U.S. Economic Recovery Expectations
To obtain information about the major economic recovery projections in the U.S. based on COVID-19 in tiers (e.g. optimistic, neutral, pessimistic), to be used in discussion with prospective clients pertaining to their businesses in the COVID-19 environment.
- In the U.S., the most optimistic recovery would be Z shaped in which there would be a 'bounce back' of the economy to a higher level after the pandemic, compared to what it was prior to COVID-19.
- The neutral recovery tier could be U-shaped where the economy recovers slowly after social distancing is lifted or Nike Swoosh-shaped where there is a sharp 'bounce back' for the economy once restrictions are removed and activities become normal again.
- The worst-case scenario would be an L-shaped recovery where there is a "slowdown in productivity growth" and GDP gets lower.
- The U.S. is at risk for an L-shaped recovery.
- Jason Furman refers to the U.S. economy based on COVID-19 as a "medically induced coma".
- Furman and Cecelia Rouse (an economist) agree that the scare for the economy is because of the public health crisis which is not a common reason for a recession in the U.S. when compared with "[issues] in the financial market, oil prices, [and] monetary policy".
- Furman believes it would take 5 – 10 years to recover from a financial crisis.
- Furman and other economists are urging the government to use a “whatever-it-takes” approach to get the country in good economic standing during COVID-19.
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