Quote (dro94 @ 27 Apr 2020 00:53)
Good summary, thanks for posting it!
I'm not so sure that Germany is in decent shape. We have a large sector of small- and medium-size firms, and our economy is very export-oriented. If the whole world economy is going through a downturn all at once, this should hurt our export companies a ton. Also, fiscal stimulus only goes so far to stabilize demand in foreign markets. Like... if the US or UK government take a lot of debt to stablize their domestic consumption, this has a stronger stabilizing effect on the respective economies than if the German government did the same, simply because a lot of our most important markets wont be able to avoid the bottom falling out.
My personal theory is that the economic curve of the crisis will end up looking like a mirrored square root sign: a sharp recession, followed by a sharp recovery which, however, doesnt get back up to the pre-crisis level.
Quote (excellence @ 27 Apr 2020 01:25)
it would be impressive if this is attained, given how far-reaching the shutdown has been worldwide
If the lockdowns can be loosened and the economies start running again over the course of May and June, then a lot of the missed production and consumption can be caught up. The bigger problem that I see is that tourism, sports, entertainment and live event industries will keep hurting a ton, and the longer-lasting loss of income and economic activity in these sectors will dampen the entire economy through falling demand/disposable incomes.
In the intermediate term, in 2-3 years, we might run into a massive issue with public debt and inflation.