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Comment by throwaway_pdp09 | Hacker News Reader

> - The news everyone wants now is fiscal stimulus

Market-clueless newbie here. How would fiscal stimulus help a market that is seizing up due to reducing supply side (factories close) and reducing demand side (pubs to be closed, airlines crashing because of border closures, & more) and a disease that is likely to stress many countries medical provisions to breaking point, and then beyond.

Didn't the US dump 1.5 trillion dollars in a few days ago, and the market bounced but briefly? I mean it was obvious to me that it wouldn't work, why do you (as an expert - and I don't mean that sarcastically) think more stimulus, or indeed any, would help at this point?

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The mid-to-long term issue will be demand contraction.

Small businesses under stress, service workers not paid or let go completely, workers in general laid off, etc. All this will lead to the average person being under financial duress with rent/mortgage still due, potential medical bills, and so on and so on.

If you can get money into people's pockets (Congress has to do this) instead of cheap loans to banks (Fed does this), then you have a fighting chance of actually smoothing out the major demand contraction that is coming.

Yep. This is what we get without social safety nets: a large fraction of the country is constantly perched on the cliff of poverty. Just one big thing has to go wrong and it's all over. Right now, that one big thing is going wrong for virtually everybody all at the same time.

We have social safety nets here in Sweden and we're in a free fall too.

Yes but I assume you don't have a bunch of individuals who are about to have their lives ruined, potentially becoming homeless. The country as a whole bears the weight of the crisis, no?

In a few days time we ran out of space in the hospitals so unless you're dying you don't really get treatment. Businesses will die and peoples life will be ruined.

Not to the point of being homeless though, maybe living in the slum being dependent on government payout. (Which is not a fun existence)

Sweden is talking about herd immunity just as the UK because we don't have the capacity to handle it.

Bottom-up stimulus money helps us "socially distance" faster and to a greater degree, and bounce back quicker... we don't want to exit this disaster with bankrupt small businesses and unemployed/broke/homeless individuals.

>How would fiscal stimulus help a market that is seizing up due to reducing supply side (factories close) and reducing demand side (pubs to be closed, airlines crashing because of border closures, & more) and a disease that is likely to stress many countries medical provisions to breaking point, and then beyond.

If we literally hand money to people, they can pay their bills on time while we work through this thing.

I'm not sure what else will work at this point.

It's not feasible to simply have "rent holidays" or some such, as the OP suggests, as that rent expense is someone else's income.

Paging Andrew Yang...

Most of that rent goes towards a mortgage, which can also be suspended. The landlord still looses income, but not in a worse way then other bussiness which had to close.

I think (hope) he means: help the people directly affected, like bartenders, who are going to not be working real soon.

Especially painful for anyone relying on tips. They're very often under the table to avoid taxes, which has the downside of not being recognized re: unemployment / paid leave benefits.

The 1.5T wasn’t fiscal stimulus, just cheap loans.

Fiscal not monetary. Fiscal stimulus is writing checks to people and companies affected.

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