LongHaul Posted May 8, 2020 Share Posted May 8, 2020 What Extreme Events may take place during the pandemic? The main ones that I think are quite likely: 1. Sovereign debt defaults - Italy, Greece, etc. After the great depression there was a wave of sovereign defaults. I would not loan Italy 1 Euro. ~13% of the economy is tourism, it was 135% net debt to GDP prior to the crisis, weak economy, Euro as a currency and highly corrupt society. So on the 10 year Italian bonds you make ~2%, but could lose >60% in a default. No thanks. With ~2.5 trillion of debt this could easily cause a huge financial panic around the world. 2. Higher inflation in many countries from governments pissing away money rather than letting free markets work. Plus central banks easy money policies. 3. Real estate crashes with banking crisis in many part of the world. Thoughts? Link to comment Share on other sites More sharing options...
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