Virtual Accounting Firm in Miami
The Coronavirus And How It’s Affecting The Economy
The coronavirus or COVID-19 is on everyone’s mind these days. The virus that first reared its head in China is now practically worldwide with new cases emerging in the U.S. every day. Aside from being a threat to the health of huge population across Asia, Europe and North America, it’s now also an economic threat.
The Impact on Stock Market
So how the coronavirus virus affect the economy? The virtual accounting firm of Miami Beach has learned about the huge plunges that the stock market’s been having. Investors are worried about supply shock and by mid-February the Dow fell 800 250 points, the S&P fell 1.7% and Nasdaq lost 1.9%.
Airlines can lose about $113 billion in revenue due to the coronavirus. At least, that’s according to an article on Investopedia. As corporations decrease business trips, worldwide events and festivals such as the Ultra Music Festival in Miami are being canceled or postponed, and travel advisories, people aren’t traveling as much.
Adding to the lost revenue, airlines, the virtual accounting firm of Miami Beach learned, are also waiving cancellation fees and crediting passengers. They’re also providing less flights to fill more seats and balance out the losses that are growing every day as new cases of the COVID-19 virus make the headlines news.
The Effects On Automotive Production
Due to globalization, China today is indispensable. So many products and luxury items are produced in China. Thanks to iPhones, car factories, the country’s demand for oil and copper, China makes up for 16% of the world GDP. The coronavirus is disrupting business for corporations everywhere and affecting supply chains.
According to CNN, car plants across China are closed preventing global automakers like Volkswagen, Toyota, Daimler, General Motors, Renault, Honda, and Hyundai from resuming operations in the world’s largest car market. According to S&P Global Ratings, the outbreak will force carmakers in China to cut production by about 15% in the first quarter.
The virtual accounting firm of Miami Beach learned that a severe pandemic could cause economic losses equal to 5% of the global GDP which is equal to about $3 trillion. The World Bank says, even a weaker flu pandemic like 2009’s H1N1virus can still eliminate 0.5% of the global GDP.
For more assistance, call the virtual accounting firm in Miami at 305.868.7620