Coronavirus shook the foundations of a global stock market powered by debt
4 years, 10 months ago

Coronavirus shook the foundations of a global stock market powered by debt

ABC  

The news over the weekend was nothing short of grim. While western governments are sheeting home the blame for last week's market carnage on the virus, a much more sinister and barely concealed problem lurks at the heart of our financial system. Last October the International Monetary Fund warned that up to $US19 trillion of corporate debt could be "at risk" if there was a sudden downturn even half as severe as the 2008 global financial crisis. Clearly, ultra-low interest rates have been a major factor in fuelling the boom on global stock markets, but rate cuts and financial stimulus are the only weapons at the disposal of central banks. As Wall Street endured yet another tumultuous trading session on Friday, US Federal Reserve boss Jerome Powell tried to soothe investor nerves with reassurances that "we will act as appropriate to support the economy".

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History of this topic

Why global financial markets are walking a tightrope
1 year, 2 months ago

Why global financial markets are walking a tightrope

ABC  

If the past few months are anything to go by, the era of dependable double digit super returns may be drawing to a close. Longer term, they have upended trading patterns and drawn the curtain on almost three decades of global trade liberalisation, ushering in a new Cold War that's threatening to turn hot. That's left money managers dazed and …

Impending economic crisis will dwarf coronavirus crisis, says credit insurer Allianz
2 years, 2 months ago

Impending economic crisis will dwarf coronavirus crisis, says credit insurer Allianz

NL Times  

The looming economic crisis will make the coronavirus crisis look like nothing, according to credit insurer Allianz Trade. Rarely have so many negative facts come together simultaneously,” Johan Geeroms, director of risk underwriting in the Benelux for Allianz, said in a press statement. And, partly due to the 10 percent increase in the minimum wage the government announced for next …

Global economic bailout is running at $19.5 trillion. It will go higher
4 years, 1 month ago

Global economic bailout is running at $19.5 trillion. It will go higher

CNN  

London CNN Business — Governments and central banks have promised to shell out $19.5 trillion since the coronavirus erupted to “put a floor under the world economy,” according to the International Monetary Fund. While coronavirus vaccine candidates point to improved prospects for the global economy next year, they won’t help countries much in the immediate future. In the United States, …

Government borrowing has hit £208billion in six months of coronavirus crisis
4 years, 2 months ago

Government borrowing has hit £208billion in six months of coronavirus crisis

Daily Mail  

The government has borrowed more than £208billion over six months to manage the crippling economic effects of the coronavirus crisis. National debt hit £2.06trillion at the end of last month, equivalent to 103.5 per cent of the size of the whole economy. There have been predictions that the situation will get even tougher as millions face unemployment as the economy …

Government borrows more than a billion pounds PER DAY during coronavirus crisis
4 years, 2 months ago

Government borrows more than a billion pounds PER DAY during coronavirus crisis

Daily Mail  

The crippling impact of coronavirus on the public finances was laid bare today after new figures showed the government borrowed more than £208billion over six months. Another £36.1billion was borrowed in September - the third-highest month on record and compared to just £7billion a year ago - as tax revenues slumped and the Treasury poured out bailout money. Another £36.1billion …

Stocks week ahead: The economic recovery hangs in the balance as winter approaches
4 years, 3 months ago

Stocks week ahead: The economic recovery hangs in the balance as winter approaches

CNN  

A version of this story first appeared in CNN Business’ Before the Bell newsletter. The UK government isn’t ruling out another national lockdown, though the health secretary has said it would be “the last line of defense.” Such measures would be the worst-case scenario for economies experiencing a historic expansion following a record contraction. Just take it from Federal Reserve …

World economy: What else could go wrong before 2020 is done
4 years, 4 months ago

World economy: What else could go wrong before 2020 is done

Live Mint  

The world economy’s rebound from the depths of the coronavirus crisis is fading, setting up an uncertain finish to the year. Adding 1.4 million jobs in August was “a big step in the right direction,” said Ryan Sweet, head of monetary policy research at Moody’s Analytics. But the economy needs to maintain that kind of pace, he said, and “without …

US debt is exploding because of the coronavirus. Is it near a breaking point?
4 years, 8 months ago

US debt is exploding because of the coronavirus. Is it near a breaking point?

CNN  

New York CNN Business — President Donald Trump is living up to his self-given nickname “King of Debt.” On his watch, the United States has borrowed aggressively – during the good times, and now the bad times. “It doesn’t blow us up – because interest rates are so low,” said David Kelly, chief global strategist at JPMorgan Funds. “If the …

Coronavirus recovery is just around the corner — if the stock market can be believed
4 years, 8 months ago

Coronavirus recovery is just around the corner — if the stock market can be believed

ABC  

No-one has a crystal ball. The experts don't always get it right, but the main Australian stock market index right now is much higher than it was back in March, when the shock of coronavirus hit households across the country. However, when you consider the Centrelink queues, Treasury's forecast of an unemployment rate reaching 10 per cent, talk of Depression-like …

Can the US economy recover from coronavirus?
4 years, 8 months ago

Can the US economy recover from coronavirus?

Al Jazeera  

As the pandemic spreads in the US, the country’s economy is likely to face its worst crisis since the Great Depression. It shrank by almost 5 percent in the first quarter of this year – the biggest slide since the 2008 financial crisis. As many businesses are going bankrupt, the US has pumped more than $2 trillion into the economy …

Coronavirus relief pushing US deficits to staggering heights
4 years, 8 months ago

Coronavirus relief pushing US deficits to staggering heights

Associated Press  

WASHINGTON — Spend what it takes, Washington said as it confronted the coronavirus. CBO Director Phillip Swagel cautioned that there is “enormous uncertainty” to the projections, given the unprecedented nature of the crisis, but it’s plain the economic shock is unlike anything seen since the Great Depression. Even Washington’s few remaining spending hawks say red ink should not be a …

Is capitalism dying or just in isolation during the coronavirus pandemic?
4 years, 9 months ago

Is capitalism dying or just in isolation during the coronavirus pandemic?

ABC  

Home Affairs Minister Peter Dutton was one of the first to cross the line. They've preached privatisation, asset recycling and the fundamental belief that free trade and minimal government intervention will maximise wealth and lift society as a whole. A week after Mr Dutton's outburst, Treasurer Josh Frydenberg announced stricter rules would be placed around foreign investment in a bid …

After coronavirus passes, nothing will be the same — and that might not be a bad thing
4 years, 9 months ago

After coronavirus passes, nothing will be the same — and that might not be a bad thing

ABC  

The daily shockwaves hitting us in the time of the coronavirus can mean the extraordinary nature of individual changes can be lost. Never was this more true than this week when the Morrison Government announced, first, an extraordinary $130 billion wage subsidy, then, a few days later, free childcare. The extent to which the economic crisis — and the necessary …

Why stocks have further to fall amid the coronavirus pandemic
4 years, 9 months ago

Why stocks have further to fall amid the coronavirus pandemic

ABC  

If ever you needed convincing that financial markets have become completely divorced from reality, just look at the events of last week. The performance, based on the hope that central banks and government stimulus would insulate financial markets from a global economic downturn, was more BS than bull. The wild ride on global markets last week, following a month of …

What to make of the US’s $2 trillion coronavirus bailout
4 years, 9 months ago

What to make of the US’s $2 trillion coronavirus bailout

Al Jazeera  

In spite of the negatives and the risks, the stimulus package represents a real political and philosophical change. On Wednesday, the United States Senate overwhelmingly approved a $2 trillion rescue bill to address the effects of the coronavirus pandemic on the economy. When he was asked who would watch where the money went, Trump said, “I’ll be the oversight.” The …

Global economy continues to slide as coronavirus outbreak worsens; uncertainty to remain for several months: Moody's
4 years, 9 months ago

Global economy continues to slide as coronavirus outbreak worsens; uncertainty to remain for several months: Moody's

Firstpost  

A sharp contraction of the global economy, at least in the second quarter, appears imminent, it said in its latest special series ‘Credit Risks in Turbulent Times.’ The rapid spread of the coronavirus in the last two weeks, widespread business closures and unprecedented restrictions on social interactions will result in a permanent hit to global economic activity this year, according …

Coronavirus deals a death blow to U.S. economic expansion
4 years, 9 months ago

Coronavirus deals a death blow to U.S. economic expansion

The Hindu  

No one knows how long it will last or how much it will hurt. But the U.S. economy is either sliding into a recession for the first time since 2009 or is already in one — a sudden victim of the coronavirus outbreak. The vast changes deemed necessary to defeat the virus — people and companies no longer engaging with …

How much damage could coronavirus ultimately cause? The share market has some answers
4 years, 9 months ago

How much damage could coronavirus ultimately cause? The share market has some answers

ABC  

Something extraordinary happened this week. What the market is saying about the Australian economy From peak to trough, the All Ordinaries Index and the ASX200 have fallen roughly 25-30 per cent. Each day, it's entirely possible we will see market moves anywhere between 3 and 10 per cent — depending on the news flow. Tuesday's market resurgence is a classic …

Global recession is here, according to S&P
4 years, 9 months ago

Global recession is here, according to S&P

CNN  

New York CNN Business — The coronavirus outbreak has plunged the world’s economy into a global recession, according to S&P Global. “The initial data from China suggests that its economy was hit far harder than projected, though a tentative stabilization has begun,” said S&P Global’s Chief Economist Paul Gruenwald. “Europe and the United States are following a similar path, as …

Coronavirus Bailouts Aren't The Problem: Corporations Are
4 years, 9 months ago

Coronavirus Bailouts Aren't The Problem: Corporations Are

Huff Post  

A trader reacts as he works on the floor of the New York Stock Exchange in New York City on March 11, 2020. This simple task has already proved too arduous for President Donald Trump and House Majority Leader Nancy Pelosi, whose first effort at a paid sick leave bill can only be described as pathetic, providing only partial sick …

Coronavirus jolts global stock markets
4 years, 9 months ago

Coronavirus jolts global stock markets

Deccan Chronicle  

LONDON: The coronavirus panic is jolting stock markets, with steep drops in major indexes grabbing the public’s attention. This sudden flight to safety is causing havoc in markets for bonds, currency and loans to a degree that hasn’t been seen since the financial crisis of a dozen years ago. Francesco Papadia, who oversaw the European Central Bank’s market operations during …

Coronavirus devastates China’s economy and the ‘nightmare’ is not over
4 years, 9 months ago

Coronavirus devastates China’s economy and the ‘nightmare’ is not over

CNN  

Hong Kong CNN Business — China’s economy was devastated by the novel coronavirus outbreak in the first two months of the year, according to data published Monday, and analysts say the nightmare is far from over. Larry Hu, chief China economist for Macquarie Group, said his “best guess” is that China’s $14 trillion economy will contract by 6% in the …

Economic paralysis: Coronavirus slams brakes on China economy
4 years, 9 months ago

Economic paralysis: Coronavirus slams brakes on China economy

Al Jazeera  

Everyone knew the coronavirus outbreak was hurting China’s economy. Urban investment and retail sales also fell sharply for the first time on record, reinforcing views that the epidemic may have cut China’s economic growth in half in the first quarter. Industrial output fell by a much worse-than-expected 13.5 percent in January-February from the same period a year earlier, the weakest …

The global coronavirus recession is beginning
4 years, 9 months ago

The global coronavirus recession is beginning

CNN  

London CNN Business — As restaurants, shops, airlines and factories shutdown around the world, from New York to Paris and Madrid, economists are warning that a global recession is no longer a looming threat. “Whereas 10 days ago there was some legitimate uncertainty about whether the global economy was in the process of going into recession — 10 days later, …

Here’s what could really sink the global economy: $19 trillion in risky corporate debt
4 years, 9 months ago

Here’s what could really sink the global economy: $19 trillion in risky corporate debt

CNN  

London CNN Business — Companies have spent the years since the global financial crisis binging on debt. “This certainly is another match being lit the bonfire of corporate debt liabilities,” said Simon MacAdam, global economist at Capital Economics. “There’s definitely potential for systemic risk.” The coronavirus shock Investors became increasingly anxious about corporate debt this week as stocks sold off …

As Covid-19 Spreads, Listen to the Stock Market—for Now
4 years, 9 months ago

As Covid-19 Spreads, Listen to the Stock Market—for Now

Wired  

Covid-19 was officially declared a pandemic Wednesday, and stocks officially entered a bear market, falling more than 20 percent from their peak just last month. Stock prices reflect expectations of future profits, and investors see the virus dampening economic activity and reducing profits. Apple a few weeks ago announced that it would not meet its forecasts for the current quarter …

Corporate debt loads a rising risk as coronavirus hits economy
4 years, 9 months ago

Corporate debt loads a rising risk as coronavirus hits economy

India TV News  

A gyrating stock market is seizing headlines as the coronavirus threatens corporate profits and economic growth. Oxford Economics has warned that nearly $4 trillion of U.S. corporate bonds will come due within five years — a “massive wall of maturities,” it calls it. “High debt levels make the corporate sector in key economies, including the U.S., particularly vulnerable to the …

How coronavirus and an oil war have pushed the stock market from boom to bust
4 years, 9 months ago

How coronavirus and an oil war have pushed the stock market from boom to bust

ABC  

It has been the longest winning streak in history. There have been a few blips along the way — the European debt crisis in 2012 and the Brexit vote gave Wall Street a dose of the wobbles and just 18 months ago, investors began unloading stocks as fears of a global slowdown followed a series of US interest rate hikes. …

Coronavirus could trigger global recession: Rabobank
4 years, 10 months ago

Coronavirus could trigger global recession: Rabobank

NL Times  

If the new coronavirus Covid-19 turns into a global pandemic, economists at Rabobank foresee an economic recession in large parts of the world, including the Netherlands, Germany, Japan, Italy, and the United States. "This economic crisis could become even worse if it turned into a financial crisis, for example when the number of bankruptcies increase sharply worldwide," the Rabobank economists …

Who will save the world from a coronavirus recession?
4 years, 10 months ago

Who will save the world from a coronavirus recession?

Al Jazeera  

Why a shock US central bank rate cut may not be enough to save the global economy from the coronavirus outbreak. Growth could halve this year to 1.5 percent, the OECD warned in its worst-case scenario for the outbreak, a growth rate generally considered to indicate a recession. Rajiv Biswaz, executive director and Asia-Pacific Chief Economist at IHS Markit, adds …

Coronavirus roils markets: this is why it matters to everyone
4 years, 10 months ago

Coronavirus roils markets: this is why it matters to everyone

Al Jazeera  

Even if you are not invested in stocks and bonds, how these markets behave shows what is at stake in the global economy. The 10-year US treasury yield – which on Friday tumbled below 0.7 percent for the first time ever – is a benchmark for setting rates on financial products such as home mortgages and student loans. The “R” …

How The Coronavirus Could Affect The Stock Market And Economy
4 years, 10 months ago

How The Coronavirus Could Affect The Stock Market And Economy

Huff Post  

LOADING ERROR LOADING The stock market took another major hit Monday as fears grow over how the coronavirus might wreak long-term economic havoc. “The Federal Open Market Committee has delivered monetary policy medicine investors were looking for to address concerns about the widening economic impacts related to the coronavirus outbreak,” said Mark Hamrick, senior economic analyst for Bankrate, in a …

Coronavirus pushes global economy toward 1st contraction since 2009
4 years, 10 months ago

Coronavirus pushes global economy toward 1st contraction since 2009

Live Mint  

Global economic growth will sink to levels not seen in over a decade as the coronavirus outbreak hammers demand and supply, challenging central banks and governments to respond to a fast-changing situation, according to the OECD. If the situation worsens, “co-ordinated policy actions across all the major economies would be needed” for health care and economic stimulus, it said. Things …

Global economy faces worst crisis since 2009 over coronavirus
4 years, 10 months ago

Global economy faces worst crisis since 2009 over coronavirus

CNN  

London CNN Business — The coronavirus is plunging the world economy into its worst downturn since the global financial crisis, according to the Organization for Economic Cooperation and Development, which warned Monday that growth could be cut in half if the outbreak continues to spread. Bank of Japan Governor Haruhiko Kuroda promised Monday that the country’s central bank would provide …

Viral economies: The Hindu Editorial on coronavirus impact on global economy
4 years, 10 months ago

Viral economies: The Hindu Editorial on coronavirus impact on global economy

The Hindu  

The global economy appears headed for uncharted, troubled territory thanks to the second wave of the coronavirus that has now spread to countries as far apart as Nigeria and New Zealand. The virus has crippled global supply chains, hit air travel and convulsed markets as it appears all set to adversely impact the U.S. economy, the global economic engine. A …

Coronavirus effect on world economy grows more alarming
4 years, 10 months ago

Coronavirus effect on world economy grows more alarming

India Today  

Concerns about the coronavirus outbreak's threat to the world economy grew Saturday, even after President Donald Trump denounced criticism of his response to the threat as a "hoax" cooked up by his political enemies. Trump accused Democrats of "politicizing" the coronavirus threat and boasted about preventive steps he's ordered in an attempt to keep the virus from spreading across the …

COVID-19 | Coronavirus infects global markets, investors exit equities
4 years, 10 months ago

COVID-19 | Coronavirus infects global markets, investors exit equities

The Hindu  

Global markets went into a tailspin on Friday as investors stampeded out of stocks and commodities and flocked to the relative safety of government bonds, prompted by fears of a global recession due to the spread of the coronavirus. After Wall Street experienced its worst rout since 2011 on Thursday, when the Dow Jones Industrial Average plunged by 1,190.95 points …

Coronavirus contagion spawns climate of panic on share markets
4 years, 10 months ago

Coronavirus contagion spawns climate of panic on share markets

ABC  

It's the word the world's top health authorities dare not utter. The coronavirus COVID-19, once contained in China's industrial heartland, has now spread to Europe and the Middle East, spawning a climate of panic that threatens to undermine not just financial markets, but the global economy. With so much debt issued at record-low interest rates, it has become almost impossible …

How the coronavirus could spark a severe slowdown or recession in America
4 years, 10 months ago

How the coronavirus could spark a severe slowdown or recession in America

CNN  

New York CNN Business — The longest economic expansion in American history has survived an unprecedented trade war, a catastrophic tsunami in Japan and a severe crash in oil prices. If the American consumer loses faith, and the coronavirus will be a real test of faith, then a recession is going to happen.” Mark Zandi, chief economist at Moody's Analytics …

Trump’s wishful thinking won’t stop coronavirus impact (Opinion)
4 years, 10 months ago

Trump’s wishful thinking won’t stop coronavirus impact (Opinion)

CNN  

Editor’s Note: Frida Ghitis, a former CNN producer and correspondent, is a world affairs columnist. CNN — President Donald Trump keeps telling us not to worry, that the fast-spreading COVID-19, the coronavirus, is “going to go away,” soon, probably by “April,” and that a vaccine is “close.” The experts, including federally-employed top scientists, say he’s wrong on all these counts. …

Virus outbreak chills markets, outlook for global economy
4 years, 10 months ago

Virus outbreak chills markets, outlook for global economy

Associated Press  

FRANKFURT, Germany — The widening coronavirus outbreak threatens to seriously disrupt the global economy, just as it was steadying itself against headwinds from the U.S.-China trade dispute. “Compounded with the already dramatic interruptions to global supply chains in China, traders fear that a rapid spread of the disease to other major economies could be enough to temporarily tip global economic …

The latest casualty of coronavirus: Asia’s biggest economies
4 years, 10 months ago

The latest casualty of coronavirus: Asia’s biggest economies

Live Mint  

Asia’s biggest economies are already feeling the brunt of the coronavirus shock. The warning signs come as finance chiefs from the world’s 20 biggest economies meet this weekend in Riyadh, Saudi Arabia for the first time since the virus outbreak. While early South Korea trade figures for February showed a pick up, an increased number of working days from a …

Coronavirus: Investors are betting on a quick recovery. What if they’re wrong?
4 years, 10 months ago

Coronavirus: Investors are betting on a quick recovery. What if they’re wrong?

CNN  

London CNN Business — A growing number of companies are warning that the coronavirus will prevent them from meeting sales or profit targets for the first three months of the year. There’s still time to contain the virus, Ghebreyesus cautioned, “but the window of opportunity is narrowing.” Coronavirus cases in South Korea, a major producer of the memory chips used …

Coronavirus poses risks to fragile recovery in global economy, says IMF
4 years, 10 months ago

Coronavirus poses risks to fragile recovery in global economy, says IMF

India Today  

The coronavirus epidemic has already disrupted economic growth in China and a further spread to other countries could derail a highly fragile projected recovery in the global economy in 2020, the International Monetary Fund warned on Wednesday. IMF Managing Director Kristalina Georgieva said the outbreak was a stark reminder of how unforeseen events could threaten a fragile recovery, and urged …

Coronavirus poses risks to global economy’s fragile recovery: IMF
4 years, 10 months ago

Coronavirus poses risks to global economy’s fragile recovery: IMF

Al Jazeera  

IMF says global economic recovery will be shallow and could be derailed by a further spread of the coronavirus. IMF Managing Director Kristalina Georgieva said the outbreak was a stark reminder of how unforeseen events could threaten a fragile recovery and urged G20 policymakers to work to reduce other uncertainties linked to trade, climate change, and inequality. Even in the …

Coronavirus: IMF chief sees ’mild’ virus impact on global economy
4 years, 10 months ago

Coronavirus: IMF chief sees ’mild’ virus impact on global economy

Live Mint  

It is too early to tell the economic toll from the virus outbreak in China, but the hit to global growth should be "mild," International Monetary Fund chief Kristalina Georgieva said Wednesday. The IMF is expecting a "V-shaped impact," with a sharp decline in activity in China followed by a sharp recovery, meaning there likely will only be a "mild …

Coronavirus crisis to hurt global economy
4 years, 10 months ago

Coronavirus crisis to hurt global economy

India Today  

With coronavirus declared a global emergency, the entire world is going to feel the impact of the massive outbreak that has claimed many lives and infected over 48,000 people in China alone, according to the latest official release. India's Minister of Health, Dr. Harshavardhan, in a press briefing said, "We had declared the novel coronavirus as a health emergency on …

The coronavirus is already hurting the world economy. Here’s why it could get really scary
4 years, 11 months ago

The coronavirus is already hurting the world economy. Here’s why it could get really scary

CNN  

London CNN Business — Nearly two decades have passed since a coronavirus known as SARS emerged in China, killing hundreds of people and sparking panic that sent a chill through the global economy. Car plants across China have been ordered to remain closed following the Lunar New Year holiday, preventing global automakers Volkswagen, Toyota, Daimler, General Motors, Renault, Honda and …

Coronavirus fails to dampen optimism of global share markets
4 years, 11 months ago

Coronavirus fails to dampen optimism of global share markets

ABC  

The death toll may be rising, and more people in more countries are being infected, but for now at least, share markets are looking past coronavirus to a bright 2020. Key points: Markets are coming back to life after getting to grips with the spread of coronavirus The US and China are pumping money into their economies The risk of …

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