Even though the vaccines have the potential to reduce the Covid-19 pandemic to manageable levels, the scars will be felt for years to come.
Beyond the tragedy of the loss of human life, deepening inequality is perhaps the worst consequence of the pandemic. Governments around the world will seek to take steps to reduce it, fearing civil unrest.
The UK government awarded hard-working medical staff a
meagre 1% pay rise in the most recent budget, all the while splashing out on
yet another indirect subsidy for house prices: the mortgage guarantee.
If you’re like me, you’ve certainly wondered why economic growth has been so sluggish after the worst post-war recession — the Great Recession, or Great Financial Crisis as some have callednthe 2007-2009 crisis. Normally, the economy should have surged, after such a deep slump.
Instead, we’re proud of economic growth figures around 2% in Britain and the US and cheer when the eurozone posts a meager GDP advance of above 1% almost a decade after the crisis.
The issue of the runaway Swedish housing price bubble has been well known for a while, and the problem just keeps growing bigger. At this point, however, any attempt to tackle it could make things worse.
As more and more people fret about imminent interest rate increases by the Federal Reserve and the Bank of England, a report release by the Bank for International Settlements (BIS) shows that companies and households in the UK would be able to cope relatively well with a rate increase.
Inflation has been on a break for a while, and worries about deflation mount. But rather than worrying, perhaps it would be better to see this new face of the crisis as an extraordinary opportunity: that of doing away with debt as the main driver of growth.