“In 2020, Wile E. Coyote is going to go off the cliff.”
So said former US Federal Reserve chairman Ben Bernanke in June 2018 warning that President Donald Trump’s unfunded $1.5 trillion tax cut and $300 billion in new spending could pose a serious problem for the future. For the uninitiated, the unlucky cartoon character from Looney Tunes, Wile E. Coyote, always fails to catch the Road Runner, a fast-running ground bird, and ends up going over the hill. While Bernanke’s prediction was for the economy in 2020, the “Wile E. Coyote” moment has manifested not because of an economic crisis but Coronavirus, which has been declared a global pandemic by the World Health Organization.
The outbreak of the respiratory disease (COVID-19), which began in China, has now infected 130,000 people globally, with fatalities surging past 4,000. As fears worsen and the outbreak spreads to 114 countries, global equities have been tumbling — with the S&P 500 falling 18% in just four days of trading. The trigger came after Trump banned all travel from EU to the US, stoking fears of a recession and forcing investors to dump risky assets (read equities). The total number of people who have contracted the virus in the US till now stands at 1,700. “Unlike what was done by a military regime in China, which shut down an entire province, the US has to either develop a medical dose to control this virus or the epidemic will spread,” feels Anoop Bhaskar, he