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 We Think the Recovery Will Be U-shaped (Schroders, 6 min read) The difficulty in lifting lockdowns (danger of a second wave of infection), cautious consumption (especially in travel, hospitality and leisure sectors), a rollback in government support and falling capex (mainly to prioritize debt reduction) will all weigh on global growth. Pre-COVID levels of activity will only be seen by end 2021. [Bearish Global Growth]
Robotic Labour: The Automation Channel of Pandemic-Induced Uncertainty (VoxEu, 8 min read) Sylvain Leduc finds that COVID-19 uncertainty could stimulate more investment in automation despite lower aggregate demand. The net effect of automation can in fact boost employment. [Bullish Smart Manufacturing]
The US Consumer Is Bowed, Not Broken(BlackRock, 4 min read) First, transfer payments in April cushioned personal income. Second, the consumer came into the pandemic in better shape than the previous financial crisis: high wealth levels, low debt, and debt servicing cost at multi-decade lows. Finally, housing, the largest asset for most families, is also holding value well. All of this will support consumption and, consequently, growth. [Bullish US Consumption]