The microscopic pathogen that is threatening global health and wreaking havoc from Singapore to Seoul, Tokyo to New York and Berlin to Milan is clearly reshaping the 2020 global outlook. But it should not derail the current momentum driving sustainability investing and corporate governance.
The future shape of the economic crisis driven by the federal government’s inadequate response to the coronavirus pandemic are coming into focus. The widespread social isolation that has sent both the demand for and production of goods and services into a free-fall reflects our spotty knowledge about the contagiousness and lethality of the virus. At the same time, we don’t know where hospital admissions will spike next. These new facts of life point to two potential economic scenarios, based on aspects of the virus that are beyond our control.
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The federal government has approved two “phases” of fiscal relief for the current COVID-19 crisis, an $8B bill supporting medical work and expanding testing for the virus signed on March 6, and a $100B expansion of sick and family medical leave that President Trump is signing today. The vastly larger Phase 3 package will likely come up for a vote within the next several days. Collectively, this fiscal stimulus will cost more than a trillion dollars, putting it on par with the combined Obama and Bush administrations’ responses to the Great Recession.
This report is written by Eleanor Hughes, Writer & Commentator, East Asian Affairs.
The Federal Reserve’s interest rate cut on Tuesday certainly won’t hurt the financial markets or the real economy, but as the subsequent steep drop in stock prices shows, the cut won’t help much, either. Three forces stand in the way.
“Nobody wants a trade war,” but the long-lasting trade conflict between the world’s two largest economies, the United States and China, just reached a truce after almost two years.
On 22 March 2018, President Donald Trump directed the United States Trade Representative (USTR) to start investigating China’s ‘unfair’ trade practices covered in Section 301 of the Trade Act of 1974.
The outbreak of the 2019 novel coronavirus is so potentially impactful that we are devoting this entire edition to the epidemic, to an attempt to gauge its seriousness. Some stories are so big that it is hard to get your arms around them and this one definitely fits that category. Social media wasn't a factor during the 2003 SARS epidemic. The Chinese economy was a much smaller percentage of global GDP, and travel to and from China was far less common. So a simple comparison to SARS is not enough.