Economic recovery

People saying the economy will bounce back have become a bit quieter. I still think we are in for a 30% contraction - possibly even 40% or more.

Everything is largely ok now because the furlough scheme is the rug.

Once the rug is pulled, it’s over. As someone else said, plenty of credit defaults on car loans and leases, credit cards and all the other junk you can buy on tick nowadays.

I simply cannot see the firms I know who have furloughed people taking those employees back after this is over.

What the government seem to think is that a tap will be turned and demand will come flooding back... not going to happen.

It’s going to take years to get back to pre-COVID levels of demand and economic activity. Another reason why lots of those people being furloughed will never be able to go back to the jobs they’ve been furloughed from.

I think the meltdown itself will claim a few big banks, and I think the depression will last a very long time. With talks of increased taxes already it’s hard to see how we get things going again.

 

There's certainly potentially bleak times ahead for a time. It does make me wonder if a second lockdown will ever happen, even if things get grim, because the economic cost and impact may take centre stage. It's going to be difficult enough to convince those aged 65+ to engage with the economy as it is, because many will understandably be keeping a low profile for the foreseeable.

 

We are all in a lifeboat,. there are various personallities in the boat.
Some believe in self preservation,others would actually sacrifice their own life to save others, some believe in hopelessness while others believe in hope and a possitive outcome. Someone relentlessly talks of why the Ship sank and who's fault it was and how it could have been avoided. All the time sitting quietly, a lawyer is listening to everyones views to prepare his case to sue whoever he can if ever he is fortunate enough to be delivered home by the others and good fortune.

 

Its said that America the worlds biggest economy fears primarily ever having to fight two major wars on two fronts simultaneously. It's never happened and they don't even model war on 3 fronts.

UK faces Pandemic economic meltdown, Brexit, Trade Talks simultaneously. Now the worlds richest and profitable businesses want to stay afloat by setting up their staff at home. Effectively removing them from normal society. Removing them from the journey in, the journey home, the restaurants, cafes, bars, in-town high streets and retail parks. Their cars won't break down or need replacing as often cos when will they get used? They'll need less holidays cos well they won't be so stressed going into town will they? They won't need to wine and dine as much cos they got no kudos gain from doing so anymore. They won't need as many clothes, or shoes.

Now imagine in another realm there was a digital Corona Virus, right in Acorn. And all the best domainers, the most successful and knowledgeable domainers all disappeared into the Premium Lounge where they and their families were safe. Popping out now and again but only ever briefly, leaving the rest of us domainers in the normal threads with digital Corona all over the place and an acorn economy struggling for oxygen?

You put the rest, the majority, where they can have all the crap but none of the upward role models driving normal folk to greater personal aspiration that leads to growth.

Probably haven't explained that as eloquently as some could but that to me is the danger of Work from Home. Ramifications across the entire economy could mean UK ends up battling economically on 4 fronts simultaneously.

Yet what is known now is that Employees of the Banks, Tech firms, major firms, digital sme's have all said yaaaay to Working From Home and most if reports are to be believed wish to do so permanently and with that UK can kiss goodbye to the UK highstreet, possibly spectator sport, and quite a few other things. The medicine ends up killing the patient as you strangle off the last bastions of social mobility and trickle-down economics.

 

Dr Bright - Live COVID.

 

So if we really care about others, lets all wear face covering in places where we can't social distance.

 

Print more money.

Mobilise with Europe (and the US if they choose to) to award each state huge amounts of money to balance out recent borrowings, and also kick-start domestic economy by converting furlough-type spending into a final round of expenditure (paid for by part of the QE) to give each household £5000 (or more) to start spending.

Sure - arguments about inflation, but if EU and UK all did the same, then the big trade between them would be pretty much viable - and in answer to 'donton', it would be a way to "get things going again".

Beyond that, if necessary, renege on the loans from the huge Wealth Funds we've borrowed from, in tandem with other nations - and re-distribute money in the interests of the majority. But only as a late resort.

Redistribution of wealth is a political choice, as is not doing so. Laissez-faire neoliberalism is a system set up primarily to benefit those who have already, to protect their interests. It's not an inevitability. 'Commonweal' should be a moral imperative, and the absolute priorities coming out of this crisis should be: household viability and spending power, affordable housing mass construction programme, proper decent care of the elderly, expanded health resources, youth opportunity - and as a nurse working in the NHS I'm going to ask (but it can be generalised far wider):

Why is it right that nurses average pay is less than £30,000 (starting salary just over £25000) yet lawyers and accountants average over £60,000, and MPs over £80,000 (not to mention allowances)?

It's not just nurses, it's so many people. Everything's run for the 'professional' classes. Nurses are not really classified as professionals. Probably neither are some of you.

We need to get money channelled to ordinary families, rewarding effort not status, because if these millions of ordinary people have zero spending power, then we will accentuate recession/depression, and cause deeper social harm and the further hollowing out of our society. If we learn anything from this virus, it should be that 'community' really matters, and thinking of others, and caring for the most vulnerable. Working together in everyone's interests.

This isn't Marxism. It's believing in community and more fairness for everyone, and letting these decent ideals inform political choices.

Don't hold your breath, but don't just take glib political PR at face value, when people say it's not possible. Not easy, perhaps. But it's not automatic that we have to just take another 10 years of deep austerity, while the small minority protect or expand their status, wealth and power.

 

Oh siusaidh, lets keep the thread non political. If anyone gives their opinion on your politics it will take the lid off the can of worms which has been put to bed at the ballot box for the next few years at least. People have been trying to re model economics for centuries and now probably isn't the time to debate it. Lets all love each other care for each other and overcome the challenge by controlling the virus. This should be a road to damascus time to some degree for all of us

 

Covid has unearthed a plethora of problems that most folk didn’t appreciate the gravity of. My two cents in a very shortened way as I’m typing on my phone is that it needs to run its course now, we’re too far gone to stop it.

1. Response - too slow to contain or reel in, it’ll never stop spreading when there’s a lack of testing or ppe and folk are doing the conga on a Thursday night at 8pm. Supermarkets are social distancing outside but inside it’s a free for all.

We’re too polite and “British” to enforce a shutdown which has cost lives, example “only go out for food or medicine” yet The Range and B&Q are open and not a thing has been done about it.

2. Masks for public - not enough, not face fit tested, lack of hygiene understanding (touching masks then pressing the bell on the bus or re-using the same mask).

If you think that’s not the Government’s fault I’m one of many people who offered it to them (free and at cost). No less than 3 times I had the same email with 21 questions. I replied and heard nothing so ended up distributing it myself (www.wegotyou.uk)

3. Economy - we’re already in over a trillion £ of debt, it’s going to get worse. All these government payments are like giving someone credit card after credit card...it’ll need to be paid back with interest.

And it’s not done fairly. Most micro businesses (1-10 employees) don’t qualify for aid beyond furlough (which took 5 weeks) as they don’t have a premises with business rates.

To help without impacting our economy we could stop foreign aid, close tax loopholes, scrap trident. As much as I believe in helping businesses who create employment and investment in our country if you make money here you pay tax, end of.

To give you an idea the furlough scheme is costing £12-16bn a month according to a few articles, £15bn in grants and £10bn in help for the self employed.

Assume 2 months of furlough at £14bn and we’re totalling £63bn.

Foreign aid is estimated to be £14bn a year so 5 years of no help covers it.

Trident is £205bn, enough said.

I’m not politically motivated and figures may not be 100% accurate but you get my drift.

As for the NHS and pay - don’t do it if the pay is shit. And if you’re treated like shit (E.g no PPE) then strike. The government is abusing the placid nature of the people.

 

Again in short as I’m on my phone...

1. Processes and policies have cost lives. Sure check they’re CE marked etc but if you’re asking staff to work in such dangerous conditions and someone is offering you something for free take it, especially when you say there’s a shortage.

And that argument goes out the window when you’re sending out ppe that has expired use by dates on them.

Forget me as an individual. Primark were ignored. Barbour ended up donating direct.


2. What help? What is available aside from loans or industry specific grants like tourism? To my knowledge there’s nothing as simple as the £10,000 premises grant.


3. I don’t mind paying tax if we have a good community system. We already pay more tax in Scotland but have free education, free prescriptions and are talk about a basic income for all. I’m not saying it’s better but if it’s justified then so be it.

What I hate doing is paying tax when there are so many avoiding it or our beloved Government gets another pay rise.

 

200,000 cases daily in London at the end of March.
now down to 24 . Hope there is some accuracy in that research if there is then that's a sign for hope in the future though not for the past I accept.

 

1) So a good example would be safety glasses. I sent them to places who had none or not enough. They were bought in the UK from UK manufacturers with the appropriate markings/certificates.


Many places are currently accepting face shields made in people’s homes using 3d printers. Without sounding arrogant or rude I’d argue my solution was safer.


There’s countless deaths due to a lack of PPE it would be a pit hypocritical for the government to come after one person after they’ve failed so many. There’s also the Good Samaritan Act to consider.


2. Yes free, it’s unfair to offer free support to a selection of businesses without reasonable explanation.


3. Agreed. People moan about Richard Branson asking for a Government loan or living in a tax haven without considering how many people he employs, how much money his efforts have contributed to the economy etc.


They’re quick to crucify him and others when they’ve played a key role in advancing our economy, yet they still bank with the same institution the government bailed out not so long ago.


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I’m probably more direct with my thoughts and ideas but that’s because I feel all we do is moan and complain and do “policy reviews” or “independent inquiries”. There’s no accountability which is why even a response to a virus we saw coming from a mile away was disaster. There will be a scapegoat here and there, oh and don’t forget a £60,000 payment if your dead.

 

I agree that London will very likely see the biggest crash in the property market, but not for that reason.
The shift is going to come from many more employees having to adapt to working from home & it seems very likely that trend will be a permanant arrangement for many companies going forward in the months/years ahead. There will be too many barriers to commute safely & big savings to be seen in getting rid of property leases.
A lot of people will continue to work from home & look at moving away from cities in general. So, property values elsewhere may not see such large drops in value, at least mid-term I think.

The Government is printing money on a massive scale (QE). with Business Grants & on an even larger scale Business Loans (bounce back loan scheme) which are open to practically any man & his dog who wants it.
The main aim here is to ensure that the cash goes directly as possible to businesses this time instead of the Banks hoarding it as they did following 2008.
These are in effect just grants as far as budgeting goes for the Government with the added bonus of at least having some return in the future (many of course will not get paid back).

In the months ahead when we plummet into recession. A BIG Recession!!
A big part of the challenge will be to get businesses to Spend as much of that cash as possible and get it moving through the economy as quickly as possible, in the hope of a sharp bounce back.
So, the answer to that could well be Negative Interest Rates IMO.
It would make perfect sense for the BOE to take this strategy as it would discourage too many businesses from hoarding the cash (if they do, they will of course then be charged for it).

I could well be wrong, but I think there would at least be some sense to this approach, so wouldn't be too surprised if we see this happen.
I guess we will find out..

 

It's time for everybody to get back to work wearing masks. Come on now, the economic fall out has to be taken more seriously than the danger of young healthy people wearing masks dying of the virus. I think social distancing should be left to common sense if people are by law required to wear masks in confined spaces. Queuing outside shops in the future is ludicrous so time to wear masks and get back to work.

 

Are you serious, If supply was the problem there would be no problem. It's the desire to do it that is missing. I can see everyone's point of view but this economic meltdown is simply not a solution.

 

Try it Steve. You don't know what you're missing

 

'Major reallocation shock' from coronavirus will see 42% of lost jobs evaporate - https://finance.yahoo.com/news/majo...-see-42-of-lost-jobs-evaporate-172558520.html

 

Hertz have filed for bankrupty

Didn't take much time did it