Question

For the past 2 months, the US has experienced the Coronavirus Pandemic. How has the health crisis impacted the financial environment? Explore unemployment, business closure, government bailout and debt. A minimum of 100 words.

Answer 1

Covid 19 has brought the whole world to a standstill. The impact of the pandemic on lives of people around the world has been huge. Not just the health of people are impacted, but the impact of this pandemic on the economy as whole has been huge. Lockdowns and economy standstill for days have brought economies around the world to a huge recession. It is estimated that almost 39 million people have been unemployed in US post the outbreak. More than 2.4 m people have applied for unemployment benefits jn the past 1 week triggered by the layoffs around the nation from business being shutdowns. Federal Reserve Chairman Jerome Powell said that the unemployment rate could peak upto almost 20% to 25% by June, a level unseen since the Great Depression. The nations economy is almost brought to its knees as per the latest statistics shared by the Labor department.

According to World economic forum, The global economy would recover to pre-crisis levels not before the third quarter of 2022 and the US economy would need atleast until the first quarter of 2023 to recover. Among the major industries, the industries that were the hardest hit by COVID19 like the tourism, commercial aerospace, insurance etc may see a relatively slower recovery. The Fed have come up with multiple policies aimed at giving impetus to the economy by pumping more liquidity and hoping to revive the important businesses. The near zero rates are aimed at encouraging banks to provide more funds to economy in order to support businesses and households to cushion the impact of the recession from Covid 19