Last week, the US began shutting down in order to reduce the spread of the coronavirus. Now, the country is effectively closed: Schools across the country are canceling classes, bars and clubs are shutting their doors, and restaurants are being restricted to takeout or delivery only. The CDC has recommended that people avoid gatherings of 50 people or more.
As the United States gets used to this surreal new normal, many parts of Europe are already there. Italy approaches its first full week of a near-total shutdown. Spain followed suit this weekend, barring people from leaving their homes except to go to the grocery store or pharmacy. France has ordered bars and restaurants to close.
These fast-moving developments over the weekend rattled US markets once again Monday, as trading was suspended for the third time in two weeks. The US Federal Reserve slashed interest rates over the weekend, but none of it is easing the panic over what the coronavirus is doing to the global economy.
Here’s what you need to know to start your week if you (hopefully) turned off the news this weekend.
If you weren’t social distancing before, you’ve got no excuse now
The United States has more than 3,000 confirmed cases of coronavirus as of March 16, according to data from Johns Hopkins University. But experts believe the actual number of infected is much, much higher, as the slow rate of testing in the US compared to some other countries, may be underestimating the full number of cases in states, cities, and towns.
States and local governments are moving rapidly as a result to try to force social isolation and prevent crowds from forming. New York City, after much debate, is closing all of its public schools to its more than 1 million students through April 20 and potentially, indefinitely. School facilities will remain open to provide grab-and-go meals to students, and teachers will begin remote learning next week. The city is also forcing bars, clubs, and theaters to close as of Tuesday morning, though restaurants that provide delivery or takeout can remain open. On Monday morning, the governors of New York, New Jersey, and Connecticut all announced expanded measures effective 8 pm tonight, including the shutting of gyms and casinos. Such measures in a place like New York City are difficult to grasp, but might be necessary after a weekend where social media documented packed bars and restaurants.
It was the same in other cities and states. Dozens of other states are closing public schools and transitioning to remote learning. Illinois’s governor has ordered bars and restaurants closed for two weeks (delivery and pickup excluded), after people disregarded social distancing recommendations and just did St. Patrick’s day anyway. Los Angeles did the same. Washington State did, too, and is putting restrictions on the number of people who can be inside retail spaces. Expect more state and local governments to follow with similar measures soon. But even if they haven’t yet, just listen to Arnold on this one, and stay the heck home.
The federal government has been a bit more cautious about introducing sweeping restrictions, though Vice President Mike Pence said at a briefing Sunday that domestic travel restrictions and other measures are under consideration.
On Saturday, the US expanded its European travel ban to include the United Kingdom and Ireland. Late Sunday, the CDC updated its guidelines to urge all groups to suspend gatherings of 50 people or more.
There’s a White House Coronavirus Task Force briefing scheduled for 3:30 pm Eastern on Monday, where the public may (or may not) get more information about testing, restrictions, and more.
Europe goes quiet
Italians, more than 60 million of them across the country, are under strict orders to stay home. Just work, doctor visits, and trips to the pharmacy or grocery store are allowed, and they must wait in line three feet apart, as stores only let a certain amount of people in at a time. They must also carry an “auto-certificate,” which says they’re allowed to be out, in case they are stopped by police.
Italy put these sweeping orders in place last Tuesday, the first country to do so in Europe. Now Spain, which now has the most coronavirus cases in Europe outside Italy, has also instituted a state of emergency, requiring Spaniards to stay home except for essential work or travel. Shops, restaurants, cafes, busy piazzas — all empty. France has instituted a partial shutdown, closing bars and restaurants, but markets and bakeries stayed open. Local elections in France went ahead as planned, though with lower turnout. And yellow vest protesters defied the ban and continued to protest the government. Austria has banned gatherings of five or more people. Germany is instituting temporary border controls. Ireland has ordered pubs — yes, pubs in Ireland — closed until at least March 29.
The economic picture of the coronavirus is becoming even bleaker
Trading was halted on Wall Street for the third time in two weeks, after the Dow Jones plunged 9.7 percent and the S&P 500 fell more than 7 percent shortly after the opening bell. The 15-minute pause was just that; stocks on the Dow Jones have now fallen to a three-year low.
On Sunday, the US Federal Reserve announced it would cut its target interest rates to a range of 0 to 0.25 percent, which bottoms out interest rates to where they were during the the Great Recession. But this doesn’t seem to have reassured anyone about just how bad this could get, and markets in Europe and Asia also fell.
Uncertainty about the spread of the coronavirus looked to be the driving force behind the market’s volatility just a few weeks ago. Now, the grim economic picture is starting to become much clearer. China has reported that economic activity in the first months of the year was far lower than even some analysts expected, with some forecasters predicting China’s economic growth could be its lowest since the 1970s, well before it instituted market reforms and made up such a large chunk of the global economy.
Airlines have said they are facing their worst crisis since 9/11, and this time the shock might be even deeper. Delta Air Lines, for example, is grounding 300 planes and reducing flights by 40 percent, the largest cuts in its history. As bars and restaurants shut down, fears are increasing over the fates of service workers and small businesses. And while Netflix and Zoom and Costco may have had some good weeks, as more and more Americans stay home, they may not spend so much anymore, either.