| I am not an economist but by virtue of working in the fintech space for many years, particularly in credit, feel this specific point acutely- "economies and democracies cannot idle with incurring enormous financial costs" This is what worries me about this crisis more than the myriad other issues, like- -the end is unknown bc we dont have an antiviral treatment or vaccine, and we dont know how long immunity lasts -we have generally awful, sociopathic high level leadership (I am in the US) and while local leadership may be exemplary (I am in NYS) the ongoing contagion factor means there is no isolation -so many entities have already been broken that will never return and the implications from which have not begun to be counted -we have such an awful information availability and consumption imbalance, which will perpetuate bad decision making Those issues above I believe CAN be dealt with over time, with study, process, mobilization, etc in the course of this pause. But that work has to be FUNDED. We DO NOT KNOW how to fund this without a) creating future "costs" / "obligations" that will weigh on future flows for decades b) destroying current asset stores in a way that increases uncertainty I mean, this is what "assets" are for- they are there as a store to create future flows. So for instance I am in favor of a very long block on evictions and foreclosures- 2 years- because many renters have lost jobs and will not be able to find them, in order to force landlords to, where necessary, waive rent and themselves take out mortgages to pay for their own flows. That is what the "value" of their property should be used for, and in times of strife, drawing down on asset stores is sensible. But that imposes future costs- the mortgage- and even if the mortgage is at 0% there is still principal that has to be returned. And debts are the highest priority obligation. IOW, we dont have an economic and accounting system where we can just stop, timeout, change the rules, get back on feet, and start again. In our current model the timeout still has to be paid for in the future. And while history is full of debt foregiveness regimes, those were all local. We don't have even the beginnings of a model to institute a global forgiveness regime. At any rate, the human side of this looks very challenging, though I have optimism that good wins out- but I worry about the accounting side. The rules have to let good come through. |