Thread by @emilyjaneross

Yesterday I sat in on an excellent (booked out) #economics webinar with expert input from Dr Carolina Alves, Prof Stephen Kinsella and Dr. Catriona Cahill examining the impact of #COVID19 on UK and IRE.

#BusinessIntelligence
#recovery
#economicresponse

Here are my notes!

Short sharp shocks: It's important to separate the 'scenarios' from the 'forecasts'. The first is narrative-based! We are assuming a short, sharp shock. Short - (a quarter); sharp (as seen in unemployment figures); and a shock - this wasn't predicted.

One key differentiator in this crisis is that there is no one entity to blame. Not bad banks, or bondholders. We really are all in this together.
#economicresponse

Balance sheet implications for the private sector are profound. There has been excellent and robust liquidity 'first line' supports for businesses, but the government will need to seriously consider the balance sheets of the private sector. Especially if there is a second curve.

State and semi-state bodies: The balance sheets of large organisations such as An Post, RTE, Universities are all decimated. There will be lasting challenges around how these organisations are financed once this crisis passes.

For example, universities are partly supported by the state, and in part by fee-paying students from overseas. That secondary revenue is likely to disappear going forward.
#economy #economicresponse

On recovery: In 2020, unlike previous recessions, emigration is not really an option. (As this crisis is global)
Ireland is highly dependant on multinationals. In this scenario, that's not necessarily a bad thing. This is a community crisis as much as any other.

On recovery: Will there be a V-shaped or a U-shaped recovery in the UK?
The OBR scenario suggests a V-shaped one, a 35% drop in GDP in Q2 but then a sharp recovery. However, household debt and unemployment will have an impact on the speed of recovery.

Given all those implications for the public and private sector, "I have doubts about the actuality of the V shape." (CA)
#economy #recovery

Recovery and coming out of lockdown will be tricky. The country can't just open up all at once, as this will put a strain on supply chains. A phased approach with consideration for each sector (particularly hospitality) will be needed. #SupplyChain

"You can't wake up whole sectors unless you assume the supply chains can be matched appropriately" (SK)
Ending lockdown: #hospitalityindustry will have reduced revenue in the early stages of recovery - for example, restaurants may need to reduce capacity at start

Debt is going to weigh people down. Turnover will be lower and slower than before. Ending lockdown:
Solvency is going to be a challenge. "The government should consider cancelling VAT and Rates payments to support businesses during this phase" SK

Ending lockdown: Denmark has started a phased approach to the end of lockdown and a lot can be learned from countries that are slightly ahead of us. #lockdown #Denmark

#Brexit: With so much uncertainty at present, the UK would do well to take advantage of the extension available. Even without COVID19 impact, there was very little time available to deal with the complications of import and export, fishing rights, border negotiations etc. (CA)

Common debt and Coronabonds: At a macroeconomic level, the ideologies of the past "Austerity as Medicine" need to be left where they belong (in the past). (SK)
#CoronaBonds

Common debt across Europe would reduce everyone's cost of borrowing, so it's a shame the '#CoronaBonds Coronabond' proposal was voted against last week in Europe. For example, Italy's cost of borrowing has actually increased - which is terrible news for them at this point.

Predictions: Some of the biggest changes that have been made will be hard to roll back on. The removal of private healthcare and the expansion of public healthcare resources will be very hard to undo.
#healthcare

Attitudes towards home working and remote working, (for those that can do) will have an impact on many. The biggest changes will be community-based and societal.
#remoteworking

The Social Contract: We need to communicate what our social contract will be when the time comes to pay back the debt we are creating.
#socialcontract

However, it's important to remember that we're bailing each other out. Not the banks, not bondholders. And so there needs to be commonality and consensus around what that means for everyone.
#strongertogether