The fallout from the Covid-19 coronavirus epidemic is multiplying as the most affected countries gradually reopen their economies.
While S&P Global already identified 24 major companies which have fallen from “investment grade” to “speculative grade” with a cumulative debt of around $300 billion, every word of Fed Governor Jerome Powell is being scrutinized as never before.
In an interview with 60 Minutes, Powell gave the end of 2021 as a possible starting point for a viable economic recovery in the United States, i.e. a year and a half delay that could be interpreted positively by the stock markets, at least initially.
But uncertainty remains high as to the impact of the States’ management of the pandemic, about which some studies argue that lockdown could be much more damaging to the economy without bringing significantly more positive results in terms of health.
Sweden, for example, would have obtained a mortality rate equivalent to that of the United States, but lower than that of France, Italy and the United Kingdom without opting for lockdown and therefore without similar impact for its economy.
But the damage suffered by the Western economies seems to be lasting, considering that, even if they still have ammunition, central banks and governments are mainly interested in avoiding a surge in business bankruptcies until they can find an effective countermeasure against Covid-19.
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