The World Trade Organization (WTO), which includes 164 nations, is predicting a very significant downturn in global trade… between 13 percent and 30 percent… this year.
Those are staggering numbers. .
President Trump is pulling out all the stops to get the American economy back on-line by May, despite pushback from epidemiologists who fear that the Covid-19 pandemic will still be active. In fact, those same folks indicate that there is a possibility that the coronavirus will re-emerge late in the year.
If I had to guess, I would predict that our impetuous President will jump the gun, declare the virus defeated, and urge folks to return to work…even if its not safe for them to do so.
Trump’s publicly stated belief is that the U.S. economy will “boom” when the switch is thrown. This is, unfortunately, wishful thinking. A good portion of the economy has taken grievous injuries from this catastrophe and many businesses won’t survive. The same goes for businesses in economies all over the world…that the U.S. relies on in trade. They’re hurting, too, and the WTO estimates are an indication of the damage.
A worldwide deep recession seems to be in the works.
America’s GDP is driven by services, and there will be less demand for those in a recessionary economy because there will be less disposable income. Hospitality services and leisure industries in the U.S. will take a hard hit. Lots of bars, restaurants, hotels, and even theme parks will go bankrupt. People will recreate in less extravagant ways.
Our retail and manufacturing industries rely on hard goods manufactured in other countries. Those foreign producers are hurting already, and the pandemic has just begun for some of them. Plus, there will less demand for expensive hard goods in America, as household budgets tighten. Fashion retailers will suffer the most. Some, like Sears, J.C. Penney, Neiman Marcus, and J.Crew probably will fold this year, to be followed by many of the smaller businesses that populate retail malls. Our frugal population will purchase fewer new cars, and the home building industry will stagnate. Pawn shops will prosper.
Donald Trump will be frustrated as Hell, as “his” economy falters.
For once, something crappy happening on his watch…is not his fault…particularly a pandemic-induced economic collapse. The fact of the matter is…we wouldn’t be any better off if Jesus Christ himself was at the helm. It’s just bad timing, that’s all.
Abe Lincoln and George W. Bush know what you’re feeling, Mr. President.
Unfortunately for us all, the “new normal” American economy is going to be a more petite version of that which we were enjoying a few months ago. Same goes for the economies all over the globe. Belt-tightening time. No more whipped cream atop the chocolate sundae. In fact, no more sundaes, for a while.
Time for tomato soup.
Recession, depression or whatever comes our way, I believe Americans will rise to the challenge, like we always do. And, maybe, we’ll be the better for it in the long run.
BTW, today Bernie Sanders dropped out of the 2020 Democratic primary process, leaving Joe Biden as President Trump’s opponent in the November election.
If I was Biden, I’d have to wonder if this news is a blessing or a curse. With the economy looking so bad, perhaps Biden should run a half-hearted campaign and hope Trump will be stuck trying to make “wine out of water” for four more years?
I can imagine Abe Lincoln receiving the news of his election in 1860: “Congratulations, Mr. President! Oh, by the way, thirteen states just seceded…” Or, President Obama, on his first day in the White House: “Nice to meet you, Sir! First things first: our Nation’s banking system is broken. What do you want us to do?”
No one ever said that the job of President was easy…except Donald Trump.
“Lucky” Bernie Sanders will probably sleep very well tonight.
