Economic Free Fall

The current pandemic has led to an economic free fall which is unparalleled in history. In the US alone, the unemployment rate plummeted at such a speed that more than 10 million have claimed unemployment insurance in a matter of three weeks.

With over 30 percent of the U.S. population expected to be unemployed by this summer, and the GDP shrinking at a faster rate that the Great Depression of the 1930s, the current situation is uncharted territory, even for the experts.

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The Pandemic Lockdown in the U.S. directly affects the livelihood of a shocking 80% of American workers who work in retail, real estate, education, entertainment and restaurants.
Many of these offices and stores are not going to open after that.

  • In Europe, The north of Italy, which is the main tourist hub, is seeing a collapse in economic activity, along with Germany, which is falling at a steeper rate than the United States. Even countries like Japan, which are not hit that hard, are about to witness an apocalyptic fall.
  • In India, with the abrupt 21 days shutdown, which was recently extended by another 19 days, only a small percentage of the 1.3 billion population is covered by any social security, and millions of daily wage or migrant workers, have no hope, future or place to stay.

Countries are opening up their purse strings and providing stimulus packages and concessions to boost the economy, but these measures will show results after months and may not be enough.

Falling consumption has resulted in 70 percent of Americans losing their income in March, and for many that loss can lead to long-term hardship and suffering.

There is an 88 percent decrease in petrol consumption in Europe, and automobiles sales are now zero.

The World In Lockdown

A long period of Lockdown can lead to deep scarring of the economy with a slow recovery, but as there is a risk of a second wave of infections once this dies down, these movement restrictions will need to stay in place.

Many banks are in effect printing money, something that is unprecedented and points towards the extremity of the problem. These measures will lead to complications and politics sooner rather than later.

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