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Reader Comment from March 9th

Summary:
Bruce Hall, on Stephen Moore’s “roaring back” comment, about a month ago: The situation is a prepper’s dream: market dropping with prices probably following as competition for any sales heats up, assets in gold and cash, a big stock of freeze-dried food, and a self-contained dwelling. But realistically, once the real scope of the problem is understood and amelioration actions are effected, things will begin to normalize. That may be six weeks or six months, but Moore is probably right although “roaring” may be overstating the case. The economy did not “roar” back to life after the last major downturn. There may be significant re-thinking about supply chains and markets because of the vulnerabilities exposed by Covid 19. You know … eggs in one basket …. Wow, oil below around midnight,

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Bruce Hall, on Stephen Moore’s “roaring back” comment, about a month ago:

The situation is a prepper’s dream: market dropping with prices probably following as competition for any sales heats up, assets in gold and cash, a big stock of freeze-dried food, and a self-contained dwelling.

But realistically, once the real scope of the problem is understood and amelioration actions are effected, things will begin to normalize. That may be six weeks or six months, but Moore is probably right although “roaring” may be overstating the case. The economy did not “roar” back to life after the last major downturn. There may be significant re-thinking about supply chains and markets because of the vulnerabilities exposed by Covid 19. You know … eggs in one basket ….

Wow, oil below $30 around midnight, but recovered to $34. Well, that will make that summer road trip that won’t happen less expensive.

My personal opinion (yes, opinion) is that this crisis is somewhat overblown and will fall into the Ebola, SARS, MERS, sky-is-falling category once more facts and protocols are in place. But fear is a powerful de-motivator.

I think we can now safely say the the crisis was not “overblown”. Deutsche Bank’s March 30th forecast for the US, shows a persistent hit to the level of GDP.

Reader Comment from March 9th

Source: Deutsche Bank, 3/30/2020.

Reader Comment from March 9th

Source: Goldman Sachs, 3/31/2020.

Menzie Chinn
He is Professor of Public Affairs and Economics at the University of Wisconsin, Madison

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