Which Is Worse: The Great Depression, the 2007-2009 Recession or the Coronavirus Crisis?
Due to the coronavirus epidemic, economic activity in the United States has been suspended by 29%, reports Interfax With reference to a study by Moody’s Analytics for The Wall Street Journal.
It is noted that the actual extent of the impact of the outbreak on the economy cannot be estimated in the coming years. However, economists have already announced an unprecedented suspension of trade due to government measures.
According to Moody’s, 41 US states have decided to temporarily suspend actions that are not significant. Restrictive measures have affected the most densely populated areas, contributing greatly to the country’s economy. Therefore, the separation of 80% of the districts was attributed to 96% of the production. A tenth of the production decline is related to the situation in Los Angeles, New York and Cook County, with Chicago as its center.
Moody’s analyst Mark Zandy believes that the second quarter will not see a 29% decrease in production. The expert believes that economic activity in most areas will begin to recover by summer, and that the US runway will collapse 30% annually in the second quarter.
According to the US Department of Commerce, during the Great Depression (1929–1933), annual production fell by 26%. During the previous recession of 2007–2009, a quarterly decline in production of about 4% was recorded.
According to Zandi, the current crisis compares to the results of a violent earthquake or terrorist attacks on September 11, 2001, when airlines temporarily halted flights. According to Moody’s, the US economy suffered about $ 111 billion in the days after the attack. Three weeks after the introduction of restrictive measures in relation to coronovirus, production dropped by about $ 350 billion.
In addition, more than 10 million Americans have applied for unemployment benefits in two weeks – about 4 million more than before. The number of jobs in March fell for the first time since 2010 – 710 thousand, while unemployment in the country fell from 3.5% to 4.4% in February.
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Earlier, we wrote that the US Democrats from the House of Representatives are preparing a proposal to issue a digital dollar in response to the coronovirus epidemic. The proposed e-dollar will not be presented on the blockchain or decentralized ledger. This means that it will not be a cryptocurrency like bitcoin. This will be the first copy of the central bank’s digital currency in the United States.
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