10/10/2020 – Government support programs and an extremely expansive monetary policy continue to dominate the current economic trend. Only once the state subsidies phased-out and economies resume more market-based structures, will it be possible to assess more reliably the impact of the pandemic on the future course of the economy. Only then will the development of corporate debt, the volume and severity of bankruptcies, and their impact on the banking system become visible. It will be decisive as to how quickly unemployment will fall and how strongly government tax revenues will recover, which most likely are to be offset by significantly higher social costs.
Read more in the Macroeconomic Comment by Peter von Elten, Macro Consultant at Belvoir Capital AG.