The virus will peak in a few months and subside and further recede with a vaccine…
The US and World economies will probably sink lower and for longer….
The loss of money and value is as real as the disease losses….
Coronavirus is already the most serious threat to the U.S. economy since the financial crisis, and the dominoes are aligned for a severe recession that could erase much of the 11-year recovery.
What’s happening: While the outbreak itself is unlikely to drive an economic collapse, the U.S. has been something of a ticking time bomb for some time.
- Growth has declined over the last two years despite higher government spending and a $23.4 trillion national debt.
- While the labor market has boomed, many of the jobs added have been hourly service-industry positions that offer limited scope for savings or health insurance.
- 44% of all U.S. workers earn barely enough to live on, a Brookings Institution studyfound in January.
Where it stands: While President Trump said late Monday that he would work with Senate Republicans on a “very substantial” payroll tax cut and relief for hourly workers, such measures — if they can be enacted — could still be insufficient to fend off a recession.
- Consumer spending has held up the economy for the last year, even as the U.S.-China trade war gutted the manufacturing industry and businesses broadly cut back on investments and outlays.
- Many companies chose to hoard their savings from the Tax Cuts and Jobs Act in cash or use it to buy back their own stock.
At the same time, corporate America is more heavily indebted than ever before, due to years of record-low interest rates and increased borrowing….
The crashing stock market and slowing economy are raising worries for older Americans who are retired or preparing to retire.
Stocks fell off a cliff Monday as oil prices dropped and fears of the coronavirus intensified. The Dow Jones Industrial Average was trading down 2,000 points, a 7.8 percent drop, its worst day since the 2008 financial crisis.
That could spell trouble for President Trump as he faces reelection in November as older Americans who voted Republican in 2016 feel the heat and with Democrats seeing an opportunity to sharpen their case for expanding Social Security.
Retirees, or those preparing to retire, often have a significant chunk of their retirement portfolios invested in stocks.
“Disproportionately, older households have more exposure to stock market fluctuations and less time to catch up,” said Monique Morrissey, an economist at the Economic Policy Institute, which focuses on poverty reduction….