Warnings of Economic Depression
By Stephen Lendman, March 31, 2020
According to a March 20 – 26 online survey of over 250 companies of varying sizes and business sectors, outplacement firm Challenger, Gray & Christmas reported that nearly half the number surveyed are likely to lay off workers over the next three months. Over one-third (37%) of companies instituted a hiring freeze. The St. Louis Fed projects unemployment potentially reaching 32% of the US workforce, a loss of 47 million jobs if things get this bad.
Coronavirus Shutdown and the Worldwide Corporate Debt Crisis
The coronavirus shutdown is hammering supply and demand across the globe. That has forced the real economy into a sharp recession and triggered a rolling financial crisis. Below is a primer on one key piece of this mess: the crisis in corporate debt markets. This branch of finance is vitally important because even healthy companies often need access to credit. If they do not get it, they go under.In 2008, the vector of crisis ran from mortgage-backed securities to the rest of the financial sector and then to the real economy. This time, the real economy is being hit directly, and the damage is reverberating back into financial markets.
