to start. Another thing that was predicted exactly was that if you look deeper, beyond the indexes, at how the first tranche of the $1.5 trillion package was spent you'd see that hot companies like MSFT restored their value, while troubled ones like UAL received almost nothing. So the bankrupcies, defaults and layoffs have not yet begun and we are already 30% down. What is going to remain after they're done? 0. OECD - "Figure 8. Composition of the investment and non-investment grade categories" https://www.oecd.org/corporate/Corporate-Bond-Markets-in-a-Time-of-Unconventional-Monetary-Policy.pdf https://www.oecd.org/corporate/Corporate-Bond-Markets-in-a-T... P.S. The rest of the OECD report makes for a very very interesting reading in a time like these. But what you're looking for in it is how at year 2000 most common investment grade is A followed by AA and BBB about even, while now it is a total clusterfuck (with apologies).
- mkagenius 7y ago
  > isn't a crisis that can be fixed with monetary policy alone but it might certainly help, for example, people might be willing to risk getting corona (if they are 20-40 year old) and are asked to do a job for a lucrative amount of money.
- rayhendricks 7y ago
  We need to pass legislation that includes 14 days of paid sick leave, waive all medical bills related to coronavirus, postpone all student loan payments. This is to minimize the impact to working members of society and to help ensure a swift recovery. Republicans are currently blocking this. If this continues to be blocked, we can expect to see 7% declines until such legislation is passed and the market sees that there is a path to recovery. Who knows maybe we’ll get another depression too.
  - llcoolv 7y ago
    I am sorry to disappoint you, but a serious depression lasting years is already inevitable no matter what.

You're absolutely right. We (EU+US) will be lucky to get over it with less than 30% GDP loss. Mostly because the schmuckery that got us out last time doesn't appear to work this time.

gizmo385 7y ago

It's been said repeatedly, but this isn't a crisis that can be fixed with monetary policy alone. The health crisis that was the catalyst needs to be solved - everything else is just a bandaid.

llcoolv 7y ago
It is a crisis, which is caused by monetary politics and politics overall. The coronavirus was as you say just the catalyst.
- aggie 7y ago
  You're stating this as a fact. Can you provide any reasoning or evidence?
  - llcoolv 7y ago
    First of all, thank you very much for reasoning instead of downvote, swear & deny. I really do appreciate it. I do - over the last 10 years of extensive money printing companies seemed to be healthy, but gathered structural problems, which were not only not solved, but deepened by expanding regulations and such. Just before the crisis started most of the investment grade instruments were BBB (one slight blow away from junk).[0] In December there was a presentation by the local Mieses Institute where a hypotetical scenario similar to what is happening right now (it was a war near EU + another migrant wave leading to in-EU border closures and state of emergency in multiple countries) was played out. What was predicted is extremely similar to what is playing out right now, though the initial shock was supposed to be weaker. I am really sorry the presentation was not in English, it really had all my thoughts put together in a very coherent way. Keep in mind that the 30% drop is just market panic. There have been no bankrupcies, defaults and layoffs yet. This is when the fun is going to start. Another thing that was predicted exactly was that if you look deeper, beyond the indexes, at how the first tranche of the $1.5 trillion package was spent you'd see that hot companies like MSFT restored their value, while troubled ones like UAL received almost nothing. So the bankrupcies, defaults and layoffs have not yet begun and we are already 30% down. What is going to remain after they're done? 0. OECD - "Figure 8. Composition of the investment and non-investment grade categories" https://www.oecd.org/corporate/Corporate-Bond-Markets-in-a-Time-of-Unconventional-Monetary-Policy.pdf https://www.oecd.org/corporate/Corporate-Bond-Markets-in-a-T... P.S. The rest of the OECD report makes for a very very interesting reading in a time like these. But what you're looking for in it is how at year 2000 most common investment grade is A followed by AA and BBB about even, while now it is a total clusterfuck (with apologies).
mkagenius 7y ago
> isn't a crisis that can be fixed with monetary policy alone but it might certainly help, for example, people might be willing to risk getting corona (if they are 20-40 year old) and are asked to do a job for a lucrative amount of money.
rayhendricks 7y ago
We need to pass legislation that includes 14 days of paid sick leave, waive all medical bills related to coronavirus, postpone all student loan payments. This is to minimize the impact to working members of society and to help ensure a swift recovery. Republicans are currently blocking this. If this continues to be blocked, we can expect to see 7% declines until such legislation is passed and the market sees that there is a path to recovery. Who knows maybe we’ll get another depression too.
- llcoolv 7y ago
  I am sorry to disappoint you, but a serious depression lasting years is already inevitable no matter what.