Covid-19 presents economic policymakers with a new sort of threat
It mixes demand and supply effects
THE ONLY thing we have to fear is fear itself, or so reckoned Franklin Roosevelt. In many an economic downturn that is true—an anxiety-induced reluctance to spend is the main threat to prosperity. For now, the world is treating the outbreak of covid-19, a disease caused by a coronavirus that is now responsible for more than 2,000 deaths, as no exception. Central banks across Asia are easing monetary policy while governments prepare spending programmes to limit the economic damage.
This article appeared in the Finance & economics section of the print edition under the headline “Shock therapy”
Finance & economics February 22nd 2020
- The Bundesbank is caught between a doveish ECB and a suspicious public
- Are there too many central bankers?
- HSBC undergoes yet another overhaul. It still may not be enough
- Michael Milken receives a presidential pardon
- The appeal, and the flaws, of cash-based accounting
- Cash sloshes around the world in unexpected ways
- Student debt in America amounts to over $1.5trn
- Covid-19 presents economic policymakers with a new sort of threat
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