[PGA]

How is it likely to end, the link below gives most plausible answer,

https://www.livescience.com/coronavi...PZiI_xsOMEVBGc

The difference, how China is dealing with it and US, akin to something the rest of the world is upto. Maybe that is the reason why Shanghai Index is relatively stable.

https://twitter.com/MikeIsaac/status...04080571772928

On the lighter side, I almost feel the morbid pleasure in the fact that rest of the world is feeling the level of uncertainty that a farmer feels on recurrent basis.

The way it looks, there is no denying that we are likely to be in the midst of huge slowdown, many sectors of the economy are going to be badly hit and one candid forecast, food inflation is also likely to go up and it may not be onions this time. From the earnings/savings side average countryman is likely to get badly bruised, perhaps only guys unaffected will be Govt servants .

How fast will we recover in India is dependent on measures the Govt takes and I don't think ours has given any indication of being either surefooted or fleet-footed while dealing with the economic matters.

Stock markets and the state of economy, Benjamin Graham has devoted a chapter on it in his seminal work, and what I infer is that the correlation is purely coincidental in the short run. IMHO only play that bureaucratic mind can conjure up right now is monetary play, which certainly is a big plus for stock markets and wannabe Mallaya's and Nirav's.

[saket77]

Originally Posted by PGA

The difference, how China is dealing with it and US, akin to something the rest of the world is upto. Maybe that is the reason why Shanghai Index is relatively stable.

I didn't went through the twitter URL you have posted but the SSE is relatively stable because of a slew of measures that Chinese Govt. has taken. Biggest of all, they have banned short selling.

https://www.zerohedge.com/markets/co...llapse-re-open

[Samurai]

Caronavirus is our future, it won't go away...

https://www.youtube.com/watch?v=Fqw-9yMV0sI

[GTO]

Spoke to someone at the Mahindra dealership. Footfalls are down by just less than half. Expected to get worse. Corporate buying in March (financial year ending) will help matters a bit, but if things get worse, April will be a bloodbath. Many will lose their shirt.

[PGA]

Originally Posted by V.Narayan

But my belief, maybe wrong, is that in 7 to 8 weeks this pandemic will be in control.

Sir I was wondering about the socio economic impact of the pandemic. With all the malls, cinemas gyms, travel, tourism etc being ordered for closure for how long the staff can expected to be paid. Can such commercial organisations hang on for two months or they will have to fold up. The ramifications for daily wagers and contractual employees seem huge. These guys unfortunately have negligible reserves and constitute huge numbers in our country. There are cases in my area where even the household helps are being laid off.

I think Govt needs to work doubly hard to ensure no unfounded panic sets in the country. Would be keen to know your opinion on this aspect. Thanks and Regards

[whitewing]

Originally Posted by PGA

Sir I was wondering about the socio economic impact of the pandemic. With all the malls, cinemas gyms, travel, tourism etc being ordered for closure for how long the staff can expected to be paid...

Absolutely true! While the virus does not distinguish the socio-economic strata one is n, the first ones impacted due to the side effects of any upheaval/disturbance to normal life will be the poorer sections.

That said, this may turn out to be the trigger for India to showcase itself as the plan-B for manufacturing in China. which in turn can lead to better economic prosperity. I'm sure all major companies would now be looking at risk mitigation. Hopefully the Govt. plays this well.

[Sawyer]

Originally Posted by PGA

Sir I was wondering about the socio economic impact of the pandemic. With all the malls, cinemas gyms, travel, tourism etc being ordered for closure for how long the staff can expected to be paid. Can such commercial organisations hang on for two months or they will have to fold up. The ramifications for daily wagers and contractual employees seem huge.

I have two entrepreneurs in my family that are in hand to mouth businesses that people in corporates tend to think themselves not to be in - customer collections are used to meet the monthly payroll. Both are in distress because of anticipated business contraction to unviable levels already. Both cannot meet more than the March payroll. Both are trying to see what to do to help the pain by paying something in April and something in May - and not even a percent of salary because food costs the same for all, but a total affordable amount from personal savings, divided by the number of employees. But from June, zero.

And the corporate insulation from such consequences may last for a couple of months more, that's it.

Add to that zero social security for all the employees who are also hand to mouth.

I know a economist of about 70 years age who, for the first time in his life, is extremely scared, because like people with an underlying condition, recent events like demonetisation and the low levels of job creation, have left an already not robust economy with underlying conditions that make it very vulnerable to the economic effects of the actions combating the virus.

We may be better off accepting the 1 or 2 percent fatality risks from the virus and getting back to business as usual to the extent possible if there is no other alternative after a couple of months of such killer remedies.

[Guna]

Coronavirus is also turning out to be a boon (may be unintended) for some businesses like remote collaboration tools (Zoom), online streaming (Netflix), online shopping etc. There have been numerous small companies producing some unbranded sanitisers and masks and making hay while the sun shines.
Once there is some kind of breakthrough for the vaccination, some pharma companies are going to make fortunes.
With regards to the loss for the businesses, some of them are very obvious like the travel industry, holiday industry, physical retails, restaurants etc but some
of the impact is happening at places we may not realize. For example, I know folks who are stopping newspapers. I know folks who have decided to put off repair work at home as they don't want a stranger to come in to the house. Today, Bangalore roads were as deserted as they would be if there was a curfew imposed.
When I went to the office on Friday, the cafeteria had only about 10% of the normal crowd for lunch. With the bulk of the folks working from home, it is a huge loss to the catering and transportation agencies. But I am sure the consumption of data and talk time would have increased multiple fold and the telecom service providers are benefiting. Similarly, there could be huge slide in the petrol and diesel prices as people are not commuting much.

[bluevolt]

How bad IT industry is going to affected in the current situation? This is appraisal season currently in progress and companies now have a good reason (excuse even for some) to not to give any hike this year (peanuts if at all they give).

This will ultimately going to affect economy as people would be putting off purchases, travels and what not.

[headbanger]

Originally Posted by bluevolt

How bad IT industry is going to affected in the current situation? This is appraisal season currently in progress and companies now have a good reason (excuse even for some) to not to give any hike this year (peanuts if at all they give).

This will ultimately going to affect economy as people would be putting off purchases, travels and what not.

It's not going to be a very popular option but at this juncture, if the organizations are just able to sail through the rough waters and not downsize, employees should be satisfied with that. The extent of economic damage that this episode is doing will start reflecting in days to come and every organization will have to take a call basis the numbers on P&L sheet. Consumption is going to get hit at macro level and there are no two thoughts about that.

On the other hand, there will be opportunities for upskilling in IT particularly if the incoming projects stream runs dry.

[Thermodynamics]

Originally Posted by whitewing

That said, this may turn out to be the trigger for India to showcase itself as the plan-B for manufacturing in China. which in turn can lead to better economic prosperity. I'm sure all major companies would now be looking at risk mitigation. Hopefully the Govt. plays this well.

Bang on, I was reading a recent McKinsey report on Indian industry forecasts, you have said exactly what has been highlighted. Trade war with China, has made India a potential alternate for investment. Most of these investors are long term, for example, chemical industries develop on a forecast of 15-20 years. What we need is legal assurance for investors from a long time perspective. Another factor that is running in our favor is weak crude price since 2015.

Things that plague our growth are mostly internal : Weakness in Law enforcement, policy instabilities, social instabilities, dishonoring of agreements/ timely resolution of disagreements etc.,

[V.Narayan]

Originally Posted by PGA

Sir I was wondering about the socio economic impact of the pandemic. With all the malls, cinemas gyms, travel, tourism etc being ordered for closure for how long the staff can expected to be paid. Can such commercial organisations hang on for two months or they will have to fold up. The ramifications for daily wagers and contractual employees seem huge. These guys unfortunately have negligible reserves and constitute huge numbers in our country. There are cases in my area where even the household helps are being laid off.

I think Govt needs to work doubly hard to ensure no unfounded panic sets in the country. Would be keen to know your opinion on this aspect. Thanks and Regards

PGA, as always you pen down insightful and thought provoking posts. Yes, you are right that these decisions to shut down malls and cinemas can lead to loss of jobs if it lasts beyond 4 or 5 weeks at the most. Small businesses have almost no margin for extra costs. These bans have this far been for a few weeks. Hopefully they won't last. Fingers crossed. Unfortunately our bureaucracy thinks in terms of bans, limits, quotas, permissions. Those are their limited repertoire of tools. They also need to show that are doing something.

[madhavgpai]

The IT sector is fully capable of sending a part of their workforce to work from home. Mostly, any deterrent is only down to not planning for such a scenario. Considering that this may not be the last Virus mankind has to deal with, corporations will not be able to not devise business continuity plans around the work-from-home model, at least in the future.

[SmartCat]

Wikipedia now has a page dedicated to this topic:

Socio-economic impact of the 2019–20 coronavirus pandemic
https://en.wikipedia.org/wiki/Socio-...virus_pandemic

[mvadg]

Originally Posted by Samurai

Caronavirus is our future, it won't go away...

Thanks for recommending this video. It was recommended by YouTube, but I value TBHP opinions more.

After listening to her, I think we should just drop all quarantine measures and carry on business as usual. It will save the global economy and will not make too much of a difference to the mortality rate in the long run. Human behavior is not going to change anyway.