Realist, not conformist analysis of the latest financial, business and political news

Richard Murphy’s Coronavirus Prediction

A Richard Murphy

Richard Murphy – formerly Senior Lecturer at Islington Technical College – tells us that the British economy will suffer from the coronavirus to the same extent that it near fell over in 2008.

Rishi Sunak would be wise to consider all such measures. But he needs to do something much more than that. He needs to prepare for government deficits on the scale of 2008 to 2010, because the chance that they are going to happen is very high. There are three reasons for saying so.

Well, there’s his prediction.

A 5 or 6% fall in UK GDP. Leading to 10% of GDP budget deficits:

No, I don;t think so either. I expect this all to be over very quickly. Partly because China’s already recovering, partly because we’re arriving at the Northern Hemisphere spring and therefore the summer in which ‘flu viruses don;t thrive and partly because disease just isn’t that important to an economy.

But let’s just take this as a marker from the Sage of Ely and see what happens, shall we?

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Boganboy
Boganboy
1 year ago

I do agree with you. Maybe white haired old bastards like me are a bit at risk. But I don’t really expect society as a whole to notice a bad flu season.

Spike
Spike
1 year ago

Does he define “very high” odds? Or are definitions superfluous when you are agitating for government activism?

Michael van der Riet
Michael van der Riet
1 year ago

Well he’s put his cock on the block. Let’s see him worm his way out of this one.

Phoenix44
Phoenix44
1 year ago

As I understand from various doctors coronavirus is not like flu and will not recede as we exit winter. So far its death rate has been higher too, by quite some way. Its interesting to look at proxies such as coal usage in Chinese power plants, which show no recovery from the lows associated with Chinese New Year and suggest economic activity is 20% down or more.

We will see, and hopefully it will be nothing much.

Leo Savantt
Leo Savantt
1 year ago

Either this is or isn’t a truly damaging pandemic, time will tell. Theoretically it could be a 21st C Black Death but more likely it isn’t. However, one day the chances of a modern day plague that kills millions upon millions is likely, such is the nature of biology. Personally I refuse to panic, for in panic there is a great deal of harm. So I will just KBO and hope and expect that others will do the same.

Ben S
Ben S
1 year ago

Panic about coronavirus could have this effect, even if the virus itself doesn’t.

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