Coronavirus Heads to the Markets – UPDATE #46

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Deepnews Digest #46

Coronavirus Heads to the Markets – UPDATE

Last week’s Digest on coronavirus and the economy looked at different business sectors and parts of life where the disease was making itself felt. As events change rapidly day by day, Deepnews has decided to provide more regular updates about different angles of the crisis. This mid-week Digest again covers the economy, but focuses on the global and national responses as countries around the world prepare for months on lockdown.

Editor’s Note:
Deepnews is trying to help sort through good and bad information on coronavirus as much as we can, with many of our weekly Distill newsletters now highlighting important pieces on the crisis. New additions this week include “Future of Medicine” and “Gig Economy,” which have been in planning for months but now have an importance we could never have guessed at. To follow along more closely, please follow us on Twitter, LinkedIn and Facebook
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AP
WASHINGTON — No one knows how long it will last or how much it will hurt. But the U.S. economy is either sliding into a recession for the first time since 2009 or is already in one — a sudden victim of the coronavirus outbreak.

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Financial Post
How long will this last? That’s the question at the top of every Canadian’s mind as we deal with a public-health threat and a potential economic recession due to the coronavirus pandemic.

Editor’s Note: One of the biggest questions about the coronavirus crisis and the economic hit is how long it will last. Here Dr. Jack Mintz of University of Calgary delves into it for the Financial Post.

Reuters
BEIJING — China’s industrial output contracted at the sharpest pace in 30 years in the first two months of the year as the fast spreading coronavirus and strict containment measures severely disrupted the world’s second-largest economy, data showed on Monday.

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The Guardian
Tax relief and help with borrowing for firms is needed but for workers Germany’s short-time work allowance should be copied

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CapX
As the news continues to deteriorate, I’m warming to the idea of some sort of temporary universal basic income (UBI), or at least a one-off universal cash payment, to help tackle the economic fallout from coronavirus. My opening bid is a handout of £1,000, Hong-Kong-style but with UK characteristics. If the crisis is over quickly, that would be it. If not, go again.

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Ahval News
The coronavirus outbreak is hitting the Turkish economy just when it began to show signs of recovery after a prolonged recession.

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Digiday
The dizzying number of suspended events, postponed launches and disrupted travel over the last week doubled as a series of epiphany moments for many advertisers. Initially, advertisers thought the coronavirus would have a short, sharp shock to economy whereas now they’re braced for its effects to linger for months.

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The Conversation
New Zealand will spend NZ$12.1 billion to support businesses, increase benefits for seniors and low-income families, pay people who can’t work because of self-isolation, and boost virus testing and intensive care capacity.

Editor’s Note: Several of the articles on this list deal with the idea of giving money to citizens to tide them over. Here is the view from New Zealand in The Conversation.

AP
DETROIT — When the coronavirus cut off the flow of parts from China in early January, most global automakers were ready: Anticipating such a crisis, they had prepared to tap other suppliers and to conserve parts that they had stored.

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Reuters
TOKYO – Japan will consider various measures, including tax cuts, to deal with deepening damage to its economy from the coronavirus outbreak, economy minister Yasutoshi Nishimura said on Tuesday, amid growing debate on the possibility of cutting sales tax.

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South China Morning Post
The number of gig workers in Singapore, the Philippines and Indonesia is growing and their incomes have been hit by the coronavirus crisis

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Washington Post
We need to temporarily transfer a lot of money to a lot of households and businesses.

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The Conversation
It’s a commonly searched question since the coronavirus and COVID-19 outbreak: how will coronavirus affect house prices?

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Nikkei
SINGAPORE — Singapore’s economy delivered a positive surprise amid the COVID-19 gloom as non-oil exports grew rather than shrank in February, powered by a rise in shipments to the European Union, Japan and the U.S.

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Bloomberg
Angela Merkel signaled she may be open to joint European Union debt issuance to help offset the impact of the coronavirus, an apparent softening of entrenched German opposition that could transform the finances of the 27-nation bloc.

Editor’s Note: While many countries are responding in their own way, this crisis has raised the idea that the countries of the European Union would work more closely together to limit the damage. Bloomberg reports.

MercoPress
Brazil’s government on Monday announced emergency measures to inject nearly 150 billion reais (US$ 30 billion) into the economy to soften the blow from the coronavirus pandemic.

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CNN
European governments are writing blank checks to protect businesses and workers from the deep recession into which the global economy is sinking rapidly because of the coronavirus pandemic.

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Economic Times (Times of India)
We face the greatest medical-cum-economic crisis in history. Admit it or not, the coronavirus has already created a deep global recession. Even earlier, Europe and Japan verged on recession while Indian GDP growth had halved from its peak. This leaves little resilience to meet the coming hurricane.

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The Guardian
Coronavirus is a grave threat to the economy and the lives of millions – a new benefit payment for all affected workers should be just the start

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Bloomberg
Oil’s spectacular collapse deepened as widening global efforts to fight the spread of coronavirus were set to trigger the most severe contraction in annual oil demand in history.

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The New York Times
Gig companies promoted their flexible hours as an economic lifeline for workers. In the coronavirus outbreak, it has been anything but.

Editor’s Note: One of the most immediate economic impacts of the crisis thus far has been on gig economy and service workers. More articles dealing explicitly with this issue made up the lion’s share of our Gig Economy Distill this week.

AP
FRANKFURT, Germany — With the global economy melting down after the failure of Lehman Brothers in 2008, world leaders swiftly created an international forum that committed to boost economies by spending more and keeping trade open. Central banks announced rate cuts within seconds of each other.

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The New York Times
Bailouts of companies or industries just cause division. The answer: a government “bridge loan” to everyone.

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Washington Post
Airlines, hotels, cruise companies and others are pleading for government help, but the White House hasn’t said where it might draw the line.

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The Atlantic
Mitt Romney has joined the chorus of voices calling for all Americans to receive free money directly from the government.

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