how lousy will the COVID-19 recession be?
The real question is perhaps maybe not whether you will see a recession, but exactly just exactly how deep and just how long – and whether investors look set to be relieved or disappointed.
As COVID-19 continues to distribute, issue has quickly shifted from whether you will see a international recession to how dreadful the recession will likely be. Could it be deep but quick? Or deep and extended? As investors, the question that is next have to ask ourselves is exactly what could be the market priced for. And certainly will it is relieved, or disappointed?
The severity of the downturn will likely depend on three factors: the time it takes for the disease to be contained, the pre-existing vulnerabilities in the global economy, and the global policy response in our view.
The most difficult of the to analyse confidently is the length of time it will require when it comes to virus become included and also for the importance of travel restrictions and social distancing to reduce. (more…)