又一项让经济预测家惊叹的数据出炉:上周美国申请失业救济的人数达到创纪录的660万人。牛津经济研究院在电子邮件中称,该项数据的“跳涨实在不可思议”,而且还可能成为“新常态”。中间市场审计与咨询公司RSM首席经济学家乔·布鲁苏拉斯撰文称,这种“结构性变化”意味着“实时失业率至少有10.1%。”
当下,全球范围存在着太多的不确定性,经济预测家前脚刚发出自己的预测,后脚就要进一步下调那些预测。短短几周内,高盛便已经数次下调美国第二季度GDP增长预测:从–2%调到–24%,再调到–32%。
从种种预测来看,经济衰退显然会到来,还可能是非常严重的衰退。但是,鉴于形势瞬息万变,美国经济有没可能不只是衰退,而是走向萧条呢?
《财富》与10位经济学家和金融市场专家讨论了这一问题。目前,他们大多认为美国经济衰退基本板上钉钉。至于是否会严重到经济萧条的地步?他们之间有极大的分歧。
毕竟,根据美国国家经济研究局的数据,自1900年以来的22次经济衰退中,只有一次严重到称得上“大萧条”。十九世纪前则有过四次大萧条。
现在似乎有两个阵营。一个阵营认为,经济基本面大体上是稳健的,几乎无法想象会出现萧条。另一个阵营认为,萧条是大概率事件。
经济萧条的定义是什么?
经济衰退通常被定义为连续两个季度出现GDP负增长,而经济萧条则没有一个统一的定义。
由于没有一个官方的定义,经济学家们有着多种不同的定义版本。据佛罗里达国际大学金融学教授、金融系主任拉希德·哈米德称,有的经济学家认为,“经济萧条,就是连续两年或以上出现GDP下滑。有的认为是连续两年GDP下滑幅度超过10%。也有人认为是连续两年失业率超过10%。”
还有一些经济学家倾向于从对比的角度来看待这一问题。乔治梅森大学商学院金融学副教授德里克·霍斯特梅尔表示,“有的人说,出现一年严重的经济萎缩就算萧条。有的人则将时限拉长一些。”
甚至还有一个问题是,是否必须所有人都同时陷入经济麻烦,才算得上经济萧条。“有的社会阶层深陷经济泥沼(萧条),有的阶层则从别人的困境中得到滋养,过着奢华的生活,这种情况是有可能发生的。”经济学家迈克尔·美林指出,“传统的美国中产阶级从1970年代中期就清楚知道这种情况,非裔美国人甚至知道得更早。这种问题的影响,在每一项常见的健康、经济和社会福利统计数据上都会明显显现出来。”美林是罗格斯管理与劳动关系学院专业实践教授兼劳动教育行动研究网络主任。
又或者,正如投资银行公司Cassel Salpeter & Co联合创始人兼董事长詹姆斯·卡塞尔所提到的那句俗话所言,“邻居失业了是经济衰退,自己失业了就是经济萧条。”
与衰退一样,萧条通常也是经济数据出炉以后才能事后诊断。但到那个时候,事情通常都已经发生了,而不是正在发生,这一点要不同于美国生活许多其它的方面。
“我们实际上掌握了主流广播节目每分钟的听众数据,”威奇塔州立大学巴顿商学院国际商务特聘讲座教授、管理学教授兼国际商务发展中心主任乌沙·哈利指出,“我们知道谁会去购买产品,会发生什么。而这一次,我们头一回没有做出预测所需要的那些经济数据。”经济形势变化太快也太大了,以至于预测家根本无法根据最近的模式建立预测模型。
哈米德说,“这种(涉及疫情的)情况非常罕见,经济学家没有办法建立良好的模型来预测经济复苏会是什么样的。”
经济学家衡量GDP的方式也存在一个固有的问题。他们通常是关注季度之间的变动,然后据此估算年度增长率。例如,预测说第二季度GDP将下跌32%,它就意味着,假定第一季度和第二季度之间的变动幅度维持一整年,那么这一年的全年GDP也将下跌32%。
这对于外行人来说可能不大好理解。“按照季度环比计算的方式,如果第一季度经济大幅下滑,第二季度也出现同样的下滑幅度,那么经济增长为零。”TS Lombard首席美国经济学家史蒂文·布利茨指出。经济学家和媒体提到的增长率一下子就变成0%,听起来比下跌32%要好得多,但情况仍然很糟糕。
鉴于所有的这些因素,美国经济是否正走向萧条,实在很不好判断。
乐观派
在乐观派看来,美国经济跌得有多快,反弹就有多快。他们给出的论据包括,疫情爆发前美国经济整体表现强劲,疫情并不涉及经济本质,以及一旦人们的工作和生活恢复正常,疫情期间被抑制的消费需求会彻底爆发的推论。
佛罗里达国际大学的哈米德等人认为,鉴于疫情危机爆发前美国经济向好,出现萧条的“可能性非常非常低。”威奇托州立大学的哈利表示认同,“我们处在漩涡的最中心,我们在战斗。疫情一旦结束,我们就会收复失地。”
威斯康星大学密尔沃基分校经济学教授昆丹·基肖尔在发给《财富》的电子邮件中称,经济萧条的可能性只有“百分之一”。他认为可能会出现两种情况:一是经济暂时大幅下滑,但第三季度和第四季度迅速复苏;二是如果疫情在秋季重新爆发,会出现“双底型衰退”。
在卡内基梅隆大学泰珀商学院经济学教授塞文·耶尔特金看来,如果经济下行发生,并持续数月,那么情况会更严峻。“但是,如果我们能够重启经济活动,哪怕只是非全面的重启,资本都不会被摧毁,”她说道,“就业岗位也不会被大量摧毁。复苏应该会很快,因而不会有什么风险。”
“经济活动的收缩是疫情导致的,迫不得已的,因此日后能够恢复过来。所以说,这一次与往常因为政策失误演变成萧条的经济衰退大不相同。” TS Lombard的布利茨说道。
悲观派
还有另一种观点。“现在大多数经济模型都显示,第二季度失业率将高达25%到30%,”乔治梅森大学教授霍斯特梅尔更多地从经济萎缩的程度而非持续时间来谈,“当前传出的数据真的非常糟糕。这些预测比大萧条时期的任何情况都要糟糕。因此,我们当然可以称之为萧条,即便它只是持续一两个季度。”
约翰斯·霍普金斯大学凯瑞商学院金融学副教授亚历山德罗·雷布奇利用能源使用、交通模式等间接的经济活动指标展开了研究。他也强调,其研究结果显示,此次经济萎缩相当严重。“此次衰退带来了巨大的挑战,而且可能会持续更久,进一步恶化,甚至可能会变得比2008年至09年的大衰退还要严重。那次大衰退持续了六个季度,失业率达到10%。”他说,“目前有些估算说,这一次可能要严重两到三倍,比大萧条时期还要糟糕。”
雷布奇还指出,瀑布效应将会蔓延到整个经济。“人们将开始失去工作,这意味着他们也将失去房子。”他说道,“我们习惯于认为,经济衰退是由短期冲击造成的。但这一次的冲击不仅会持续一段时间,还会产生长期的影响。令人震惊的是,各家机构仍然在发出温和的GDP下行预测。因为他们不想拉响警报引起恐慌。”
“出现萧条的可能性相当高了,”罗格斯大学的美林表示——事实上他认为可能已经进入萧条了。虽然经济刺激计划将“在一定程度上减缓衰退,”但要真正改变经济航向,就必须得应对好并控制住疫情,然后逐渐恢复人们对经济的信心。“只要人们对去商场、杂货店或者理发店,就有得重病甚至死亡风险,这种恐惧一天未能消除,经济就一天不复苏。”他说。
如何避免经济萧条的风险
布利茨说,美国要避免经济萧条,必须做到三件事。
首先,美联储必须尽其所能确保“信用风险传染不会蔓延到整个经济体系。”美联储已经采取了许多2008年金融危机以来从未采取过的非常规举措,希望这些举措会让全球金融体系保持正常运转。然而,要是再叠加流动性问题,美联储可能会无计可施。
其次,联邦政府需要有合适且规模够大的财政应对措施。2万亿美元的经济救助计划固然庞大,但布利茨认为这可能不是上上策。“给民众发钱花的问题在于,你还得权衡社交疏远措施对人们消费支出的抑制。”布利茨说到,“我宁愿政府先给所有非国防政府机构提供1万亿美元的经费。”
布利茨说的第三点是最大的问题,即经济活动停摆需要尽快结束。“要尽早停止实施这种社交疏远措施,政府必须意识到,这件事不能拖到6个月乃至12个月才完成。”他说,“接着,他们必须鼓励人们多外出,恢复往常的生活。政府一旦掌握了这种让一切停摆的权力,就不愿轻易放弃。”
美国总统特朗普称希望最早在4月底结束隔离,但政府所使用的数学模型显示,社交疏远措施可能至少要持续到5月底。这就会加剧经济问题。
因为,正当科学家们努力地在新冠病毒治疗和疫苗方面取得进展之时,经济学家们仍在苦苦寻找可使经济走出萧条的灵丹妙药。(财富中文网)
译者:万志文
又一项让经济预测家惊叹的数据出炉:上周美国申请失业救济的人数达到创纪录的660万人。牛津经济研究院在电子邮件中称,该项数据的“跳涨实在不可思议”,而且还可能成为“新常态”。中间市场审计与咨询公司RSM首席经济学家乔·布鲁苏拉斯撰文称,这种“结构性变化”意味着“实时失业率至少有10.1%。”
当下,全球范围存在着太多的不确定性,经济预测家前脚刚发出自己的预测,后脚就要进一步下调那些预测。短短几周内,高盛便已经数次下调美国第二季度GDP增长预测:从–2%调到–24%,再调到–32%。
从种种预测来看,经济衰退显然会到来,还可能是非常严重的衰退。但是,鉴于形势瞬息万变,美国经济有没可能不只是衰退,而是走向萧条呢?
《财富》与10位经济学家和金融市场专家讨论了这一问题。目前,他们大多认为美国经济衰退基本板上钉钉。至于是否会严重到经济萧条的地步?他们之间有极大的分歧。
毕竟,根据美国国家经济研究局的数据,自1900年以来的22次经济衰退中,只有一次严重到称得上“大萧条”。十九世纪前则有过四次大萧条。
现在似乎有两个阵营。一个阵营认为,经济基本面大体上是稳健的,几乎无法想象会出现萧条。另一个阵营认为,萧条是大概率事件。
经济萧条的定义是什么?
经济衰退通常被定义为连续两个季度出现GDP负增长,而经济萧条则没有一个统一的定义。
由于没有一个官方的定义,经济学家们有着多种不同的定义版本。据佛罗里达国际大学金融学教授、金融系主任拉希德·哈米德称,有的经济学家认为,“经济萧条,就是连续两年或以上出现GDP下滑。有的认为是连续两年GDP下滑幅度超过10%。也有人认为是连续两年失业率超过10%。”
还有一些经济学家倾向于从对比的角度来看待这一问题。乔治梅森大学商学院金融学副教授德里克·霍斯特梅尔表示,“有的人说,出现一年严重的经济萎缩就算萧条。有的人则将时限拉长一些。”
甚至还有一个问题是,是否必须所有人都同时陷入经济麻烦,才算得上经济萧条。“有的社会阶层深陷经济泥沼(萧条),有的阶层则从别人的困境中得到滋养,过着奢华的生活,这种情况是有可能发生的。”经济学家迈克尔·美林指出,“传统的美国中产阶级从1970年代中期就清楚知道这种情况,非裔美国人甚至知道得更早。这种问题的影响,在每一项常见的健康、经济和社会福利统计数据上都会明显显现出来。”美林是罗格斯管理与劳动关系学院专业实践教授兼劳动教育行动研究网络主任。
又或者,正如投资银行公司Cassel Salpeter & Co联合创始人兼董事长詹姆斯·卡塞尔所提到的那句俗话所言,“邻居失业了是经济衰退,自己失业了就是经济萧条。”
与衰退一样,萧条通常也是经济数据出炉以后才能事后诊断。但到那个时候,事情通常都已经发生了,而不是正在发生,这一点要不同于美国生活许多其它的方面。
“我们实际上掌握了主流广播节目每分钟的听众数据,”威奇塔州立大学巴顿商学院国际商务特聘讲座教授、管理学教授兼国际商务发展中心主任乌沙·哈利指出,“我们知道谁会去购买产品,会发生什么。而这一次,我们头一回没有做出预测所需要的那些经济数据。”经济形势变化太快也太大了,以至于预测家根本无法根据最近的模式建立预测模型。
哈米德说,“这种(涉及疫情的)情况非常罕见,经济学家没有办法建立良好的模型来预测经济复苏会是什么样的。”
经济学家衡量GDP的方式也存在一个固有的问题。他们通常是关注季度之间的变动,然后据此估算年度增长率。例如,预测说第二季度GDP将下跌32%,它就意味着,假定第一季度和第二季度之间的变动幅度维持一整年,那么这一年的全年GDP也将下跌32%。
这对于外行人来说可能不大好理解。“按照季度环比计算的方式,如果第一季度经济大幅下滑,第二季度也出现同样的下滑幅度,那么经济增长为零。”TS Lombard首席美国经济学家史蒂文·布利茨指出。经济学家和媒体提到的增长率一下子就变成0%,听起来比下跌32%要好得多,但情况仍然很糟糕。
鉴于所有的这些因素,美国经济是否正走向萧条,实在很不好判断。
乐观派
在乐观派看来,美国经济跌得有多快,反弹就有多快。他们给出的论据包括,疫情爆发前美国经济整体表现强劲,疫情并不涉及经济本质,以及一旦人们的工作和生活恢复正常,疫情期间被抑制的消费需求会彻底爆发的推论。
佛罗里达国际大学的哈米德等人认为,鉴于疫情危机爆发前美国经济向好,出现萧条的“可能性非常非常低。”威奇托州立大学的哈利表示认同,“我们处在漩涡的最中心,我们在战斗。疫情一旦结束,我们就会收复失地。”
威斯康星大学密尔沃基分校经济学教授昆丹·基肖尔在发给《财富》的电子邮件中称,经济萧条的可能性只有“百分之一”。他认为可能会出现两种情况:一是经济暂时大幅下滑,但第三季度和第四季度迅速复苏;二是如果疫情在秋季重新爆发,会出现“双底型衰退”。
在卡内基梅隆大学泰珀商学院经济学教授塞文·耶尔特金看来,如果经济下行发生,并持续数月,那么情况会更严峻。“但是,如果我们能够重启经济活动,哪怕只是非全面的重启,资本都不会被摧毁,”她说道,“就业岗位也不会被大量摧毁。复苏应该会很快,因而不会有什么风险。”
“经济活动的收缩是疫情导致的,迫不得已的,因此日后能够恢复过来。所以说,这一次与往常因为政策失误演变成萧条的经济衰退大不相同。” TS Lombard的布利茨说道。
悲观派
还有另一种观点。“现在大多数经济模型都显示,第二季度失业率将高达25%到30%,”乔治梅森大学教授霍斯特梅尔更多地从经济萎缩的程度而非持续时间来谈,“当前传出的数据真的非常糟糕。这些预测比大萧条时期的任何情况都要糟糕。因此,我们当然可以称之为萧条,即便它只是持续一两个季度。”
约翰斯·霍普金斯大学凯瑞商学院金融学副教授亚历山德罗·雷布奇利用能源使用、交通模式等间接的经济活动指标展开了研究。他也强调,其研究结果显示,此次经济萎缩相当严重。“此次衰退带来了巨大的挑战,而且可能会持续更久,进一步恶化,甚至可能会变得比2008年至09年的大衰退还要严重。那次大衰退持续了六个季度,失业率达到10%。”他说,“目前有些估算说,这一次可能要严重两到三倍,比大萧条时期还要糟糕。”
雷布奇还指出,瀑布效应将会蔓延到整个经济。“人们将开始失去工作,这意味着他们也将失去房子。”他说道,“我们习惯于认为,经济衰退是由短期冲击造成的。但这一次的冲击不仅会持续一段时间,还会产生长期的影响。令人震惊的是,各家机构仍然在发出温和的GDP下行预测。因为他们不想拉响警报引起恐慌。”
“出现萧条的可能性相当高了,”罗格斯大学的美林表示——事实上他认为可能已经进入萧条了。虽然经济刺激计划将“在一定程度上减缓衰退,”但要真正改变经济航向,就必须得应对好并控制住疫情,然后逐渐恢复人们对经济的信心。“只要人们对去商场、杂货店或者理发店,就有得重病甚至死亡风险,这种恐惧一天未能消除,经济就一天不复苏。”他说。
如何避免经济萧条的风险
布利茨说,美国要避免经济萧条,必须做到三件事。
首先,美联储必须尽其所能确保“信用风险传染不会蔓延到整个经济体系。”美联储已经采取了许多2008年金融危机以来从未采取过的非常规举措,希望这些举措会让全球金融体系保持正常运转。然而,要是再叠加流动性问题,美联储可能会无计可施。
其次,联邦政府需要有合适且规模够大的财政应对措施。2万亿美元的经济救助计划固然庞大,但布利茨认为这可能不是上上策。“给民众发钱花的问题在于,你还得权衡社交疏远措施对人们消费支出的抑制。”布利茨说到,“我宁愿政府先给所有非国防政府机构提供1万亿美元的经费。”
布利茨说的第三点是最大的问题,即经济活动停摆需要尽快结束。“要尽早停止实施这种社交疏远措施,政府必须意识到,这件事不能拖到6个月乃至12个月才完成。”他说,“接着,他们必须鼓励人们多外出,恢复往常的生活。政府一旦掌握了这种让一切停摆的权力,就不愿轻易放弃。”
美国总统特朗普称希望最早在4月底结束隔离,但政府所使用的数学模型显示,社交疏远措施可能至少要持续到5月底。这就会加剧经济问题。
因为,正当科学家们努力地在新冠病毒治疗和疫苗方面取得进展之时,经济学家们仍在苦苦寻找可使经济走出萧条的灵丹妙药。(财富中文网)
译者:万志文
Another day, another surprise for the economic forecasters: a record 6.6 million people filed for unemployment last week. Oxford Economics in an email called it an "incomprehensible jump" that may be "the new normal." Joe Brusuelas, chief economist for middle market audit and advisory firm RSM, wrote that such "tectonic shifts" imply a "real-time unemployment rate of 10.1% at a minimum."
There is so much uncertainty in the world right now that economic forecasters are downgrading their predictions almost as fast as they can make them. Within a few weeks, Goldman Sachs downgraded its second quarter GDP estimates from –2% to –24% to –32%.
Predictions are pretty clear that a recession, and maybe a very bad one, is in the offing. But given how quickly the situation is changing, is there a chance the country is heading for a depression?
Fortune discussed the issue with 10 economists and financial market experts. Most at this point consider a recession essentially a given. And a depression? That's where opinions start to diverge wildly.
After all, out of the 22 recessions since 1900, according to the National Bureau of Economic Research, only one was dire enough to warrant such a title: the Great Depression. There had been four in the preceding 19th century.
Right now there appear to be two camps. Those in the first say economic fundamentals have been essentially sound and that a depression is almost unthinkable. The other group says that a depression is very much a possibility.
What is a depression?
Unlike a recession—two consecutive quarters of negative GDP growth—there is no compact universal definition of a depression.
Absent an official definition, economists have a variety of working ones. According to some, "in a depression, you have to have a decline in GDP of two or more years," said Shahid Hamid, professor of finance and chair of the finance department at Florida International University. "Another is if the GDP decline is greater than 10% [for two years]. A third is if unemployment is more than 10%," again for two years.
Then there are economists who take a more relative approach. "Some people say it has to be a year [of severe economic contraction]," said Derek Horstmeyer, an associate professor of finance at the George Mason University School of Business. "Some people push it further."
There is even a question as to whether it must be obvious to everyone at the same time. "It is possible for one sector of a society to be trapped in an economic trough—a depression—while another sector is feeding from the trough and living the high life," said Michael Merrill, an economist, professor of professional practice, and director of the Labor Education Action Research Network in the Rutgers School of Management and Labor Relations. "Traditional Middle America has known exactly such a situation since the mid-1970s, and African-Americans have known it for even longer. The effects are evident in every health, economic, and social welfare statistic one might want to consult."
Or, as goes the old saying that James Cassel, cofounder and chairman of investment banking firm Cassel Salpeter & Co., mentioned: "When your friend's out of a job, it's a recession. When you're out of a job, it's a depression."
As with recessions, depressions are typically diagnosed in retrospect, after the data is in. But that typically comes after events have happened and not as they are occurring, unlike in many other aspects of American life.
"We actually have data for minute-by-minute listeners to major radio shows," said Usha Haley, W. Frank Barton distinguished chair in international business, professor of management, and director of the Center for International Business Advancement of Wichita State University. "We know who's going to buy products and what's going to happen. Here, for the first time, we don't have [the economic data we need to forecast]." The changes are so swift and large that forecasters can't build projections from patterns in the recent past.
"This [pandemic] scenario is very new, and economists don't have a good model to predict how the recovery would be," Hamid said.
There is also an inherent issue in how economists measure GDP. They usually look at change between quarters and then project that out into an annual growth rate. When a forecast projects that GDP will be –32% in the second quarter, it's really saying that if the change between the first and second quarter kept up all year, it would be like losing 32% of GDP over that year.
That can get confusing for a lay audience when trying to understand the state of things. "The way the quarter-over-quarter math works, if it goes down a lot in quarter one and it stays at that low level of activity in quarter two, [the rate is] zero," said Steven Blitz, chief U.S. economist of TS Lombard. Suddenly the rate economists and the media mention is 0%, which sounds far better than –32%, but it means things are still as bad.
Between all these factors, trying to pinpoint whether we're heading for a depression is extremely difficult.
The optimists
The optimists, if you can call them that, cite a basically strong economy, the noneconomic nature of the pandemic, and the presumption of pent-up demand once things are back to normal as evidence that as quickly as we fell into this hole, we can pull out of it.
Florida International University's Hamid is among those who think a depression is "very, very unlikely" given the economy's performance coming into the crisis. Haley at Wichita State University agreed. "We're in the center of it all," she said. "We're on the battlefield. Once that is over, we will recoup."
In an email to Fortune, Kundan Kishor, a professor of economics at the University of Wisconsin–Milwaukee, saw a depression as only a "one out of 100 chance." He sees two potential likely scenarios. One is a large drop in the economy and rapid recovery in the third and fourth quarters. The other is a "double-dip recession" if the pandemic reemerges in the fall.
If an economic fall happens and continues for months, the situation becomes more grave, thinks Sevin Yeltekin, a professor of economics at Carnegie Mellon University's Tepper School of Business. "But if we can restart, even a staggering restart, we're not really destroying capital," she said. "We're not destroying labor. The ramping up should happen quite quickly," putting danger at a distance.
"When you recognize that the contraction of economic activity was imposed [as a response to the pandemic] and therefore can be lifted, that makes this very different from your plain-vanilla ordinary recession in which policy missteps turned into a depression," explained TS Lombard's Blitz.
The pessimists
And then there is the other view. "Most economic models now point to a 25% to 30% unemployment rate in Q2," said George Mason's Horstmeyer, who focuses more on the degree of contraction and not the length. "The numbers we're seeing trickling in are very bad. This projection is worse than anything we saw in the Great Depression. So we can certainly call this a depression even if it only lasts for a quarter or two."
Alessandro Rebucci, an associate professor of finance at the Johns Hopkins Carey Business School, also stressed the depth of the collapse that his research shows using current indirect measures of activity, like energy use and traffic patterns. "This [recession] poses formidable challenges and could be more prolonged and more severe, possibly worse than the Great Recession of 2008 to ’09, which lasted six quarters and saw the unemployment rate reaching 10% of the labor force," he said. "Current estimates put it at two to four times as severe, making it more profound than the Great Depression."
Rebucci also points to cascading effects that will stretch through the economy. "People will start to lose jobs, which means they will lose houses," he said. "We're used to thinking of recession driven by shocks that are short-lived. This is not only a shock that will last a while but will have long-term effects. What is shocking is that institutions continue to forecast moderate output declines, which has to do with the fact that they don't want to sound the alarm."
"The odds of a depression are quite high," says Merrill of Rutgers—in fact he thinks we might already be in one. While the stimulus packages will "slow the decline somewhat," changing the direction of the economy means addressing the pandemic and bringing it under control, and then restoring confidence afterward. "As long as people remain afraid of getting deathly ill and maybe dying every time they go to a mall, grocery store, or barber shop, the economy will not recover," he said.
Avoiding the danger
For the U.S. to avoid a depression, says Blitz, three things must occur.
First, the Federal Reserve must do everything in its power to ensure that "credit contagion doesn't cascade through the system." The Fed has taken many extraordinary steps not seen since the 2008 collapse, which hopefully will keep the global financial systems operating. If there are additional liquidity problems, however, the Fed may have reached the end of its options.
Second, the federal government needs a large enough fiscal response of the right type. The $2 trillion aid package is enormous, but Blitz thinks it may not offer the best approach. "The problem with giving people money to spend [is that] you have to be balancing that against the fact that you have social distancing rules preventing people from spending money," Blitz said. "I'd rather them front-load a trillion dollars of spending by all the various nondefense government agencies."
The biggest question is Blitz's third point—that the shutdown of activity needs to end quickly. "You need to stop the imposition of social distancing sooner [rather] than later, and government has to realize that the lifting of this can't be a six- to 12-month process," he said. "Then they have to encourage people to go out and live their lives. Once government takes this power to shut things down, they're very reluctant to give it up."
Although Donald Trump has said that he'd like to end isolation by the end of April at the earliest, the mathematical models the administration is using suggest that social distancing may have to continue through at least May. And that aggravates the problem.
Because while scientists are working to make strides on treatments and vaccines for coronavirus, economists are still searching for their magic bullet: a way to bring an economy out of a depression.