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Archive for 2. April 2020

Bill Gates lays out three‑point plan for US on brink of coronavirus catastrophe

Posted by hkarner - 2. April 2020

Date: 01‑04‑2020

Source: South China Morning Post

Subject: Ÿ    Gates introduced a three‑point plan that includes a ‘consistent nationwide approach’ to lockdowns

Ÿ    He urged leaders to help by ‘not stoking rumours or panic buying’

Microsoft co‑founder Bill Gates urged world leaders to prepare for a pandemic in 2015.

Microsoft co‑founder and philanthropist Bill Gates, who urged world leaders to prepare for a pandemic situation in 2015, laid out a three‑point plan on how the US could make it through the coronavirus pandemic.

Gates penned an op‑ed for The Washington Post on Tuesday, making recommendations based on expert consultations he has had through his work with the Gates Foundation, which is funding research for a treatment for the virus, which causes a respiratory disease known as Covid‑19.

“There’s no question the United States missed the opportunity to get ahead of the novel coronavirus,” Gates wrote. “But the window for making important decisions hasn’t closed.”

“The choices we and our leaders make now will have an enormous impact on how soon case numbers start to go down, how long the economy remains shut down and how many Americans will have to bury a loved one because of Covid‑19.”

As of April 1, the coronavirus has infected nearly 190,000 in the US, and the countrywide death toll has surpassed 4,000.

Gates said the first point is calling for a “consistent nationwide approach” to lockdowns that are being imposed to contain the spread of the disease in the country. He called the fact that some states are not being shut down completely a “recipe for disaster”. Den Rest des Beitrags lesen »

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An imaginative template for dealing with the cash crunch

Posted by hkarner - 2. April 2020

Date: 26‑03‑2020

Source: The Economist: Buttonwood

The world of distressed lending offers a guide

Take yourself back, if you can manage it, to a more tranquil time—January, say. Imagine a smallish restaurant chain that had a bad Christmas. Its owner borrowed heavily to expand only to find its new outlets were slow to attract customers. The chain cannot meet its interest and other costs. A consultancy says $10m is needed to tide the firm over until its problems are fixed. The bank says it will forgo interest payments worth $5m, if the owner kicks in $5m of equity capital. A deal is struck.

Fast‑forward a few weeks and imagine a similar chain that is temporarily shut down because of the covid‑19 virus. The firm has no revenue, but it still has fixed costs. The hypothetical January deal is a template for dealing with the problem. But in a broader crisis, things are always trickier. The bank’s balance‑sheet is stretched to the limit. The stockmarket crash has taken a bite from the owner’s wealth. And she is reluctant to sell a stake in the business.

An alternative is to turn to specialist private‑credit funds. These are vehicles backed by long‑term investors, such as insurance firms, sovereign‑wealth funds and university endowments, which lend directly to companies, much as a bank would. Some will have discrete distressed‑lending or “special‑situation” arms. Many more are prepared to put up capital when others won’t. And everything is a special situation now. So the mindset and methods of these specialists will need to be broadly applied. Den Rest des Beitrags lesen »

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