"The issue is what I have called the No. 1 rule of virus economics: If you want to help the economy, you have to stop the virus. The main economic problem faced today by the United States and much of the world remains much as it has been for almost a year: The virus is out of control and causing people to withdraw from the economy.
It’s important to recognize that this economic withdrawal is not just the result of state lockdown policies. My own research shows that places that never had lockdowns fared about the same as places that did. Regardless of the governments’ rules, people need to feel safe for the economy to flourish in much of the service sector (think airlines, dentists, beauty salons, restaurants, theme parks, and many others).
The current problem in the United States is easy to understand. If the country gets control of the virus, the economy will grow again, as it has in places like China, South Korea and New Zealand. If the virus continues its relentless advance, the economy will need more support or the damage will become permanent. There’s no waiting-to-see-what-happens with the pandemic economy. By the time you can see it, the damage will already be spreading."
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