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Friday, 10 April 2020
Recently trending How $200 billion is magically createdHoward Marks on 'Which way now?' - UPDATEDWhat are the possible economic effects of COVID-19 on the world economy?Note to Australia: be more French in the COVID-19 warWelcome to Firstlinks Edition 351
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Bill Gates warned the world in 2015 that we were not ready for the next inevitable pandemic, and we ignored him. The Washington Post has provided free access to his updated views.
With about $350 billion of new government spending announced to combat COVID-19, the obvious question is whether Australia can afford it, especially when national income will fall rapidly.
The missing piece in most analysts' views of the future of the stock market is demographics. The secular bull market until 2019 was driven by a generation that is now retiring and selling equities.
Australia is in a relatively good position to borrow $200 billion, with the RBA using printed money to buy bonds in the market. The long-term consequences are better than the alternative.
The turning point in this crisis will be when the number of new COVID-19 cases starts to decrease. Until then, can we mitigate the damage to businesses and the economy so that we can snap back?
In a widely-quoted scenario using estimated attack and fatality rates of coronavirus, about 0.07% of the population of the US dies. That's about 230,000 people, which the market is not ready for.
This detailed analysis of infections, deaths, drugs and vaccines includes an optimistic scenario: perhaps US and Australian infection numbers will peak in early to mid-April with a decline after.
Andrew Baker is well-known as a superannuation consultant. Now working in the UK, he was caught in France with his family and is in lockdown. He worries Australian policy was too slow.
Coronavirus is a particular worry compared to past epidemics because the world is now so interdependent, but the stockmarket has a habit of exaggerating threats as well as opportunities.
Quantum computers have a theoretical ability to calculate millions of possibilities in seconds, yet it may take time before we see a breakthrough in the practical applications of sub-atomic computing.
Our close links to China mean the impact of the virus could tip the local economy into recession and certain sectors such as resources, education and travel will be harder hit than others.
As we approach the 2020s, we are sailing into uncertain waters at best. These times also have some historical precedents, but we need to make important reforms before our luck runs out.
Howard Marks is the largest investor in the world in distressed securities. What does he think after checking the virus positives and negatives, and how much has he changed his mind in only a few days?
The $130 billion wage stimulus is astounding in its generosity and scope. It's equivalent to the annual budgets for defence, education and health combined. A cafe owner told me a casual dishwasher who was paid $60 for two hours work a week now wants the $1,500 fortnightly payment. Shane Oliver exclusively explains where $200 billion will come from, and some longer-term consequences.
Hamish Douglass outlines the three main issues in the outbreak of coronavirus, with consequences which may change businesses and consumers forever. Will we face V-shape, U-shape or depression?