Ready for the second round?
14 June 2020
We are all getting ready for the second round of the fight between the virus and humanity. The first round was all about “flattening the curve,” meaning that we had to limit contagion through severe physical distancing measures, lockdowns and curfews. The virus has equalized all economies in this first stage, if I may say so. It didn’t matter how rich or poor your country was, your population was vulnerable just the same, and you had to shut down your economy just the same. As Jerome H. Powell, chair of the Federal Reserve, put it so elegantly, “It’s the virus, not the usual suspects” that led to the sudden stop in global economic activity.
The virus and the unicorn
07 June 2020
It was my new year’s wish in 2019 to see the first Turkish unicorn that year, but I was disappointed. These mythical creatures are startup companies with a value of over $1 billion. There was a long list of them created by the venture capital industry all around the world, hailing from developing and developed countries, and yet none had come from Turkey. Finally, last week, Zynga acquired the Istanbul-based Peak Games for $1.8 billion. It was none other than the coronavirus that brought the first unicorn to Turkey.
A change in the nature of uncertainty
24 May 2020
The COVID-19 induced uncertainty has brought a sudden stop to real economic activity. We needed to slow down the spread of the virus to gain time and get to know the virus better. But now we are finally thinking about living with the virus, as new cases are subsiding. We cannot yet magically lift uncertainty, but we have a better sense of things. We are gradually moving away from the world of complete uncertainty into a world where we can assign probabilities to different eventualities, kind of moving from crisis management to change management. That’s what reopening is to many.
17 May 2020
Living in Ankara, I usually have to endure several tiring flights to participate in the events of universities, think tanks and international institutes. That is why the recent shift to virtual events has been a welcome development for me. Last week Fed Chairman Jerome H. Powel participated in one such virtual event at the Peterson Institute for International Economics in DC. He was saying that monetization was not that bad this time around. “The virus is the cause, not the usual suspects — something worth keeping in mind as we respond,” he said. I find this particularly important.
On the Shape of Recovery
10 May 2020
COVID-19 requires true leadership. Winston Churchill’s words come to mind: “sometimes doing your best is not good enough. You must do what is required.” In the uncharted waters of the fight against coronavirus, that’s what we need to keep in mind.
Why we aren’t going to be ‘roaring back’ to life
03 May 2020
When asked about the world economy after COVID-19, the U.K.’s Boris Johnson said that there was “absolutely no reason why economies worldwide should not come roaring back.” This was an extraordinary statement, and the prime minister obliged his audience with an explanation: “This is unlike 2008, there isn’t a systematic problem within the economy.” I disagree.
Helping the WHO to focus is what the G20 is about
19 April 2020
President Donald Trump attacked the World Health Organization (WHO) this week, announcing a 60-day freeze of U.S. funding going into the organization. He said the WHO has “failed in its basic duty.” The president is an unashamed populist, and it’s almost inappropriate to take his words as a reflection of his thoughts. What is important here is how international organizations are going to come out of this, and two of the most important I’m thinking of here are the World Health Organization (WHO) and the G20, both of which are vital in this crisis.
A different kind of recession
12 April 2020
COVID-19 is now stopping economic activity all over the planet. It is not the infectious disease itself that causes this effect, but the social distancing measures we have taken to buy us time. This is “the worst economic fallout since the Great Depression,” said Kristalina Georgieva, the Bulgarian economist who is now the head of the International Monetary Fund (IMF). We are used to have sudden stops in economic activity before in our part of the world, but this one is totally different.
Do you believe in COVID-19’s transformative power?
05 April 2020
It seems like a deep thing to say: Nothing is ever going to be the same again. The times they are-a changin’. I don’t like it. Are we talking good change or bad change? And aren’t things changing all the time anyways? Sometimes we notice, sometimes we don’t, and it seldom has to do with the suffering people go through.
The price of a leaderless world
31 March 2020
In times of great crisis, there are always those trying to leverage suffering for personal gain. It is the job of government to try to prevent that from happening as much as possible. In the 1918 flu epidemic, the United States put an 80 percent tax on all profits above 8 percent to prevent war profiteering.