Coronavirus emergency
Old and New Challenges for Italian Banks
The pandemic which has tormented us for over a year has also disrupted economic and financial activity, triggering a crisis that it will not be easy to overcome rapidly. Here I would like to attempt to describe some of the consequences of the virus on banks, with particular reference to Italian banks. To this end, it is useful to recall the problems our banks were dealing with before the outbreak of the pandemic, that were the following: low or even negative interest rates; very high credit risk accompanied by the incomplete definition of the formal and substantial treatment of NPLs; excessively ...
A Question of Management
We are facing the worst period of the pandemic. This is the view of experts in various fields of medicine, and is stressed by many authoritative political representatives. We knew that this period would come, but as beforehand, we found ourselves unprepared. Not on all fronts, certainly; for example, masks and other personal protective equipment are now widely available. But many things have certainly not functioned properly: the tracing system based on the Immuni app, the long lines for tests, the local transportation systems in many regions, and so on. Why is this? There are various reasons, ...
The Great Race for a Vaccine that China Wants to Win
For more than a month the People’s Republic has not recorded any new locally transmitted cases of COVID-19;[1] schools and universities have reopened, and if we don’t consider the restrictions on entering the country and digital contact tracing,[2] everything seems to have returned to how it was prior to the pandemic. The Chinese economy was the first to breathe a sigh of relief, and the “Communist Party for the Chinese people, hit by the storm, has demonstrated the most reliable backbone,” President Xi Jinping declared last September 8, when he gave awards to the SARS-CoV-2 war heroes: ...
Anti-COVID Vaccine: A Global Public Good
The events of recent weeks, from the start of the first wave of COVID-19 infections in some countries to the arrival of what seems to be a second wave in others, indicate that the world will have a hard time emerging from the current economic crisis linked to the pandemic if a safe and effective vaccine is not discovered first. There is no precedent in human memory of the health and economic sustenance of so many people depending on a single healthcare intervention; and the hopes of so many people being placed in the hands of a professional category, that of scientists, that in recent years has ...
The Solitude of the WHO
"They’re giving [the information] to us 15 minutes before it appears on CCTV," the Chinese state channel. This, according to Gauden Galea, the World Health Organization (WHO) representative in Beijing. His words clearly describe the UN agency's frustration toward China at the beginning of January, with the attempt to scrape up the little information available on the new coronavirus, the one that has now infected almost 12 million people around the world, provoking over 550,000 deaths. This statement is part of an account by the United States news agency Associated Press[1] that confirms the ...
Forecasting in Times of Uncertainty: It Can Be Done
The Covid-19 emergency has caused a strong change in the business models of companies in many sectors. For some of them it has simply been an accelerator, for others something absolutely new. It is inevitable that, faced with this path of evolution, control systems, that have the goal of supporting decision-making processes and orienting management behavior, cannot be left out of this change. In particular, in a context characterized by a high level of discontinuity with respect to the past and by high levels of uncertainty, above all traditional tools for forecasting results and setting goals ...
Italian Banks Face the Text of COVID-19
What impact will COVID-19 have on Italian banks? This is the most frequent question in financial circles in these weeks. Today, there is no answer yet. It will take some time. A question we can ask, though, is: what is the condition of Italian banks today compared to the time of the previous crisis, that of 2008? We can answer this question. And actually, this is a first and necessary step to take in order to answer the initial question. We will divide our response into two parts. In the first part, we will analyze what Italian banks have done in terms of: improvement of asset quality, measures ...
Per Aspera ad Astra: Italy And Covid-19
The current crisis is an unprecedented global challenge in terms of its health, economic, social, and geopolitical impact. As we write, more than 4 billion people in over 100 countries are still living in some sort of lockdown. Each country has chosen its own strategy, adopting a variety of measures in an attempt to fight an unparalleled menace. Political decisions regarding population containment and border closures undeniably play an important role in the match against this epidemic. Specific features of different healthcare systems appear to greatly impact each country’s capacity to face ...
European Aid to Businesses: an Overview
The health crisis is now being followed by the economic crisis. In its April outlook the International Monetary Fund forecasts a 9.1 percent drop in Italian GDP for 2020, followed by +4.8 percent growth in 2021. The recently approved DEF foresees a drop of 8 percent, followed by 4.7 growth in 2021. Apart from forecasts - whose reliability is relative, since it is still not possible to fully assess not only the economic consequences, but also the real prospects for recovery, that will inevitably be conditioned by the course of the epidemic - it is clear that the coming months will be very complicated, ...
We Are Not All in the Same Boat
The COVID-19 pandemic is hitting the economies of every country in the world harshly, provoking an unprecedented employment emergency in many of them. An emblematic case, due to the importance of the country and the speed of the effects, is that of the United States. Before the pandemic, the US economy was on a solid track, with an unemployment rate that had reached a historic low of 3.5 percent in February, when China had already stopped. In March, when Europeans began to hole up at home, the US employment rate had risen to a moderate 4.4 percent. Just one month later, the data for April (the ...