David Ndii illustrates where the economy may be headed post COVID19

[KenyanPlato]

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We are looking at a growth of minus 3 percent. He believes that once the restrictions are lifted the urban areas will start emptying a those venurable workers seeking safety in the rural areas. It is an interesting article and it does summarize what other economists around the world are seeing or predicting. I actually did my budget the other day and realized I have  4 years of reserves before I go broke

https://www.theelephant.info/op-eds/2020/04/16/memo-to-upperdeckpeopleke-coronavirus-economic-shock-is-coming-and-it-has-your-names-on-it/

My advise on those in N America
Stop paying any consumer debt
Preserve all cash and reduce your spending




four-month disruption scenario, i.e. to July, works out to a contraction of Sh1.56 trillion. But, of course, the economy will not bounce back immediately, so if we factor in a 50 per cent recovery to December, it goes up to Sh2.3 trillion, which is in the order of 20 per cent of nominal GDP (i.e. before inflation adjustment). Roughly, a one percentage point in nominal GDP translates to 0.4 per cent real (i.e. inflation adjusted) growth, the figure that is normally reported as the annual economic growth rate of between 4 and 6 per cent in recent years. A 20 per cent nominal GDP contraction thus translates to an eight percentage points drop in real GDP growth, which takes us into negative three per cent territory. We have no precedent of an economic shock of this magnitude to compare with. This is the situation unfolding the world over. Sixteen million people, 10 per cent of the US workforce, have lost their jobs in less than a month. The Penn Wharton Budget Model, a Wharton Business School fiscal policy analysis project, estimates that even with the mammoth $2.2 trillion stimulus, the economy will still shrink by 30 per cent in the second quarter. If borne out, it will be the largest quarterly contraction since World War II. With no end in sight, the language has changed from recession to depression. Last week the Canadian government recalled parliament and passed a C$73 billion emergency wage subsidy bill, to augment the $103 billion emergency relief package passed a few weeks ago. The first relief package was equivalent to 4.4 per cent of GDP. This increase takes it up to 7.5 per cent. Such was the sense of urgency that the bill was processed by both houses on a Saturday afternoon, and signed into law at 9.30 p.m. that same night. I am still hopeful that we will dodge the pandemic bullet, or that if it does hit, it will not be cataclysmic. But the economic consequences are inescapable. As this column has observed, the epidemiological and economic dynamics of the pandemic have decoupled. The economy is being ravaged by our self-preservation instinct. The economy thrives on venturesome behaviour—the willingness to trade risk for reward. But seldom is this trade-off a life and death issue—although to be sure some people, gangsters for example, do take life and death risks to make a buck. For the overwhelming majority, making a living is not life threatening. The coronavirus is making it so. We do not know how long it will be before venturing into nightclubs, huge weddings, spectator sports and international travel becomes routine again.

Read more at: https://www.theelephant.info/op-eds/2020/04/16/memo-to-upperdeckpeopleke-coronavirus-economic-shock-is-coming-and-it-has-your-names-on-it/
The Elephant - Speaking truth to power.

[veritas]

I think people are much more resilient and more likely to return to routine. Routine is a difficult habit to disrupt. A blind spot I noticed with economists is their lack of regard for the human element which often dictates mass movements to or away from the next big thing. For instance, something going viral, how well have economists predicted cats doing so well over dogs ?

[KenyanPlato]

I think people are much more resilient and more likely to return to routine. Routine is a difficult habit to disrupt.

yeah but there is no routine to return to. I have been excercising at our abandoned Mall which is 4 miles from my house. Do you know that freaking Mall is 4 miles to go around all buildings. only 5 eateries are partially open, target and costco .. All the other stores are locked.. most of these businesses will file bankruptcy and actually two of the biggest retailers in this mall have filed for bankruptcy and will likely close the two stores. THis mall spent 300 million dollars a few years ago to emerge from bankruptcy. it added a whole new fashion district, that now is gone and the mall will likely go into bankruptcy too..

[gout]

Some things are very personal and so will be the effects of corona - health, social, economical and political. I am still running up and down despite 350k deaths. Many will fall by the wayside never to recover but humans will be wiser, better and stronger!!

Health wise more people will become obese with stay at home and no exercise but in the long run as corona takes those with such conditions healthier lifestyles will take root. With reforms at WHO and exposure of Gates grip on public health we are likely to see better hospitals in Africa which have been replaced by vaccines and more vaccines.

Technology will widen inequalities as it becomes clear that shithole nations need food which requires dirty work. With people moving back to the villages with urban experiences and network farming in Africa will get a major human capital boost- rural economies are rising with corona movement restrictions as people sell to neighbours and nearby locked towns.

Lower rents are a rational economic decision by landlords which will be appreciated by people tired of this working from home chorus. I expect to see malls in Kenya also turn to stalls for broke micro enterprises. Having some of these premises empty is very expensive as you have to continue paying for utilities. 

People are learning new skills everyday. I saw a joke that sugar mummies are selling vegetables and eggs by the roadside like other hustlers.

[RV Pundit]

The bigger issue is to deal with uncertainty. Without knowing how things will pan out - gov, you, me, organization, cannot really plan anything. You don't even know if it makes sense to re-open only to close a month or two later.

Until there is clarity on when and how this will end - we are not going back to normal soon. Economies will crash. The government will collapse. Companies will go under. Poverty will become the new normal for many people.

If it was a big earthquake or tsunami - that came and passed - we would focus on recovery - but now - everyone will be on their tenterhooks and living basically day today. The most optimistic plans are now 3 months long.

Until a vaccine is discovered or herd immunity renders it tame - we are for a long ride.

The great thing - many people have come to realize they can survive in-doors - they can work from home - they can live without all the hustle and bustle - so if this continues for longer - the current way of living will change - and for the better. People will stay with their families a lot more. Most offices will embrace telecommuting. What we thought was impossible will become possible.

And generally, we will be healthier - already hospitals are closing down - for lack of patients - as people are sanitizing and keep distance like crazy. While trying to avoid CORONA - we are riding a lot more diseases. This is especially true in places like Africa where 90% of hospitalization are due to poor hygiene.

[Kim Jong-Un's Pajama Pants]

The bigger issue is to deal with uncertainty. Without knowing how things will pan out - gov, you, me, organization, cannot really plan anything. You don't even know if it makes sense to re-open only to close a month or two later.

Until there is clarity on when and how this will end - we are not going back to normal soon. Economies will crash. The government will collapse. Companies will go under. Poverty will become the new normal for many people.

If it was a big earthquake or tsunami - that came and passed - we would focus on recovery - but now - everyone will be on their tenterhooks and living basically day today. The most optimistic plans are now 3 months long.

Until a vaccine is discovered or herd immunity renders it tame - we are for a long ride.

The great thing - many people have come to realize they can survive in-doors - they can work from home - they can live without all the hustle and bustle - so if this continues for longer - the current way of living will change - and for the better. People will stay with their families a lot more. Most offices will embrace telecommuting. What we thought was impossible will become possible.

And generally, we will be healthier - already hospitals are closing down - for lack of patients - as people are sanitizing and keep distance like crazy. While trying to avoid CORONA - we are riding a lot more diseases. This is especially true in places like Africa where 90% of hospitalization are due to poor hygiene.

I have noticed this effect too.  Fewer people around me have sniffles.  I normally deal with an allergy or two around this time, but so far, nothing.  I suspect we normally pick up germs from all over the place when there is no pandemic.