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Deepnews Digest #53

Getting Down to It. The Downturn

Editor: Christopher Brennan

While some countries are looking at slowly lifting their lockdowns, the world is entering the beginning of the end, or the end of the beginning of coronavirus. What comes next are all the questions about how coronavirus affected the economy, jobs and the government response. This Digest looks at all articles that discuss coronavirus along with the looming “recession.” Definitive answers are hard, though these pieces tackle problems like how long the downturn will last, who will be hit hardest, and how we come out of it.


Editor’s Note: Thank you as always for following the Deepnews Digest. These newsletters go out on Wednesdays and Fridays, though the conversation keeps going on Facebook, Twitter and Linkedin throughout the week. Beyond the Digest, we also post links to the Distills so you can check out the first three articles, even if you don’t subscribe.
Story Source
Vox
On March 31, about 300 tenants received an email from their apartment management company. The email listed resources for tenants struggling financially during the coronavirus pandemic, but the sign-off message was clear: The rent is still due.

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Macleans
Miles Corak: No one has the numbers we most need that would tell us how much damage the economy has suffered, or how long this will last

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Financial Times ($)
Air conditioners have to shoulder some of the blame for slowing US economic growth. Americans have been moving south and west as the cooling devices have made the hot summers more bearable.

Editor’s Note: The economic downturn will have a painful impact on so many people, though there is a group of economists that argues for some benefits in a stagnant economy. Here Gavin Jackson discusses two books, “Slowdown” and “Fully Grown.” – Christopher Brennan, Editor

Eurasia Review
There are several recovery path may be following in the global economy. These are V-shaped, L-shaped and U-shaped. The V and U shaped recovery are demand side recovery and L shaped recovery is the supply side recovery. The V-shaped recovery is observed when real economic recovery occurs followed by real recession. In the U-shaped recovery, the recession persists impacting output to decline permanently with a gradual rebound.

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CapX
It was said of the financial crisis that it was a once in a century event – and no doubt many of my generation hoped t it would be the only epoch-defining economic catastrophe we would live through.

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Project Syndicate
During the global financial crisis of 2008, G20 leaders coordinated a global response, and in other emergencies – such as tsunamis, civil wars, or epidemics – coalitions of countries have convened donor conferences to generate the necessary resources. Today, we need both.

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Australian Financial Review ($)
“It does have a slight whiff of that New Year’s eve feeling, where everyone announces resolutions about what they’re going to do differently, and then by the time February comes along they’re just doing what they’ve always done,” he says.

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The Hill
The COVID-19 pandemic is the most serious public health crisis in the United States in a century, and it may cause an economic crisis worse than the Great Recession. The two crises are intertwined because the steps necessary to contain the virus — social distancing and shuttering businesses — are crippling the economy. The nation’s top economists tell us that we can’t save the economy without winning the war against the disease. However, the state and local governments on the front lines tragically lack the resources they need to succeed.

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Crikey
Everyone is feeling the financial squeeze of the coronavirus crisis. But it’s young people who stand to be among those hit the hardest.

Editor’s Note: Several of the articles on this list deal with the plight of Millennials, a group centered around those born between 1985 and 1995, who have now been hit with two economic crises as they get into their careers. The question is what can be done to prevent their economic lives from never recovering. – Christopher Brennan, Editor

Foreign Policy ($)
Facing a coronavirus-aggravated economic downturn, Argentine President Alberto Fernández is walking a foreign-policy tightrope between Bolivia, Venezuela, and the United States.

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Houston Chronicle
It seems like an eternity since two major events occurred that brought the energy industry to the brink of collapse.

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The Wharton School (UPenn)
After a double whammy during the past week, the unemployment pains triggered by the coronavirus pandemic seem likely to worsen in the U.S. in the coming months. The number of people filing for unemployment insurance doubled to 6.65 million in the latest weekly report on April 2, taking the two-week total to nearly 10 million. On April 3, the unemployment report for March logged a loss of 701,000 jobs, making it the worst month for unemployment since the last recession. It also took the unemployment rate to 4.4% in March from 3.5% in February, the largest one-month increase since January 1975.

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Channel News Asia
SINGAPORE: In February, final-year undergraduate Bianca Chua thought she was all set for the working world after starting her internship as a headhunter at a human resource (HR) firm.

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Reuters
BRUSSELS – European Union finance ministers agreed on Thursday on half-a-trillion euros worth of support for their coronavirus-battered economies but left open the question of how to finance recovery in the bloc headed for a steep recession.

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Bloomberg
Latin America’s economy was already going backward when the coronavirus hit. Now it’s at risk of losing a whole decade –- and pushing fragile democracies closer to their breaking points.Like most of the world, the region is bracing for the deepest recession in its modern history. Bank of America expects a 4.4% slump in output this year as the epidemic spreads.

Editor’s Note: The coronavirus slowdown is hitting countries without caring whether their prospects were rosy or gloomy three months ago. Here Bloomberg reporters in Mexico and Argentina team up for a look at what happens in South America, including the potential for unrest. – Christopher Brennan, editor

Financial Times ($)
Martin Slumbers usually works from a wood-panelled room overlooking the 18th green of the Old Course at St Andrews in Scotland. The chief executive of the R & A, golf’s governing body outside the US and Mexico, says his office was closed two weeks ago. The same goes for the ancient links, the first time this has happened since the second world war.

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Rappler
MANILA, Philippines – The coronavirus pandemic has forced governments to freeze economic activity to save lives.

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The Guardian
Europe’s governments have begun to look ahead to the post-lockdown phase of their battle against Covid-19 as curves on the continent flatten, while the US braces for “peak death week” and Japan prepares to declare a state of national emergency.

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The New York Times
The Coronavirus Contentious talks over how to help economies decimated by the virus have become a pivotal political moment for the world’s richest bloc of nations.

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Reuters
LONDON – Worry about the coronavirus pandemic, definitely. Worry especially about poor countries where social distancing is difficult and medical resources are scarce. Worry about the exit strategy for lockdowns and the damage to mental health from isolation. But do not worry too much about the economy.

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Post and Courier (South Carolina)
John Keener was counting on his insurance company to help pull him through tough times after his four Charleston restaurants were forced to close last month because of COVID-19 restrictions. Keener had been through similar shutdowns during Hurricanes Irma and Matthew, and his business interruption insurance claims were always handled promptly.

Editor’s Note: Part of a recession is not just the macroeconomic impact on businesses like insurers, but the individual cases that their decisions affect. Local reporters often offer a look that is closer to the ground than the big national outlets, as the Post and Courier does here. – Christopher Brennan, Editor

CNN
How do you restart an economy that’s been shut down by a pandemic? The answer is: very, very carefully.

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The Nation
As in 2008, the financial relief package leaves most Americans behind. It’s only a matter of time before it leads to an even bigger crisis.

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Nikkei
James Crabtree is an associate professor in practice at the Lee Kuan Yew School of Public Policy at the National University of Singapore. He is author of “The Billionaire Raj.”

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Brookings
What effect will the COVID-19 pandemic have on the 9.2 million Americans working in logistics? Adie Tomer joins David Dollar to discuss the geographic distribution of logistics workers, their role in supply chains, the lack of protection for essential workers, and the necessity to create a more equitable social contract for America’s labor force.

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