"there's a good chance things will quickly return to normal - or at least most companies will survive and start rehiring under a new normal." Other than optimism and hope, what is your basis here?
what's happening is the result of a medical emergency and not the economy. There's no financial reason or economic reason the job losses are so high. It's still there, the demand is still there, we artificially halted the economy and that generated the job loss. It's certainly not an on/off situation but the job demand is still there and we can get back to work.
This concept of an economy as some sort of Platonic ideal, disconnected from the processes of the polity in which it exists, is very odd to me.
It seems like having your heart stop and saying it isn't a "real" emergency, because the organs are all still there and ready to get back to work as soon as oxygenated blood starts arriving again. Sure, that's true for a minute or so, maybe two if you're young and healthy. After that...
well take the analogy further, in this case to save the patient's life you have to stop the heart from beating for a time but that doesn't imply the patient has suffered a heart attack.
In that case, the analogy is to open-heart surgery, which typically results in significantly reduced capacity for a long time at best, and often permanently. It's certainly not something you bounce back from quickly or easily, and even if you're young and in perfect physical health, you have to be pretty lucky to come back all the way.
Staying within the increasingly strained analogy, I don't think it is reasonable to describe the US economy as "young" or "in perfect physical health", or indeed even as anywhere close to either of those. This is more like doing an emergency sextuple bypass on an obese 70-year-old with a lifelong pack-a-day habit - even if the patient comes off the table alive, it's going to take a long and careful period of physical therapy and recovery to keep him that way, and he's almost certainly never going to recover all of even the limited capacity he had before the crisis.
Psychology is malleable, and consumption patterns beyond food and shelter are driven largely by psychology. In the great depression, consumption behavior of an entire generation was permanently changed, no matter how much better the economy got. Those mental scars lasted forever.
What percentage of the population will watch a parent, spouse, best friend, or grandparent slowly asphyxiate to death and develop a lifetime aversion to casual dining, tourism, mall shopping, non-business air travel, fast food, staying in hotels, visiting family for holidays, casino gambling, meeting with potential clients, going to class, etc?
And then what are the second order effects of not needing the suits/ties/dresses, jetliner inventory, commercial real estate, gasoline, cruise ships, university buildings, casinos, etc required for the above activities?
Which of the economic sectors predicated on those activities will "bounce back"? What is the current high-yield debt load associated with these sectors?
Or the Great War, famines in Europe and 1918 flu pandemic? Which was followed by the roaring 20's. As to what % of the population will watched a loved one die and then retrench psychologically for an extended period of time? IMO, a very very small percentage. History has seen people suffer much much MUCH worse loss and then bounce back with a vengeance shortly afterwards.
People and societies are not as fragile as many people seem to imagine today. People and societies are, in fact, quite resilient. They can withstand the horrors of war, plague, famine and more. And then bounce back rapidly within a few years. I'm not trying to minimize the sorrow or severity of those that suffer from this pandemic. But relative to past mass trauma, there is little to suggest it's a major turning point in global culture.
Just because the cause of a crisis wasn’t financial, doesn’t mean that it doesn’t trigger a financial crisis. Financial systems are not impervious to medical disasters just because they aren’t financial in nature.
In fairness to the poster, this is the refrain you’d hear from many CNBC hosts all day, political appointees, etc. I’m old enough to remember the same positivity as the financial crisis unfolded, so I try to remind myself that public officials have no incentive to tell the public “the economy is going to be fubar till 2020. Hang on folks.”
In 'fairness' to the poster, if they're relying on CNBC for their perspective, they're idiots unless they're really young and haven't been burned before by the mainstream media's reporting.
