After not blogging for years, I plan to resume, at least for now, since I have received several requests and questions about the outlook for the economy as a result of the Covid-19 pandemic.
I have to begin with something that I have started to share with others. I'm not a fan of the 21st century 😏. Early on, there was September 11, a story that your children and grandchildren will be reading about. Then, there was the Financial Crisis of 2007-2009, another one for the history books. However, in some ways, this current situation tops them all - a global pandemic that is shutting down large segments of the global economy and impacting daily lives all over the world like nothing we have seen (or fathomed). Where to begin?
For me, the enormity of the potential economic impact began on February 28 when I read that the Chinese Purchasing Managers Index plummeted, it's largest drop on record (a leading indicator of the Chinese economy). Around that same time, there were reports of pollution in China improving significantly due to a severe reduction in economic activity. The next event that stands out was northern Italy being shut down as the pandemic took hold (even schools were closing). For many, I think it was still abstract and unimaginable that it could become more than a few isolated events elsewhere in the world (and some even doubted that it was real). A week later and a new reality set in as the US and much of the rest of the world began to shut down to reduce community contagion. What an incredible few weeks (yes, your kids and grandchildren will be reading about this). Since this is a blog about the economy, it's time to think through the economic impact. But first, I need to develop lessons plans for my sons for today and think about how to have them stay in touch with friends (one declined coming over until after the end of the pandemic. I do have some time since Publix is opening later in order to restock and disinfect the store (we're running low on milk and they did not have any yesterday). I'll begin discussing what's going on in the economy in the coming days.
