Early economic indicators all point in the same direction: south – and firmly so. We are in for some tough times, even if Switzerland is comparatively well-prepared to withstand the crisis.
It isn't easy to detect a piece of good news in the avalanche of bad news about the state of the world economy. Presumably, because there are hardly any success stories – but that's for a little later. All in all, there is something in the air that almost nobody will have seen the likes of.
These are times for dramatic statements. One such came courtesy of Chris Rupkey, an economist at MUFG bank: «At this point it would take a miracle to keep this recession from turning into the Great Depression II . . . What are stock market investors thinking? Investors should be running for their lives. We are doomed. Bet on it.»
Direction Evident, Distance Not
Pictures befitting the messages of panic are easy to find. In Paris, poor people queue hundreds of meters around a block to receive food aid. In England and the U.S., stories emerge of how many more African-Americans people succumb to the disease than white people. Food for very somber thoughts for sure.
And the figures match the pictures. We are basically discussing whether the drop will be like the one during the 1970s oil price shock or rather, as Rupkey suggested, whether we are heading straight towards the «Great Depression II».
The Worst in 45 Years
Of course, the honest answer to this question about the depth of the crisis is: we don't know. First of all, we know hardly anything about the virus. Apart from its infectiousness, that it kills a great many people, and that we have neither cure nor vaccine available.
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