Olivia Álvarez (Monex Europe) | The EU, a significant laggardin Q1, starts to rise from the ashes. With below 10% of the total population having received at least one jab by the end of March, the European Commission entered negotiations with main suppliers to ramp up deliveries. As a result, the EC set ambitious goals to have 70% of the EU adult population vaccinated by the end of June, which accounts for 55%-60% of the total EU population.
Pablo Pardo (Washington) | We don’t know yet what will happen but, for the moment, it is clear that the fact that China has apparently been able to contain the pandemic better than the US or much of the EU will considerably strengthen that country’s political appeal and capacity for influence. The loser, for the moment, is the West. The economic damage was inevitable. But the political damage, for example in the US, due to the lack of preparation and the scant attention paid to experts, could have been much less…
Spain had its first coronavirus death on February 13th, in Valencia. But the Spanish Ministry of Health did not know about it, or did not make it public – and we do not know what is worse – until three weeks later, March 3. This first data reflects well how this pandemic is being managed in Spain.
Joan Tapia (Barcelona) | We don’t really know where we stand with regard to this crisis, but it’s clear what we should do. The EU must act decisively to avoid an economic disaster that would affect all its members. Only God knows what will come next.
As the latest OECD simulations rightly point out, the area where there is really room for maneuvering is that of fiscal policies and structural reforms. According to the international organization, in the short term and under a scenario of coordination in the G-20, the aforementioned measures could add up to nearly 0.5 percentage points of GDP in the first year with respect to the central scenario, as opposed to nearly 0.15 percentage points of monetary policy.
Ives Bonzon (Julius Baer) | When the circumstances we face become extreme, the temptation to panic is great. As Daniel Kahne-man, the great psychologist and Nobel Prize – winning economist for his work on choices and decisions, explained, the human brain is subdivided between a fast brain focused on the risks to our survival and a slow brain useful for grasping complex problems. The pandemic scenario touches us emotionally at the heart of our most precious asset, our survival. Nevertheless, more than ever, it is crucial to apprehend the situation with our slow brain.
Nitesh Shah, (Director, Research, WisdomTree) | “Nassim Taleb in his book on uncertainty defined “Black Swans”— extremely unpredictable events that have massive impacts on human society. One of the defining elements of Black Swans is that models can explain their existence after the fact. In September 2019 a report compiled at the request of the United Nations secretary-general said “If it is true to say ‘what’s past is prologue’, then there is a very real threat of a rapidly moving, highly lethal pandemic of a respiratory pathogen killing 50 to 80 million people and wiping out nearly 5% of the world’s economy.
Equity markets tumbled worldwide following the wide spread of the coronavirus epidemic beyond China. European stocks dropped most since 2016, with Italy’s MIB index dropping 5.43%, while the declines were more contained in Asia. Elsewhere, implied volatility increased further (VIX 23+6 points).