Lagarde is warning of a corona shock similar to the GFC, but the only thing this downturn has in common with the GFC is that share prices and oil are going down, and the economy rapidly slowing. In all other respects the analogy is entirely false.
Ok. I get you now. Imho, this will certainly unfold differently and must be responded to differently but is of similar magnitude (if not wayyyyy bigger) and will also require (different) significant government intervention.
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I think it's possibly bigger than GFC because 1. corporate debt bubble and 2. horrible companies were kept alive longer than in the past from this. There's a feedback loop if they all go out of business, people lose jobs/spending power, this crashes more marginal businesses, etc
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Banks are also healthy and the exposure of the major US banks to oil industry for eg is less than 10pc of tangible book, and not all of these loans are zeros. People are gettinf carried away. A doomsday scenario is not impossible but its by no means likely.
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