Much to my surprise, the Dutch government closed all bars, “coffee” shops, restaurants, saunas and sex clubs on Sunday evening at 6PM. The images of people hoarding for weed became international news. Saturday evening, the owner of a local restaurant had been afraid this would happen shortly. She had just sold her restaurant to her chef.
Other business owners will be less “lucky”. Fortunately, the Dutch government will – and almost immediately – assist business owners with several measures (eg, deferred tax payments, loan guarantees, partial unemployment benefits). My girlfriend’s daughter has already been notified of her imminent partial unemployment.
The German government is even considering “nationalization [] for supporting strategically important companies brought into difficulties by the coronavirus epidemic”. Moreover, “Germany would like to localize supply chains”. The German Economy Minister stated: “I can well imagine a common European project for medicine production.” (Reuters).
The famous Dutch soccer player Johan Cruyff once said: Every disadvantage has its advantage. The opposite is also true: by delaying the spreading of the coronavirus (to avoid peak contamination), it’s very likely that the duration of the virus will last (much) longer.
The result of the above may be compared to a (very) long row of domino stones. Each business bankruptcy will increase the chances of further bankruptcies. The first business corona fatality was the UK airline Flybe on 5 March 2020. CAPA Center for Aviation, 16 March 2020: “COVID-19. By the end of May, most world airlines will be bankrupt”.
There seems to be another row of dominostones related to interbank wholesale financing. These two separate rows of dominostones may soon start merging – with devastating effects. Since September 2019, the US central bank has already been providing (emergency) liquidity support to the repo market (eg, my 2019 blog, NASDAQ-2020). Bloomberg, 12 March 2020: “Fed Unveils Dramatic Measures to Ease Market Strain on Virus”.
It’s becoming increasingly clear that the ECB and the Fed cannot save crumbling global economies. Central Banks have lost their “firing power” due to the artificially low interest rates following their excessive quantitative easing programs (eg, my blogs of 2015-01, 2017-07, 2017-12, 2018-02-12, 2018-02-13, 2019-07, 2020-01).
“Our lives are made up of choices. Big ones, small ones, strung together by the thin air of good intentions; a line of dominoes, ready to fall. Which shirt to wear on a cold winter’s morning, what crappy junk food to eat for lunch. It starts out so innocently, you don’t even notice: go to this party or that movie, listen to this song, or read that book, and then, somehow, you’ve chosen your college and career; your boyfriend or wife.” A quote from the 2014 novel Dangerous Boys by Abigail Haas, a British author.
Domino (1990) by Clousseau
artists, lyrics, video, Wiki-1, Wiki-2
Ze is niet lang gebleven / She didn’t stay for long
Heeft geen adres gegeven / Didn’t leave a forwarding address
Ze heette Domino / Her name was Domino
Domino of zo / Domino or so
Note: all markings (bold, italic, underlining) by LO unless stated otherwise.
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