Understanding Our Pandemic – Economy Predicament

The world’s number one problem today is that the world’s population is too large for its resource base. Some people have called this situation overshoot. The world economy is ripe for a major change, such as the current pandemic, to bring the situation into balance. The change doesn’t necessarily come from the coronavirus itself. Instead, it is likely to come from the whole chain reaction that has been started by the coronavirus and the response of governments around the world to the coronavirus.

Let me explain more about what is happening.

[1] The world economy is reaching Limits to Growth, as described in the book with a similar title.

One way of seeing the predicament we are in is the modeling of resource consumption and population growth described in the 1972 book, The Limits to Growth, by Donella Meadows et al. Its base scenario seems to suggest that the world will reach limits about now. Chart 1 shows the base forecast from that book, together with a line I added giving my impression of where the economy really was in 2019, relative to resource availability.

Figure 1. Base scenario from 1972 Limits to Growth, printed using today’s graphics by Charles Hall and John Day in “Revisiting Limits to Growth After Peak Oil,” with dotted line added corresponding to where the world economy seems to be in 2019.

In 2019, the world economy seemed to be very close to starting a downhill trajectory. Now, it appears to me that we have reached the turning point and are on our way down. The pandemic is the catalyst for this change to a downward trend. It certainly is not the whole cause of the change. If the underlying dynamics had not been in place, the impact of the virus would likely have been much less.

The 1972 model leaves out two important parts of the economy that probably make the downhill trajectory steeper than shown in Figure 1. First, the model leaves out debt and, in fact, the whole financial system. After the 2008 crisis, many people strongly suspected that the financial system would play an important role as we reach the limits of a finite world because debt defaults are likely to disturb the worldwide financial system.

The model also leaves out humans’ continual battle with pathogens. The problem with pathogens becomes greater as world population becomes denser, facilitating transmission. The problem also becomes greater as a larger share of the population becomes more susceptible, either because they are elderly or because they have underlying health conditions that have been hidden by an increasingly complex and expensive medical system.

As a result, we cannot really believe the part of Figure 1 that is after 2020. The future downslopes of population, industrial production per capita, and food per capita all seem likely to be steeper than shown on the chart because both the debt and pathogen problems are likely to increase the speed at which the economy declines.

[2] It is far more than the population that has overshot limits.

The issue isn’t simply that there are too many people relative to resources. The world seems to have

  • Too many shopping malls and stores
  • Too many businesses of all kinds, with many not very profitable for their owners
  • Governments with too extensive programs, which taxpayers cannot really afford
  • Too much debt
  • An unaffordable amount of pension promises
  • Too low interest rates
  • Too many people with low wages or no wages at all
  • Too expensive a healthcare system
  • Too expensive an educational system

The world economy needs to shrink back in many ways at once, simultaneously, to manage within its resource limits. It is not clear how much of an economy (or multiple smaller economies) will be left after this shrinkage occurs.

[3] The economy is in many ways like the human body. In physics terms, both are dissipative structures. They are both self-organizing systems powered by energy (food for humans; a mixture of energy products including oil, coal, natural gas, burned biomass and electricity for the economy).

The human body will try to fix minor problems. For example, if someone’s hand is cut, blood will tend to clot to prevent too much blood loss, and skin will tend to grow to substitute for the missing skin. Similarly, if businesses in an area disappear because of a tornado, the prior owners will either tend to rebuild them or new businesses will tend to come in to replace them, as long as adequate resources are available.

In both systems, there is a point beyond which problems cannot be fixed, however. We know that many people die in car accidents if injuries are too serious, for example. Similarly, the world economy may “collapse” if conditions deviate too far from what is necessary for economic growth to continue. In fact, at this point, the world economy may be so close to the edge with respect to resources, particularly energy resources, that even a minor pandemic could push the world economy into a permanent cycle of contraction.

[4] World governments are in a poor position to fix the current resource and pandemic crisis.

In our networked economy, too low a resource base relative to population manifests itself in a strange way: It appears as an affordability crisis that leads to very low prices for oil. It also appears as terribly low prices for many other commodities, including copper, lithium, coal and even wholesale electricity. These low prices occur because too large a share of the population cannot afford finished goods, such as cars and homes, made with these commodities. Recent shutdowns have suddenly increased the number of people with low income or no income, pushing commodity prices even lower.

If resources were more plentiful and very inexpensive to produce, as they were 50 or 70 years ago, wages of workers could be much higher, relative to the cost of resources. Factory workers would be able to afford to buy vehicles, for example, and thus help keep the demand for automobiles up. If we look more deeply into this, we find that energy resources of many kinds (fossil fuel energy, nuclear energy, burned biomass and other renewable energy) must be extraordinarily cheap and abundant to keep the system growing. Without “surplus energy” from many sources, which grows with population, the whole system tends to collapse.

World governments cannot print resources. What they can print is debt. Debt can be viewed as a promise of future goods and services, whether or not it is reasonable to believe that these future goods and services will actually materialize, given resource constraints.

We are finding that using shutdowns to solve COVID-19 problems causes a huge amount of economic damage. The cost of mitigating this damage seems to be unreasonably high. For example, in the United States, antibody studies suggest that roughly 5% of the population has been infected with COVID-19. The total number of deaths associated with this 5% infection level is perhaps 100,000, assuming that reported deaths to date (about 80,000) need to be increased somewhat, to match the approximately 5% of the population that has, knowingly or unknowingly, already experienced the infection.

If we estimate that the mean number of years of life lost is 13 years per person, then the total years of life lost would be about 1,300,000. If we estimate that the US treasury needed to borrow $3 trillion dollars to mitigate this damage, the cost per year of life lost is $3 trillion divided by 1.3 million, or $2.3 million per year of life lost. This amount is utterly absurd.

This approach is clearly not something the United States can scale up, as the share of the population affected by COVID-19 relentlessly rises from 5% to something like 70% or 80%, in the absence of a vaccine. We have no choice but to use a different approach.

[5] COVID-19 would have the least impact on the world economy if people could pay little attention to the pandemic and just “let it run.” Of course, even without mitigation attempts, COVID-19 might bring the world economy down, given the distressed level of today’s economy and the shutdowns experienced to date.

Shutting down an economy has a huge adverse impact on that economy because quite a few workers who are in good health are no longer able to make goods and services. As a result, they have no wages, so their “demand” goes way down. If the economy was already having an affordability crisis for goods made with commodities, shutting down the economy tends to greatly add to the affordability crisis. Prices of commodities tend to fall even lower than they were before the crisis.

Back in 1957-1958, the Asian pandemic, which also started in China, hit the world. The number of deaths was up in the range of the current pandemic, relative to population. The estimated worldwide death rate was 0.67%.  This is not too dissimilar from a death rate of 0.61% for COVID-19, which can be calculated using my estimate above (100,000 deaths relative to 5% of the US population of 33o million).

Virtually nothing was shut down in the US for the 1957-58 pandemic. When doctors or nurses became sick themselves, wards were simply closed. Would-be patients were told to stay at home and take aspirin, unless a severe case developed. With this approach, the US still faced a short recession, but the economy was soon growing again. Populations seemed to reach herd immunity quite quickly.

If the world could somehow have adopted a similar approach this time, there still would have been some adverse impact on the economy. A small percentage of the population would have died. Some businesses might have needed to be closed for a short time when too many workers were out sick. But the huge burden of job loss by a substantial share of the economy could have been avoided. The economy would have had at least a small chance of rebounding quickly.

[6] The virus that causes COVID-19 looks a great deal like a laboratory cross between SARS and HIV, making the likelihood of a quick vaccine low.

In fact, Professor Luc Montagnier, co-discoverer of the AIDS virus and winner of a Nobel Prize in Medicine, claims that the new coronavirus is the result of an attempt to manufacture a vaccine against the AIDS virus. He believes that the accidental release of this virus is what is causing today’s pandemic.

If COVID-19 were simply another influenza virus, similar to many we have seen, then getting a vaccine that would work passably well would be a relatively easy exercise. At least one of the vaccine trials that have been started could be reasonably expected to work, and a solution would not be far away.

Unfortunately, SARS and HIV are fairly different from influenza viruses. We have never found a vaccine for either one. If a person has had SARS once, and is later exposed to a slightly mutated version of SARS, the symptoms of the second infection seem to be worse than the first. This characteristic interferes with finding a suitable vaccine. We don’t know whether the virus causing COVID-19 will have a similar characteristic.

We know that scientists from a number of countries have been working on so-called “gain of function” experiments with viruses. These very risky experiments are aimed at making viruses either more virulent, or more transmissible, or both. In fact, experiments were going on in Wuhan, in two different laboratories, with viruses that seem to be not too different from the virus causing COVID-19.

We don’t know for certain whether there was an accident that caused the release of one of these gain of function viruses in Wuhan. We do know, however, that China has been doing a lot of cover-up activity to deter others from finding out what actually happened in Wuhan.

We also know that Dr. Fauci, a well-known COVID-19 advisor, had his hand in this Chinese research activity. Fauci’s organization, the National Institute for Allergy and Infectious Diseases, provided partial funding for the gain of function experiments on bat coronaviruses in Wuhan. While the intent of the experiments seems to have been for the good of mankind, it would seem that Dr. Fauci’s judgment erred in the direction of allowing too much risk for the world’s population.

[7] We are probably kidding ourselves about ever being able to contain the virus that causes COVID-19. 

We are gradually learning that the virus causing COVID-19 is easily spread, even by people who do not show any symptoms of the disease. The virus can spread long distances through the air. Tests to see if people are ill tend to produce a lot of false negatives; because of this, it is close to impossible to know whether a particular person has the illness or not.

China is finding that it cannot really contain the virus that causes COVID-19. A recent South China Morning Post article indicates that roughly 14 million people are to be tested in the Wuhan area in the next ten days to try to control a new outbreak of the virus.

It is becoming clear, as well, that even within China, the lockdowns have had a very negative impact on the economy. The Wall Street Journal reports, China Economic Data Indicate V-Shaped Recovery Is Unlikely. Supply chains were broken; wholesale commodity prices (excluding food) have tended to fall. Joblessness is increasingly a problem.

[8] If we look at deaths per million by country, it is difficult to see that lockdowns are very helpful in reducing the spread of disease. Masks seem to be more beneficial.

If we compare death rates for mask-wearing East Asian countries to death rates elsewhere, we see that death rates in mask-wearing East Asian countries are dramatically lower.

Figure 2. Death rates per million population of selected countries with long-term exposure to the virus causing COVID-19, based on Johns Hopkins death data as of May 11, 2020.

Looking at the chart, a person almost wonders whether lockdowns are a response to requests from citizens to “do something” in response to an already evident surge in cases. The countries known for their severe lockdowns are at the top of the chart, not the bottom.

In fact, a preprint academic paper by Thomas Meunier is titled, “Full lockdown policies in Western Europe countries have no evident impacts on the COVID-19 epidemic.” The abstract says, “Comparing the trajectory of the epidemic before and after the lockdown, we find no evidence of any discontinuity in the growth rate, doubling time, or reproduction number trends.  .  . We also show that neighboring countries applying less restrictive social distancing measures (as opposed to police-enforced home containment) experience a very similar time evolution of the epidemic.”

It appears to me that lockdowns have been popular with governments around the world for a whole host of reasons that have little to do with the spread of COVID-19:

  • Lockdowns give an excuse for closing borders to visitors and goods from outside. This was a direction in which many countries were already headed, in an attempt to raise the wages of local workers.
  • Lockdowns can be used to hide the fact that factories need to be closed because of breaks in supply lines elsewhere in the world.
  • Many countries have been faced with governmental protests because of low wages compared to the prices of basic services. Lockdowns tend to keep protesters inside.
  • Lockdowns give the appearance of protecting the elderly. Since there are many elderly voters, politicians need to court these voters.

[9] A person wonders whether Dr. Fauci and members of the World Health Organization are influenced by the wishes of vaccine and big pharmaceutical companies.

The recommendation to try to “flatten the curve” is, in part, an attempt to give vaccine and pharmaceutical makers more time to work on their products. Is this really the best recommendation? Perhaps I am being overly suspicious, but we recently have been dealing with an opioid epidemic which was encouraged by manufacturers of Oxycontin and other opioids. We don’t need another similar experience, this time sponsored by vaccine and other pharmaceutical makers.

The temptation of researchers is to choose solutions that would be best from the point of their own business interests. If a researcher gets much of his funding from vaccine and big pharmaceutical interests, the temptation will be to “push” solutions that are beneficial to these interests. In some cases, researchers are able to patent approaches, even when the research is paid for by governmental grants. In this case they can directly benefit from a new vaccine or drug.

When potential solutions are discussed by Dr. Fauci and the World Health Organization, no one brings up improving people’s immunity so that they can better fight off the novel coronavirus. Few bring up masks. Instead, we keep being warned about “opening up too soon.” In a way, this sounds like, “Please leave us lots of customers who might be willing to pay a high price for our vaccine.”

[10] One way the combination of (a) the activity of the virus and (b) our responses to the virus may play out is as a slow-motion, controlled demolition of the world economy. 

I think of what we are experiencing as being somewhat similar to a toggle bolt going around and around, moving down a screw. As the toggle bolt moves around, I picture it as being similar to the virus and our responses to the viruses hitting different parts of the world economy.

Figure 3. Image of how the author sees COVID-19 as being able to hit the economy multiple times, in multiple ways, as its impact keeps impacting different parts of the world.

If we look back, the virus and reactions to the virus first hit China. China’s recovery is moving slowly, in part because of reduced demand from outside of China now that the virus is hitting other parts of the world. In fact, additional layoffs occurred after Chinese shutdowns ended, because it then became clear that some employers needed to permanently scale back operations to meet the new lower demand for their product.

Commodity prices, including oil prices, are now depressed because of low demand around the world. These low prices can be expected to gradually lead to closures of wells and mines extracting these commodities. Processing centers will also close, making these commodities less available even if demand temporarily rises.

As one country is hit by illnesses and/or shutdowns, we can expect supply lines for manufacturing around the world to be disrupted. This will lead to yet more business closures, some of them permanent. Debt defaults tend to happen as businesses close and layoffs occur.

With all of the layoffs, governments will find that their tax collections are lower. The resulting governmental funding issues can be expected to lead to new rounds of layoffs.

Natural disasters such as hurricanes, tornadoes, floods, earthquakes and forest fires can be expected to continue to happen. Social distancing requirements, inadequate tax revenue and broken supply lines will make mitigation of all of these disasters more difficult. Electrical lines that fall down may stay down permanently; bridges that are damaged may never be repaired.

Initially, rich countries can be expected to try to help as many laid-off workers as possible with loans and temporary stipends. But, after a few months, even with this approach, many individual citizens and businesses will likely not be able to pay their rent. Default rates on home mortgages and auto loans can be expected to rise for a similar reason.

We can expect to see round after round of business failures and layoffs of employees. Financial systems will become more and more stressed. Pensions are likely to default. Death rates will rise, in part from epidemics of various kinds and in part from growing problems with starvation. In fact, in some poor countries, lower-income citizens are already having difficulty being able to afford adequate food. Eventually we can expect collapsing governments (similar to the collapse of the central government of the Soviet Union) and overthrown governments.

Longer-term, after this demolition ends, there may be some surviving pieces of economies. These new economies will be much smaller and less dependent upon each other, however. Currencies are likely to be less interchangeable. The remaining people will need to learn to make do with many fewer goods than are available today. It will be a very different world.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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3,868 Responses to Understanding Our Pandemic – Economy Predicament

  1. Harry McGibbs says:

    “US president Donald Trump’s administration is weighing removing Hong Kong’s special treatment under US trade laws in response to Beijing’s tightening control over its special territory.

    “A US law passed in November requires the administration to submit a report to Congress by 25 May to determine whether Beijing is using Hong Kong’s special customs treatment under US laws to subvert the far more extensive restrictions on trade in technology and dual use items with mainland China.”

    https://www.argusmedia.com/en/news/2108731-us-weighs-removing-hong-kongs-special-trade-status

  2. Yoshua says:

    India and Pakistan are fighting in the Himalayas. China has now occupied an Indian military base in Indian territory in the Himalayas.

    The one who controls the Himalayas, control the glaciers, water and life in Asia.

    India is under Coronavirus lockdown.

    The virus is a bioweapon, created in a lab in Wuhan.

    What if the virus release in Wuhan was controlled? The aim was to spread it through out the world? The Chinese knew what they were doing and could stop the spread of the virus inside China?

    This is a Chinese attack to take control of the Eurasian continent, while the rest of the world is fighting to contain the spread of the virus?

  3. Harry McGibbs says:

    “The majority of households are in personal financial crisis, or are close to falling into it, an international survey including 3000 New Zealanders showed.

    “Already one in 10 Kiwi households had missed a mortgage or rent payment as a result of the Covid-19 economic crisis, the research from the taxpayer-funded Commission for Financial Capability indicated.”

    https://www.stuff.co.nz/business/121628668/majority-of-households-either-in-financial-crisis-or-on-the-brink

    • Harry McGibbs says:

      “COVID-19 has left the Canadian economy in tatters, with skyrocketing unemployment.

      “The overstretched and vulnerable Canadian housing market is starting to collapse. I believe the big 5 Canadian banks are in for a very tough year.”

      https://seekingalpha.com/article/4350032-canadian-housing-collapse-and-big-5-banks

      • Fast Eddy says:

        The implication is simple: Canadians with extremely tight finances are suddenly facing a loss of income and can no longer pay their mortgages. Currently, over 20% of borrowers in Ontario, Alberta and Quebec are unable to make their mortgage payments. The chart below illustrates this using mortgage deferrals as the determining factor.

        The problem with these deferrals is they’re only a temporary pain-killer. The payments, interest and interest-on-deferred-interest must be paid later. The success or failure of this deferral strategy is completely dependent on Canadian employment recovering very quickly over the next few months. If people continue to defer, there will be a point of reckoning in the future.

        • Fast Eddy says:

          hahaha this guys is clueless… this is death spiral… and it’s not just Canadian property

          As I mentioned at the start, the big 5 Canadian banks will likely get through this crisis and will probably maintain their dividends. That doesn’t mean it won’t be a painful journey. If you like the banks now, you’ll love them if they decline by another 20-30%.

          • Harry McGibbs says:

            Perhaps they will do what Exxon is doing, ie borrow money so that they can pay out more in dividends than they make in net income, lol.

            Most of the contributors to SeekingAlpha have to work an investment angle into their analyses. I don’t begrudge them that. It’s a great site for the most part.

            • neil says:

              I read that recently and was flabbergasted. If I ran my business like that I’d be living in a tent.

          • GBV says:

            Canadian banks are such a racket. If one or two go down, it wouldn’t surprise me if the entire Canadian banking system collapsed. They’re too much of an oligopoly – no real competition to be found… unless you’re talking competition for which bank can have the craziest, most ridiculous employees (i.e. the ones who can spend the most on escort services with their credit cards that conceal their true nature by naming themselves like an audio-visual company – “Vision & Sound”, or the ones who can get kicked out of the most high-end steak houses by getting drunk and throwing steak knives into the artwork on the walls), in which case CIBC takes the cake (or at least that was my understanding about a decade ago… perhaps they’ve cleaned up their investment banking group since then).

            Cheers,
            -GBV

            • Fast Eddy says:

              Big Picture … we are staring at GFC 2.0 on steroids…. millions of Canadians cannot pay their mortgages… and will not be able to pay them because the jobs are gone…. never to return.

              I assume the central banks of Canada is supporting the banks … because obviously if millions are on mortgage holidays …. the banks need to be paid by someone?

              I wonder if here in NZ if one just stopped paying the mortgage what would happen? I suspect nothing….

            • Matthew Krajcik says:

              “Canadian banks are such a racket. If one or two go down, it wouldn’t surprise me if the entire Canadian banking system collapsed. ”

              There won’t be any collapses, the Bank of Canada has mastered the art of quiet bailouts. While everyone in the States was making such a fuss back in 2008, all the banks in Canada got a quiet bailout likely much larger than the American ones, with no press, no debates, no panic. That’s why the housing bubble keeps going.

            • GBV says:

              @ Fast Eddy,

              “I assume the central banks of Canada is supporting the banks … because obviously if millions are on mortgage holidays …. the banks need to be paid by someone?”

              Perhaps there is some current support (I haven’t really looked into it myself lately), but in the long run, most of the mortgages up here in Canada are backstopped by the taxpayer through the Canadian Mortgage and Housing Company (CMHC)… basically a Canadian crown corporation that probably is very similar to Fannie Mae / Freddie Mac.

              I’m a pretty petty, vindictive, self-loathing Canadian who has been screaming about the CDN housing bubble for about 10 years now, only to watch my own life implode and collapse about 4 years ago, so few things would please me more than seeing utter armageddon in the Canadian economy and housing market. If everyone around me loses everything (save for the very few people – I can count them on one hand – who’ve actually listened to my crazy talk and took some steps to prepare for a very ugly future), it might make it feel as if my situation ain’t so bad (yes, I’m terrible, but at least I’m honest about it).

              @ Matthew Krajcik,

              “While everyone in the States was making such a fuss back in 2008, all the banks in Canada got a quiet bailout likely much larger than the American ones, with no press, no debates, no panic.”

              My understanding is that some of the $114 billion in bailouts to Canadian banks was actually provided by the US Federal Reserve 😐 The Bank of Canada (BoC) and the aforementioned CMHC also bought up a lot of assets from Canadian banks to provide “liquidity”. The Canadian banks paid back this money, so of course, every Bay Street financial ass-clown argues that it wasn’t a “bailout” but a “loan”. Of course, had that “liquidity” not been provided in the form of loans, the banks would have needed to be bailed out or would have had to fire-sale their assets at distressed prices – smells like a bailout to me!

              In any event, I’m not sure if Canada could pull those shenanigans a second time, as we’re collectively much more in debt as a nation this time around. Though I do wonder if the Fed would step in a prop up Canada to maintain stability in the North American financial markets, as Canada and the US may be too interconnected financially (in our already overly-connected / dependent global financial system)…

              Cheers,
              -GBV

            • Fast Eddy says:

              so few things would please me more than seeing utter armageddon in the Canadian economy and housing market.

              That’s not so bad…

              Nothing would please me more than seeing utter armageddon and the extinction of every single human on the planet.

              It is quite satisfying to know that once BAU goes…. there will be no way to stop the radiation spewing for a thousand years ensuring the cancer is completely wiped off the planet

            • Matthew Krajcik says:

              Here’s a small at home study growing carrots at 500X background radiation. I wonder if he’ll eat them when they’ve grown?
              https://www.youtube.com/user/Thunderf00t/community

            • Yorchichan says:

              Nothing would please me more than seeing utter armageddon and the extinction of every single human on the planet.

              I wonder how much further the extinctions will go. All mammals? All vertebrates? Worse?

            • Yorchchan says:

              As Stalin once said, “the death of an individual member of a species is a tragedy, the extinction of a species is a statistic”.

              Or something like that.

        • GBV says:

          Thank goodness I was a social deviant and never considered taking out a mortgage to buy an overpriced shoebox in Toronto. I’d probably be hurting now if I had, and I would have had to forgo all those fun times over the past decade of obsessive-compusively shopping online for guns, ammo, tactical gear, freeze-dried foods, water purification devices, iodine tablets, etc. and other useless consumer goods. No fun! 😦

          Cheers,
          -GBV

      • Minority Of One says:

        The Automatic Earth over the last few years (but not recently) contained quite a few articles on the property markets of Canada and Australia. They both somehow or other managed to avoid the property downturns experienced pretty much everywhere else after the 2008 fiasco, and property prices went crazy compared to everywhere else, right up until last year. Prices will crash just like everywhere else, but there they have a lot further to fall. Bigger loans that cannot be repaid. Certainly here in the UK, the govt won’t hesitate to bail-out, or bail-in, bankrupt banks.

        • neil says:

          Time to make a deposit in Banco di Mattress.

        • GBV says:

          I’ve been waiting a decade for this. I’ll savor it when it finally arrives, but in all honesty, it’ll lose a bit of its appeal if it finally arrives when the rest of the world is collapsing due to famine, disease and war (i.e. hard to enjoy being right about falling house prices and not having exposed yourself to a colossal mortgage when your neighbors are spilling each others’ blood in the streets)…

          Cheers,
          -GBV

          • Fast Eddy says:

            The global famine has appeal for me…. it signals that humans are done…. all that will remain is for the Spent Fuel Ponds to … sing…

        • thestarl says:

          200k immigrants and tax breaks for property investors no doubt helped. Also I think something like 40% of new owner occupier mortgages are interest only.
          So now due to Cov19 immigration has been halted and over the next few years the bulk of these interest only loans converting to principle to will be interesting to see if there is not a major correction.

    • Why is this a surprise?

  4. Harry McGibbs says:

    “While attention in developed countries has been focused inward on the effects of the pandemic at home and the anticipated exit from lockdown, an economic and health disaster is emerging in developing counties that make up 85% of the world’s population…

    “Even more worrying is the massive economic damage that has already been caused by both the pandemic and the widespread lockdowns that most developing countries have imposed. UN agencies estimate that 1.5 billion people – half the global labour force – will become unemployed, with 500 million thrust back into poverty while 250 million could face famine, reversing all the gains of the past two decades.

    “The collapse of the global economy will seriously damage our chances of recovery, hurting exports, disrupting supply chains and threatening the global financial system. The failure to contain the global spread of virus will also ensure that a reservoir of infection remains that could jump back to developed countries.”

    https://theconversation.com/developing-countries-are-facing-economic-disaster-four-ways-western-nations-can-support-them-to-shore-up-the-global-economy-139083

    • The virus seems to find groups of people who work (or live) together in areas without good ventilation. We almost need workers who have antibodies in order to keep these mines operating.

  5. Fast Eddy says:

    Getting a little testy https://freehk.live/

  6. Fast Eddy says:

    Watching these HK feeds… and I am reminded why some Americans insist on the right to own guns…. how different would the HK situation if they had American gun laws….

    • Matthew Krajcik says:

      The thing is, if both sides have lots of guns, everyone is really polite. People don’t toss rocks or molotovs if there are hundreds of men with rifles on both sides.

      On the other hand, all it takes is one person perched high up to shoot a couple people on each side, and you have a Euromaidan situation pretty quickly.

  7. Herbie Ficklestein says:

    Two-thirds of laid-off workers may temporarily be receiving more money in unemployment benefits than they did from their jobs
    By Andrew Keshner
    Published: May 26, 2020 10:00 pm ET

    Democrats want to extend the payout beyond July expiration date, but Republicans say the benefits are too rich
    https://www.marketwatch.com/amp/story/guid/FA1354CA-9F6F-11EA-9230-2479E8E76B05

    Too much!😎 This headline here in the US has been recycled over and over again in many spots and appears as propaganda to make it appear that “workers” will be hesitant to return back to work to their former jobs because of their unemployment cheque!?
    Well, if they relied on it in the State of Florida the amount was well under $300 week until the Federal Government boosted it up. Can’t make this up, never mind I’d rather be part of the risk taking investor owner class that sits around waiting for my dividend cheque.

    Perhaps another tax cut is in order…that’s what I read

    As federal lawmakers debate another relief package for the coronavirus pandemic that’s put approximately 35 million Americans out of work, a new study shows how generous (or not) the added unemployment benefits were in the initial stimulus bill addressing the crisis.

    Two-thirds (68%) of jobless workers would bring home more money from their state unemployment insurance plus the $600 weekly supplement from the federal government than they would have on the job, according to University of Chicago researchers

    • Stevie says:

      So ordinary working stiffs finally getting enough from the otherwise shredded safety net to actually pay their bills? Oh, the horror!

  8. Minority Of One says:

    UK furlough scheme now covers 8.4 million workers
    https://www.bbc.co.uk/news/business-52819591

    “Some 8.4 million workers are now covered by the government’s furlough scheme, up from eight million a week earlier, the Treasury has said.
    … A similar scheme for self-employed workers saw 2.3 million claims made worth £6.8bn.”

    And the UK’s plans to fix our electricity supply issues?

    Sizewell C: Nuclear power station plans for Suffolk submitted
    https://www.bbc.co.uk/news/uk-england-suffolk-52813171

    Good thing nuclear plants take years to get going.

  9. Herbie Ficklestein says:

    First China Flu, Next Lockdown, Next Income Loss, now this….BBC News….
    The Indian capital, Delhi, saw temperatures rise to 47.6C @120 F on Tuesday, as most of north India faced
    severe heatwave conditions.
    The heatwave, which officials say is likely to last until the weekend, comes even as the region struggles with rising Covid-19 infections and swarms of locusts that are ravaging crops.
    Churu in Rajasthan state recorded a temperature of 50C – India’s highest.
    Officials have warned people to stay indoors as far as possible.
    The temperatures are the highest that the country has seen in decades for this time of the year. In fact, global weather tracking website El Dorado said the region was the hottest in the world on Tuesday.
    Weather officials told local media that part of the reason for the heatwave was the powerful storm – Cyclone Amphan – that struck parts of eastern India and Bangladesh last week.
    “Super cyclone Amphan sucked out all the moisture from other parts of the country,” Kuldeep Shrivastava, the head of the regional weather forecasting centre told the Hindustan Times newspaper.
    Can it get any worse!?….Oops sorry. Good Shortage….more to come

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