“What a recession from something like this should look like is a sudden stop and recovery,” said R. Glenn Hubbard, a Columbia University economist who was a top White House economist for President George W. Bush. “What could happen, though, is a doom loop.”
The “doom loop” that Mr. Hubbard and many other economists fear describes a situation in which an even moderately protracted shutdown of economic activity permanently kills waves of small businesses — and possibly entire industries, like airlines — that cannot survive very long without customers.
A typical small business in the United States does not have enough cash on hand to cover even a month of expenses if its revenues are completely disrupted, according to research by the JPMorgan Chase Institute. In minority communities, where profit margins are often narrower, the typical cash reserve is even smaller.
https://www.nytimes.com/2020/03/22/us/p ... e=Homepage
Read about a lady in Seattle who had just spent her savings opening a little gift shop a few months ago. Things had been going well until the covid shut her down, now she says bankruptcy is just a matter of time.
Most small biz has limited cash to weather a complete income goose egg for more than a short while I'm thinking. A bridge loan might help stay afloat for a short while but adding debt on top of loss, when unlike the stock market you are on the hook for everything instead of just your bet, is pretty risky.
Anyway, if shutdowns and bug-ins last for more than a few weeks lots will go under. Not sure how many left here still work but this could be a much bigger deal on the ground than the 1% loosing some virtual profit.
So anyway, this is for stories of the Doom Loop...
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