WP: "economic decline will be sharper and more painful than during the 2008 financial crisis"

[honest.abe]

From the Washington Post..

The U.S. economy is deteriorating more quickly than was expected just days ago as extraordinary measures designed to curb the coronavirus keep 84 million Americans penned in their homes and cause the near-total shutdown of most businesses.

In a single 24-hour period, governors of three of the largest states — California, New York and Illinois — ordered residents to stay home except to buy food and medicine, while the governor of Pennsylvania ordered the closure of nonessential businesses. Across the globe, health officials are struggling to cope with the growing number of patients, with the World Health Organization noting that while it required three months to reach 100,000 cases, it took only 12 days to hit another 100,000.

The resulting economic meltdown, which is sending several million workers streaming into the unemployment line, is outpacing the federal government’s efforts to respond. As the Senate on Friday raced to complete work on a financial rescue package, the White House and key lawmakers were dramatically expanding its scope, pushing the legislation far beyond the original $1 trillion price tag.

With each day, an unprecedented stoppage gathers force as restaurants, movie theaters, sports arenas and offices close to shield themselves from the disease. Already, it is clear that the initial economic decline will be sharper and more painful than during the 2008 financial crisis.

https://www.washingtonpost.com/business/2020/03/20/us-economy-deteriorating-faster-than-anticipated-80-million-americans-forced-stay-home/

It starting to feel like the cure might be worse than the disease. Seems like we lose no matter what.

I think our leadership needs to assemble the smartest people in the country (from both sides of the isle) to figure out how best to deal with this extraordinary situation. If this isnt handled correctly we could be headed for disaster. I hope Joe Biden will take the lead on this since the Idiot in the WH is hopeless.

NOTE: This article is behind WP paywall. I was able to access using incognito mode in Chrome.

[beachbumbob]

1. DUH

2008 and today's crisis share nothing in common for root cause and effect. A financial driven crisis and a pandemic driven crisis have to be address differently and this is the failure of trump and jos admin

[honest.abe]

2. Exactly. The Trump administration is flailing around and have no clue what to do.

Which makes this situation much much worse.

[beachbumbob]

3. look at Italy, multiply the numbers by a factor of 10-20x...perhaps higher, thats where its going

[honest.abe]

4. More from the article ..

Next week, the Labor Department will likely report that roughly 3 million Americans have filed first-time claims for unemployment assistance, more than four times the record high set in the depths of the 1982 recession, according to Bank of America Merrill Lynch. That is just the start of a surge that could send the jobless rate spiking to 20 percent from today’s 3.5 percent, a JPMorgan Chase economist told clients on a conference call Friday.

Estimates of the pandemic’s overall cost are staggering. Bridgewater Associates, a hedge fund manager, says the economy will shrink over the next three months at an annual rate of 30 percent. Goldman Sachs pegs the drop at 24 percent. JPMorgan Chase says 14 percent.

“We are looking at something quite grave,” said economist Janet L. Yellen, the former Federal Reserve chair. “If businesses suffer such serious losses and are forced to fire workers and have their firms go into bankruptcy, it may not be easy to pull out of that.”

[duforsure]

5. If trump and McConnell fail to adequately provide stimulus

Directly to the people and much higher we'll be hearing we're heading into a depression from their failure. Trump is trying to stiff us , and lying claiming he isn't. Trumps dragging his feet on everything still, and ask, is he purposely trying to cause us to go into a depression? For Putin? And the downturn will last a lot longer from trump pressuring fed Powell to lower rates, when he wanted to raise them but trump threaten to fire him if he did.

[Firestorm49]

6. Taking on an additional trillion dollar debt could possibly mean a long term recession....

after the virus is gone, as we don’t have the money. All I’m saying is that we may be paying a price for this long after the virus has subsided. We must throw all that we can at solving this crisis.

It would have been wise to have had a tax plan that built the coffers during good times (raise the taxes on the 1%) in order to have revenue to rely on in times like this, since once the virus is gone, the debt will be staggering. But, the deficit hawks have nullified that premise, so, .......