Everybody Wears A Mask-- But They Won't Stop A Recession Or A Depression

Yesterday, on top of historically high unemployment insurance filings, NBC News reporters Kasie Hunt and Alex Moe had some more bad news on the personal financial front-- Trump Regime incompetence on full display: "The first Americans to get relief payments from the government under the coronavirus legislation signed into law last month won’t see the money until at least the week of April 13, according to new estimates from the Trump administration provided to House Democrats and outlined in a memo circulated this week by Democrats on the House Ways and Means Committee. Many people who don’t have direct deposit information on file with the IRS might have to wait months to get the money."

That's a drag... and yesterday, the NY Times reported that "The speed and scale of the job losses is without precedent. Until last month, the worst week for unemployment filings was 695,000 in 1982." Pray it's only a recession that Trump has brought us-- even a horribly long one. Peter Goodman: "The world is almost certainly ensnared in a devastating recession delivered by the coronavirus pandemic. Now, fears are growing that the downturn could be far more punishing and long lasting than initially feared-- potentially enduring into next year, and even beyond-- as governments intensify restrictions on business to halt the spread of the pandemic, and as fear of the virus reconfigures the very concept of public space, impeding consumer-led economic growth.

The abrupt halt of commercial activity threatens to impose economic pain so profound and enduring in every region of the world at once that recovery could take years. The losses to companies, many already saturated with debt, risk triggering a financial crisis of cataclysmic proportions.

Stock markets have reflected the economic alarm. The S&P 500 in the United States fell over 4 percent on Wednesday, as investors braced for worse conditions ahead. That followed a brutal March, during which a whipsawing S&P 500 fell 12.5 percent, in its worst month since October 2008.

“I feel like the 2008 financial crisis was just a dry run for this,” said Kenneth S. Rogoff, a Harvard economist and co-author of a history of financial crises, This Time Is Different: Eight Centuries of Financial Folly.

“This is already shaping up as the deepest dive on record for the global economy for over 100 years,” he said. “Everything depends on how long it lasts, but if this goes on for a long time, it’s certainly going to be the mother of all financial crises.”

The situation looks uniquely dire in developing countries, which have seen investment rush for the exits this year, sending currencies plummeting, forcing people to pay more for imported food and fuel, and threatening governments with insolvency-- all of this while the pandemic itself threatens to overwhelm inadequate medical systems.

...The sense of alarm is enhanced by the fact that every inhabited part of the globe is now in trouble.

The United States, the world’s largest economy, is almost certainly in a recession. So is Europe. So probably are significant economies like Canada, Japan, South Korea, Singapore, Brazil, Argentina and Mexico. China, the world’s second-largest economy, is expected to grow by only 2 percent this year, according to TS Lombard, the research firm.

For years, a segment of the economic orthodoxy advanced the notion that globalization came with a built-in insurance policy against collective disaster. So long as some part of the world economy was growing, that supposedly moderated the impact of a downturn in any one country.

The global recession that followed the financial crisis of 2008 beggared that thesis. The current downturn presents an even more extreme event-- a worldwide emergency that has left no safe haven.

...Between now and the end of next year, developing countries are on the hook to repay some $2.7 trillion in debt, according to a report released Monday by the U.N. trade body. In normal times, they could afford to roll most of that debt into new loans. But the abrupt exodus of money has prompted investors to charge higher rates of interest for new loans.

The U.N. body called for a $2.5 trillion rescue for developing countries-- $1 trillion in loans from the International Monetary Fund, another $1 trillion in debt forgiveness from a broad range of creditors and $500 billion for health recovery.

“The great fear we have for developing countries is that the economic shocks have actually hit most of them before the health shocks have really begin to hit,” said Richard Kozul-Wright, director of the division on globalization and development strategies at the U.N. trade body in Geneva.

You think that sounds bad? Washington Post economics columnist Robert Samuelson was envisioning a depression yesterday. Obama made it look so easy, didn't he. So why not give a dumb, crooked loud-mouthed TV game show host a chance? This is why.

Samuelson wrote that when he "began writing about economics in the early 1970s, I made a private vow that I would never use the word 'depression' in describing the state of the economy. The economists and politicians who occasionally did so were, I thought, engaged in partisan hyperbole. Their game was to scare people into thinking the end of the world was at hand or to pressure Congress to enact a favored piece of economic legislation. Well, times change. I revoke my vow. It’s not that I’ve concluded that we’re already in a depression. But we could be. For the first time in my life, I think it’s conceivable. This obviously would be a big deal. It implies permanently higher levels of unemployment (though joblessness would still fluctuate), greater economic instability and a collision between democracy and the economic system."

So how are the Trumpists taking all this news? I picked this up from People For the American Way last night: "Anthony Fauci-- the nation’s leading expert on infectious diseases who has served six presidents of both parties and is arguably the most trusted voice in America right now on the coronavirus pandemic-- is now facing DEATH THREATS from the Right Wing thanks to social media conspiracy theories and headlines like the one from the right-wing American Thinker that referred to Fauci as a 'Deep-State Hillary Clinton-loving stooge.'"