This article is only available to Macro Hive subscribers. Sign-up to receive world-class macro analysis with a daily curated newsletter, podcast, original content from award-winning researchers, cross market strategy, equity insights, trade ideas, crypto flow frameworks, academic paper summaries, explanation and analysis of market-moving events, community investor chat room, and more.
Why Odds of a Coronavirus Recession Have Risen (The Harvard Gazette, 10 min read) Jeremy Frankel discusses his February (and at the time early) call for a rising likelihood of global recession. Lack of fiscal space in the US won’t help and the economy is likely to face parallels with the financial crisis and the 2001 terrorist attacks.
The Coronavirus and the Great Influenza Epidemic: Lessons from the “Spanish Flu” for the Coronavirus’ Potential Effects on Mortality and Economic Activity (American Enterprise Institute, 25 page read) A worst case scenario for COVID-19 based on the Spanish flu of 1918-1920 could mean some 2% of world population, or 150mn people, may lose their lives, economic contraction of around 6% and real returns on assets falling sharply.
The Coronavirus World Recession (George Magnus, 4 min read) The current economic contraction is a four-fold hit from; a wealth effect from the stock market declines, a demand shock from the quarantine measures, a supply shock from the inability to work and exacerbated credit and default risk. Fiscal support will help but may not be fully able to support spending and borrowing until confidence in public health systems return.