Föhrenbergkreis Finanzwirtschaft

Unkonventionelle Lösungen für eine zukunftsfähige Gesellschaft

Posts Tagged ‘Coronavirus’

U.S. Economy Faces Projected 10‑Year Recovery From Coronavirus Effects

Posted by hkarner - 3. Juni 2020

Date: 02‑06‑2020

Source: The Wall Street Journal

Surveys of purchasing managers in U.S., Asia and Europe offer some hope that decline in factory activity is starting to bottom out

The U.S. economy could take the better part of a decade to fully recover from the coronavirus pandemic and related shutdowns, a U.S. budget agency said, as a series of surveys pointed to continuing weakness in global manufacturing.

The Congressional Budget Office, a nonpartisan legislative agency, said the sharp contraction triggered by the coronavirus caused it to mark down its 2020‑30 forecast for U.S. economic output by a cumulative $7.9 trillion, or 3% of gross domestic product, relative to its January projections. GDP isn’t expected to catch up to the previously forecast level until the fourth quarter of 2029, the CBO added.

 The roughly $3.3 trillion in stimulus programs enacted by Congress since March will only “partially mitigate the deterioration in economic conditions,” the CBO said.

“After you get the initial bounce of economic activity simply from removing the lockdowns, I think what we’ll see is an economy that is running at a level of activity notably below where we were prior to Covid,” said Michelle Meyer, chief U.S. economist at BofA Merrill Lynch. “It’s going to take a long time to heal. There will be scars as a result of such a painful shock of the economy.”

The CBO analysis came as new surveys showed that factories in the U.S. and abroad continued to reduce output and shed jobs in May, though the pace of deterioration moderated as governments moved to ease coronavirus‑related restrictions on their economies. Den Rest des Beitrags lesen »

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The Prehistory of Merkel’s Latest Coup

Posted by hkarner - 2. Juni 2020

Harold James is Professor of History and International Affairs at Princeton University and a senior fellow at the Center for International Governance Innovation. A specialist on German economic history and on globalization, he is a co-author of The Euro and The Battle of Ideas, and the author of The Creation and Destruction of Value: The Globalization Cycle, Krupp: A History of the Legendary German Firm, and Making the European Monetary Union.

German Chancellor Angela Merkel seems to see the historical writing on the wall. Her agreement to a €500 billion European recovery fund suggests that the COVID-19 pandemic has done what recent debt, refugee, and foreign-policy crises could not: inaugurate a new phase of the European project.

PRINCETON – Throughout her long chancellorship in Germany, Angela Merkel has repeatedly shown that she is good for a surprise. Now, she’s outdone herself.

In 2010, Merkel bucked expectations by insisting that the International Monetary Fund be included in the effort to rescue Greece. After 2011, she shut down Germany’s nuclear power plants, following the Fukushima disaster in Japan. Then, in 2015, she opened Germany’s borders to more than one million Syrian refugees. And now, she has agreed to a proposal for a joint €500 billion ($556 billion) recovery fund to help the European Union’s hardest-hit national economies through the COVID-19 crisis.Every one of these policy decisions has provoked howls of outrage in Germany, as well as hand-wringing by other Europeans who are reluctant to allow Germany an outsize leadership role. Den Rest des Beitrags lesen »

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Europe’s Non-Hamiltonian Muddle

Posted by hkarner - 2. Juni 2020

Brunello Rosa

Brunello Rosa, CEO and Head of Research at Rosa & Roubini Associates, is a visiting professor at Bocconi University.

Although any joint EU action should be welcomed, the current COVID-19 response plan hardly amounts to a radical break with business as usual. Far from a long-awaited embrace of debt mutualization, the newly proposed European recovery fund risks being both politically unpalatable and economically inadequate.

NEW YORK – This past week, the European Commission unveiled a plan to help European countries manage the Great Depression-scale shock from COVID-19. Building on a recent Franco-German proposal, the Commission is calling for a €750 billion ($834 billion) recovery fund (€500 billion of which would be distributed as grants, and €250 billion as loans).

The money issued through this so-called “Next Generation EU” plan will flow through European Union programs, in order to achieve the Commission’s goals, including its green and digital economy agenda. The Commission will raise funds in the market by issuing long-term bonds, and their efforts will be backed by a suggested increase in new taxes, such as those on greenhouse-gas emissions, digital services, and other areas of supranational commerce.Though we are among the few commentators who anticipated that the EU would offer a plan much larger than what most market participants and pundits expected, we also would advise European policymakers to remain realistic about what can be achieved at the moment. Den Rest des Beitrags lesen »

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So Where Did the Virus Come From?

Posted by hkarner - 1. Juni 2020

Date: 30‑05‑2020

Source: The Wall Street Journal By Matt Ridley

Research into the origins of the new coronavirus raises questions about how it became so infectious in human beings

New research has deepened, rather than dispelled, the mystery surrounding the origin of the coronavirus responsible for Covid‑19. Bats, wildlife markets, possibly pangolins and perhaps laboratories may all have played some role, but the simple story of an animal in a market infected by a bat that then infected several human beings no longer looks credible.

A study published in early May by scientists at the Broad Institute in Cambridge, Mass., and at the University of British Columbia has uncovered an unusual feature of the virus’s recent development: It has evolved too slowly. The genomes of viruses sampled from cases during the SARS epidemic of 2002‑2003 showed rapid evolutionary change during the early months of the epidemic, as the virus adapted to its new host, followed by much slower change later. By contrast, samples taken from recent cases of the new coronavirus, SARS‑CoV‑2, have comparatively few genetic substitutions compared with an early case from December. Den Rest des Beitrags lesen »

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Cummings is now a laughing stock. Alas, so is Britain

Posted by hkarner - 31. Mai 2020

Date: 31‑05‑2020

Source: The Guardian by William Keegan

The guru of Brexit and the 2019 election has been exposed. But the economic and social damage is well and truly done

Dominic Cummings: digging himself deeper.

My father, who was of Irish extraction but hailed from County Durham, used to say: never kick a man when he is down. After the shambles of Mr Dominic Cummings’s recent excursion to Durham, one might be tempted to make an exception to the rule. But there is no need. The prime minister’s once‑valued adviser has been kicking himself – but not in the colloquial sense of expressing regret for his actions.

Deeper and deeper he dug himself in, as one terminological inexactitude led to another, and the rule‑breaker failed lamentably to justify breaking government lockdown instructions for which he was at least in part responsible.

Now, I have never, to my knowledge, met Mr Cummings. But what amazes me, and almost everyone I know, is how this first‑class clown could have acquired a reputation for having anything resembling a brain. His snivelling appearance before the media in the garden of No 10 was a classic of its kind.

The eye test has made him an international laughing stock; and, while we are on the subject of sight, his supposed foresight in forecasting the outbreak of the plague must be making George Orwell laugh in his grave. In 1984, Big Brother’s team made forecasts once they knew the result. Cummings appears to have tried the same but was found out. The guru can, it seems, be sensationally incompetent. If only he had manifested such incompetence during the referendum campaign and the 2019 general election. In those days he was, alas, far more successful in distorting the truth. Den Rest des Beitrags lesen »

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The Limits of Extreme COVID Monetary Policy

Posted by hkarner - 31. Mai 2020

Paola Subacchi

Paola Subacchi, Professor of International Economics at the University of London’s Queen Mary Global Policy Institute, is the author, most recently, of The Cost of Free Money.

Just because the major central banks can continue to introduce increasingly unconventional measures doesn’t mean that they should. The current economic crisis demands primarily a fiscal-policy response, whereas extreme monetary policies carry high risks and produce adverse side effects.

LONDON – With output having collapsed as a result of the COVID-19 pandemic, many are wondering how far monetary policy can be stretched to support the economy. For the US Federal Reserve, negative interest rates appear to represent an effective limit, not because such a policy is technically unfeasible, but because it would be politically unacceptable. Yet for the European Central Bank, the Bank of England, and the Bank of Japan, there appears to be no limit.

The ECB has long since cut rates into negative territory, and BOE Governor Andrew Bailey is reportedly “looking very carefully” at that option for the United Kingdom. Likewise, BOJ Governor Haruhiko Kuroda, while deeming the BOJ’s current policy mix appropriate for current conditions, has not ruled out further monetary easing or another increase in asset purchases.The question is whether it makes sense to go further down the road of extreme monetary policy. Former ECB President Mario Draghi’s famous promise to do “whatever it takes” to support the euro has now become the mantra for all policymakers confronting the current crisis. But wouldn’t expanding fiscal policy be a better way to fulfill that commitment?

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What Should We Be Preparing For?

Posted by hkarner - 30. Mai 2020

Date: 29‑05‑2020

Source: Project Syndicate by Ricardo Hausmann

Ricardo Hausmann, a former minister of planning of Venezuela and former Chief Economist at the Inter‑American Development Bank, is a professor at Harvard’s John F. Kennedy School of Government and Director of the Harvard Growth Lab. 

In most emerging and developing countries, COVID‑19 is causing an economic hurricane. It looks increasingly like a Category 5, but the international community and many national governments prepared for a tropical storm.

CAMBRIDGE – Suppose you knew that a hurricane was coming, but meteorologists were uncertain if it would make landfall as a Category 2 or a Category 5 storm. Which scenario should you prepare for?

The problem you face reflects the costs of assuming that it is a Category 5 when it is only a Category 2 and vice versa. The latter scenario implies deaths and destruction that could have been avoided through evacuations, well‑supplied shelters, and precautionary shutdowns. The first scenario implies unnecessary preventive costs. In the case of hurricanes, we all agree that it makes sense to err on the side of caution for the same reason that it is better to be five minutes early when catching a train than five minutes late. Den Rest des Beitrags lesen »

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EZB-Chefin begräbt Hoffnung aus milden Konjunktureinbruch

Posted by hkarner - 29. Mai 2020

EZB-Präsidentin Christine Lagarde 

EZB-Präsidentin Christine Lagarde geht von einem BIP-Rückgang von bis zu 12 Prozent aus.  In Österreich verlangsamen sich der Abschwung in Industrie und Job-Abbau bereits.

Das Bruttoinlandsprodukt (BIP) der Eurozone dürfte heuer um 8 bis 12 Prozent sinken, sagte die Chefin der Europäischen Zentralbank (EZB) am Mittwoch bei einer Veranstaltung mit Jugendlichen. Bisher hatten die Währungshüter 5 bis 12 Prozent Minus angenommen. Die Chancen auf einen vergleichsweise „milden“ Einbruch seien nicht mehr vorhanden, räumte Lagarde ein. Stattdessen dürfte der Einbruch nun im „mittleren“ bis „schweren“ Bereich des ursprünglichen Szenarios liegen.

Das Bruttoinlandsprodukt in der Eurozone war bereits im ersten Quartal mit 3,8 Prozent in Rekordtempo geschrumpft. Im laufenden zweiten Vierteljahr rechnen Experten mit einem Minus zwischen 10 und 20 Prozent. Die Euroländer hatten mit umfangreichen Geschäftsschließungen und Beschränkungen des öffentlichen Lebens auf den Virusausbruch reagiert, was weite Teile der Wirtschaft stark beeinträchtigte.

Düstere DIW-Prognose

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Artificial Intelligence Can Serve Democracy

Posted by hkarner - 29. Mai 2020

Date: 28‑05‑2020

Source: The Wall Street Journal By Michael Kratsios

The G‑7 launches a new global partnership Thursday.

The U.S. is using every tool at its disposal to defeat the novel coronavirus, including artificial intelligence. American laboratories are harnessing AI to discover new therapeutics. The Food and Drug Administration approved an AI tool to help detect coronavirus in CT scans. And the White House led an initiative to create a database with more than 128,000 articles that scientists can analyze using AI to help understand the virus better and develop treatments.

At the same time, AI is being twisted by authoritarian regimes to violate rights. The Chinese Communist Party is reportedly using AI to uncover and punish those who criticize the regime’s pandemic response and to institute a type of coronavirus social‑credit score—assigning people color codes to determine who is free to go out and who will be forced into quarantine.

As the world begins to recover from the pandemic, nations face a stark choice about what vision of artificial intelligence will prevail. As Group of Seven nations meet this year under the organization’s U.S. presidency, there is a critical opportunity to shape the evolution of AI in a way that respects fundamental rights and upholds our shared values. That is why G‑7 technology ministers will agree Thursday to launch the Global Partnership on Artificial Intelligence, or GPAI, together with other democratic countries. Den Rest des Beitrags lesen »

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China Rules Out Animal Market and Lab as Coronavirus Origin

Posted by hkarner - 28. Mai 2020

Date: 27‑05‑2020

Source: The Wall Street Journal

Comments by Chinese scientists aim to counter what Beijing perceives as efforts from top U.S. officials to focus solely on China’s role in pandemic

China’s top epidemiologist said testing of samples from the Wuhan food market, seen on Jan. 24, failed to show links between animals being sold there and the coronavirus.

Chinese scientists in recent days said they had ruled out both a laboratory and an animal market in the city of Wuhan as possible origins of the coronavirus pandemic, in their most detailed pushback to date against allegations from U.S. officials and others over what might have sparked it.

The director of the Wuhan Institute of Virology, at the center of allegations around a potential laboratory accident, Wang Yanyi, over the weekend told China Central Television that the coronavirus was significantly different from any live pathogen that has been studied at the institute and that there therefore was no chance it could have leaked from there. Den Rest des Beitrags lesen »

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