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Deepnews Digest #54

Getting Down to It. The Downturn – UPDATE

The International Monetary Fund has called it “The Great Lockdown” and compared it to an event that has come up more and more often, the Great Depression of 1929. What is increasingly clear is that our current moment has the potential to change the way that our economies work for the rest of our lives, whether on the scale of the international, national or local. It is a lot to take in, though all those angles are present in the update to last week’s Digest on the economic downturn, which we hope provides some information to help start making sense of things.


Editor’s Note: I hope you find these Digests useful as we continue coming to terms with coronavirus. I am always open to suggestions on angles of the crisis that you find interesting so feel free to send a note to the Contact page. There are also often updates about what Deepnews is up to on social media, so check us out on Facebook, Twitter and Linkedin.
Story Source
Meduza
With most Russian regions under some form of self-isolation as the COVID-19 pandemic escalates, mass job cuts and layoffs have begun. As in other countries around the world, many Russian companies no longer have money to pay their workers, but what makes their situation unique is that it’s practically been codified from the very top of the federal government down:

Editor’s Note:

Seattle Times
Ruby Holland had received unsolicited offers for her house in Seattle’s Central District several times before, and they irked her. Worried about zoning changes and development pushing longtime residents out amid the city’s tech boom, she started a group to help other neighbors resist such inquiries and stay.

Editor’s Note: One of the places where many people feel most tied to the economy is through their home, either rented or owned. Here the Seattle Times’ reporters Daniel Beekman and Katherine Kashimova Long explore all the angles around real estate, fear and gentrification. – Christopher Brennan, Editor

Freight Waves
The coronavirus pandemic will permanently change ocean shipping, but how? The short answer is: It depends on how long the outbreak lasts. A 2020 plunge and 2021 snapback is one thing, a multi-year global depression punctuated by geopolitical chaos is another.

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Washington Examiner
In recent weeks, Washington has failed Main Street yet again with its heavy-handed, one-size-fits-all approach to stopping the coronavirus pandemic. Yes, of course we should listen to health experts and continue to engage in social distancing and other safe practices: It’s our duty to our fellow Americans, especially the most vulnerable.

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Financial Times ($)
The gap between the relatively quick V-shaped recovery that some economists and many market participants predict, and grim coronavirus-driven realities on the ground has narrowed. But the disparity is still significant enough to pose difficult questions for investors.

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Foreign Policy ($)
But even the unprecedented agreement reached Friday shows there is no easy way to halt the rapid collapse in global oil demand due to the coronavirus pandemic.

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Reuters
BEIJING – The slump in China’s exports is expected to have extended into March while a collapse in oil price likely deepened a decline in imports, a Reuters poll showed, as the coronavirus cripples the global economy and overall demand.

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The Wrap ($)
“I honestly don’t know what our situation will be like next month, let alone if we are still closed through July or August,” theater owner Adam Bergeron tells TheWrap

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Washington Post
Thursday’s bad news was that, in the process, the U.S. economy has been flattened.

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Al Jazeera
Buenos Aires, Argentina – Even before the alarm about the novel coronavirus set in, a group of 36 mothers in one of Buenos Aires’s largest and poorest barrios, or neighbourhoods, had made it their mission to educate their neighbours about the viruses that were lurking.

Editor’s Note: A topic even before the coronavirus, inequality has come into high relief in many parts of the world, including Argentina. Here Natalie Alcoba reports from Buenos Aires for Al Jazeera. – Christopher Brennan, Editor

Nieman Lab
“We are all going to jump ahead three years,” Mike Orren, chief product officer of The Dallas Morning News, suggested to me last week.

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WSJ ($)
Near-term economic shocks seen giving way to changing needs, bigger inventories to meet consumer markets

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The Hill
Anyone who thinks that after the coronavirus lockdown has been lifted the United States will experience a V-shaped economic recovery has not been paying sufficient attention to a brewing repeat of the European sovereign debt crisis. Nor have they been paying much attention to the increased signs of real trouble in the emerging market economies that now constitute around half of the world economy.

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The Conversation
The coronavirus pandemic is devastating small businesses across the U.S. because of shelter-in-place orders that have forced millions to temporarily close. So far, Congress has devoted more than US$375 billion to helping restaurants, retailers and other small companies endure the crisis, and lawmakers are currently discussing spending hundreds of billions more.

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NY Post
Since the coronavirus shutdown began, nearly 17 million Americans have lost their jobs. That’s one-tenth of the nation’s workforce. It’s a public-health disaster. If the shutdown drags on, as many public-health experts recommend it should, it is almost certain to kill more Americans than the virus.

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Caixin
Hong Nam-ki is South Korea’s deputy prime minister and minister of economy and finance.

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Governing
As Congress considers further financial help for victims of the coronavirus pandemic, the magnitude of the fiscal crisis that governors and their states will have to face is just starting to emerge.

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ABC News
When Brandon Lindley applied for a low-interest, forgivable loan through the federal government’s Paycheck Protection Program, he was hoping to borrow enough money to be able to pay the handful of workers split across his two sandals stores, and a few of the bills that continue to pile up while his shops are shuttered due to the novel coronavirus. He didn’t know that businesses with thousands of employees and hundreds of locations would be eligible for the same funds.

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Bloomberg
Motorists on a typical weekday log roughly 200,000 trips on North Carolina’s Triangle Expressway in the Raleigh-Durham region, many of them commuters headed to the state’s Research Triangle Park. But on the first Monday in April, just 69,000 tolls were collected.

Editor’s Note: There are articles on this list that deal with oil and there are articles on this list that deal with state budgets. This one touches on both, making the tie between measures like gas taxes and the way that U.S. states finance their programs. – Christopher Brennan, Editor

The East African
The global coronavirus pandemic is going to send Africa into its first recession in 25 years, as economies get battered by lockdowns. According to the World Bank Africa’s Pulse report, the continent’s economic growth will also drop from 2.4 per cent in 2019 to between -2.1 to -5.1 per cent in 2020, impacted by the virus outbreak.

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Times of India
Pakistan has left open key export industries, including textiles. For nations that lack a social safety net, “full lockdowns will only lead to more hunger, starvations and death,” says Luhut Pandjaitan, a senior minister in Indonesia, which was slow to issue travel restrictions and stay-at-home orders.

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International Monetary Fund
The world has changed dramatically in the three months since our last update of the World Economic Outlook in January. A rare disaster, a coronavirus pandemic, has resulted in a tragically large number of human lives being lost. As countries implement necessary quarantines and social distancing practices to contain the pandemic, the world has been put in a Great Lockdown. The magnitude and speed of collapse in activity that has followed is unlike anything experienced in our lifetimes.

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NY Mag
As other countries have looked enviously at South Korea’s effective response to the coronavirus crisis, we keep hearing that that country had the advantage of a dry run: In 2015, South Korea faced an outbreak of Middle East Respiratory Syndrome, a coronavirus that is more deadly but less contagious than the one we’re fighting now. South Korea learned what had worked in that fight and what needed to be done differently, and the government developed epidemic-response capabilities it could take right out of the box for this crisis, which allowed South Koreans to achieve better infection control with less economic disruption than in the U.S. and Europe.

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Yale Daily News
This sense of frustration is new. We can’t just apply to more programs or find other opportunities. No matter how hard we try, we can’t escape coronavirus. This lack of agency is unfamiliar, and contradicts the narrative we tell ourselves. We’re taught that we can control — and are thus responsible for — our success. After all, isn’t that how we got into Yale? Perfection is within reach: We just need to work harder.

Editor’s Note: Last week the Digest included an article about the plight of Millennials. This edition we get an article from one of the unexpected places that Deepnews searches, college newspapers. Here Rabhya Mehrotra reflects for fellow Yalies on what it is like to see hopes of success become derailed. – Christopher Brennan, Editor

WSJ ($)
No one expected 2020 would unleash a world-wide oil-production cut led by the U.S., Saudi Arabia and Russia. But since the new coronavirus hit, the world’s thirst for oil has vanished, creating an unprecedented crisis for one of the planet’s most powerful industries.

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