While some people continue to come up with new conspiracy theories all the time, I would like to tackle the “substantial” aspects of this virus crisis.
It can be seen that the Federal Reserve has been working not only as the central bank of the United States, but as the central bank of the globe lately. I said, “If the US economy can’t manage to improve soon, no other country in the world can’t do it alone” in the beginning of the week, on television. “Neither China can do it” I also added.
“Chinese population is large enough to save Chinese firms” some say. If this were true, Turkish market of 80-million people would be more than enough to help Turkish companies. But, it isn’t; because global demand is always more dynamic and stable than domestic demand. That’s why China can’t improve its economy without engaging in exports again. As by far the world’s largest exporter, China exports a total of $2.5 trillion worth of goods, but it also imports $2 trillion worth of goods. So, I think I would not be wrong in saying that if the US can’t get better, neither can Chinese economy and the rest of the world.”
From now on, we better keep a close track of good news about the coronavirus as well as Chinese and US stock exchanges. Although everything and everyone is interconnected, people’s happiness is hanging by a thread, because, there isn’t any positive, encouraging news on the pandemic so far. The number of confirmed coronavirus cases and the death toll keep growing. It’s a real tragedy that many healthcare professionals are infected with the virus too. But, we shall maintain hope, especially in difficult times like these.
“Amidst the chaos of printing money, inflation, and the value of money…”
To keep the U.S. economy from suffering, the Federal Reserve decided to provide U.S. dollars to central banks in other U.S. states and major foreign central banks during times of stress. The funding provided to CBRT isn’t too much but it’s a sign of good intentions nevertheless.
In the meantime, the US Dollar and Euro keep appreciating against other currencies, which indicates that the “The Fed is printing money! The Dollar will lose in value!” argument wasn’t correct at all. There’s a huge gap between the amount of printed dollars and the global demand for dollar. So, Fed can’t possibly meet such large demand even if keeps printing money night and day. I think now it’s becoming clearer that all those theses supposedly established to argue the amount of money, inflation and parity were nothing but unconfirmed theories.
Obviously, we have some difficult times ahead. These anti-coronavirus drugs used to keep the patients alive will have some side effects as well. But, we can’t lose hope now. We can’t let ourselves to fall into depression. What we need to do is to make every effort possible to keep economy alive, not to mention the necessity of predicting potential complications. The more mentally prepared we are, the quicker we can take action.