Family financial crisis, a “time bomb” in the world

The number of new cases of new coronary pneumonia in the United States and many European countries remains high in the tens of thousands. Today, people in these countries have spent a long life of epidemic prevention that spans spring, summer, and autumn. Next, they will have to meet the dangerous winter when the epidemic is more prone to outbreaks. More and more Western families have felt that it is overwhelming-the reduced income can hardly bear the daily expenses. Even if they have savings, they will be exhausted in such a “protracted war” of epidemic prevention. Under the pressure of household financial exhaustion and increasing debt, more and more people are fiercely opposed to the blockade measures, but restarting the economy will certainly aggravate the spread of the epidemic. As a result, the anti-epidemic efforts will fall into a vicious circle.

United States

“Five mouths are waiting for dinner, but we have nothing”

“In the past few months, Americans have hardly gone to restaurants to eat or go on vacation. They no longer go to baseball games or concerts, and their membership in gyms or other clubs is mostly frozen.” The New York Times reported on the 27th. This paragraph describes the people’s “frugal” life of epidemic prevention in the past eight months, and claims that the situation of American families is “better than expected”, such as not falling into a debt crisis further.

The situation may just not be as bad as imagined, but it cannot be regarded as good. After all, until mid-October, the number of unemployed people in the US per week was still around 800,000. The Martinez and his wife are members of the unemployed army. In October last year, the newly married couple decided to relocate from San Diego, close to Mexico, to Seattle in the north because there are more job opportunities here. The Martinezes are Hispanics and they soon found a job that required both English and Spanish. Husband Nick is a real estate agency and also provides home improvement services for clients. His wife, Laura, works as a flight attendant on an airline, mainly flying international flights. The two have an annual income of nearly $150,000, which gave them confidence to buy a house in Seattle.

However, the new crown pneumonia epidemic that struck this year has completely changed the lives of the Martinez couple. The aviation industry was hit hard, Lola lost her job, Nick’s company was poorly managed, and could barely receive work under the lockdown order. Both of them had to live on unemployment benefits, and the emergency funds they had just accumulated had to be used to repay the mortgage. . At the beginning of the epidemic, the relief money issued by the Trump administration allowed them to receive 600 US dollars a week in subsidies, and a total of nearly 5,000 US dollars in one month’s income. Excluding the mortgage payment, there is still 2,000 US dollars in living expenses. However, this subsidy ended at the end of July. After the emergency funds were used up, the couple had to consider selling the property.

Laura told the reporter that when they first arrived in Seattle, the prospects were very good. The two had already begun to make a pregnancy plan, but now they must “delay this plan indefinitely.” Nick also had the idea of ​​returning to San Diego. After all, there are still family and friends who can take care of each other, but after the two negotiated, they decided to use the money to sell the house for a while to see if there were new opportunities. “It’s a bit unwilling to go back like this. Now I gradually resume work and production, and there are more home improvement tasks. I hope the situation can improve.” Nick told reporters.

In order to save the economy, the Trump administration has continuously called for the resumption of work and school as soon as possible. However, some states unruly promoted the “restart”, which led to a counterattack against the epidemic and put more people under medical pressure. Johnson, who lives in New Jersey, is a neighbor of a friend of the reporter. She is nearly eighty years old. Affected by the epidemic, Johnson’s daughter returned the rented house and took the whole family to live with her to save money. The daughter and son-in-law have not been laid off. In order to make more money, they devote themselves to work, and the important task of taking care of the two children is left to the old lady. After that, New Jersey gradually opened up and many schools began to resume classes. Johnson’s daughter decided to let one of the children go to school. Unfortunately, there was an infection in the child’s class, and it is not known whether the child brought the virus home, and Johansson developed symptoms of new coronary pneumonia. The daughter immediately sent her to the hospital, but the cost of treatment made them worry. “The old lady only has basic medical insurance, and there is a large part of the treatment expenses that need to be paid by herself. I don’t know if the money we just saved is enough.” Johnson’s daughter said.

Since the 2008 financial crisis, more and more Americans have changed their past “moonlight” consumption habits and established emergency funds for their families. However, most wage earners have difficulty saving money because their income and expenses are basically the same. The Fed’s report last year stated that 4 out of 10 Americans were unable to pay $400 of unplanned bills from their savings.

In September, a survey jointly conducted by the National Broadcasting Corporation, the Robert Wood Johnson Foundation, and the Harvard University Chen Zengxi School of Public Health showed that nearly half of U.S. households (46%) faced severe financial crisis during the COVID-19 pandemic. , 54% of those with an annual household income of less than US$100,000 said they have serious financial problems, while 20% of those with an income above the threshold.

Trapped in the financial crisis, some families even have problems eating. Sullins, a 32-year-old North Carolina resident, told the US CNBC website that the most terrifying moment for her was not when she was unemployed in March, but when she ran out of food. “We have to eat with five mouths, but we have nothing.” . The Salins have two children and their grandmother lives with them. In order to solve the food problem, Salins turned to a local agency that provided food assistance. According to a September survey by the U.S. Census Bureau, about 10% of American adults said that they sometimes or often did not have enough food in the past week.

Michael Surrey, a lecturer in finance at the University of Texas, said that in the early days of the epidemic, the historic aid actions taken by the Federal Reserve and Congress had a certain buffer effect on the economic shock, but now, the effects of the actions have disappeared. “Therapy must be a public health solution… Other measures are just for the economy’s life.” Sarri said.

Currently, the US epidemic shows no signs of improvement. In the predicament, the lives of many people have undergone tremendous changes. Many white-collar workers with an annual salary of more than US$100,000 have joined the express delivery team to send online shopping orders, and many people have moved away from cities with high consumption levels to rural areas and low-rent central and western regions. A poll conducted by the Pew Research Center in September showed that more than half of Americans believe that even if the epidemic is over, the changes in their lives will continue. As Nick and Lola said to the reporter, “I will never spend a lot of money in the future, and live a day without tomorrow.”

More and more people in France are starting to value savings

For Antonio Faria, who has two children, the impact of the epidemic on family income is “huge”. Faria runs a small travel company in Paris and he has received few orders since March. As a small business owner, Faria can receive a solidarity mutual aid fund issued by the government. However, the sharp decline in income has a significant impact on household consumption. “We canceled our travel plan for this summer and reduced our purchase of non-essential items. For example, we basically did not buy anything during the summer discount season.” Faria told the reporter.

The total number of confirmed cases of new coronary pneumonia in France has exceeded 1.2 million. Faria believes that under the severe epidemic prevention situation, the implementation of the curfew policy is necessary. However, he is more worried about his livelihood: “Overcoming the virus is a long-term battle, but before the end of the battle, my company may not exist. Up.”

According to a survey recently released by the French National Institute of Statistics and Economics, from March 17 to May 11 this year, the nationwide “cities closure” measures resulted in about a quarter of families “in poverty”. In May of this year, 23% of French households said that their financial situation was “deteriorating”, two-thirds of the interviewed households answered “stable”, and 2% of households said they were “improving”. Among the households “in poverty”, 42% of the respondents said that they “need to pay attention to expenses”, 27% had “difficult” financial situation, and 7% of the households said that they “cannot make ends meet and need to borrow to live.” The survey found that the economic situation of families with children has been more severely affected.

It is true that the epidemic is the main reason that many individuals and families fall into financial crisis, but before that, the continued growth of credit caused by the consumption and investment habits of the French has laid the groundwork for the current predicament. According to data released by the Bank of France, as of March this year, the amount of French household debt was 1.489 billion euros, accounting for up to 98.08% of its cumulative total disposable income.

The family financial crisis has reduced consumer demand, which is not conducive to the country’s economic recovery. According to French media articles, the current consumption of French households has increased compared with the period when the city was closed, but this cannot make up for the “gap”-a large amount of unconsumed funds accumulated during the period of the city closure. In addition, more and more French people are beginning to attach importance to saving. According to the statistics of the Bank of France, from January to the end of August this year, French residents’ savings of all kinds reached 37 billion euros. The average savings rate in the second quarter was 20%, and during the “closed city” period it reached 30%, which was the 50th century. The highest level since the decade.

Since the outbreak of the epidemic, the French government has provided a lot of assistance. Part of the unemployment policy has guaranteed a large number of employees to receive wages when they are not in business or working remotely. However, the rebound of the epidemic has made the economic recovery face a more complicated situation, and it may take a long time for some families to “recover”. ▲

Germany asks livelihood questions every day

Compared with other European countries, Germany’s economic strength is more prominent. However, because the economy depends on exports, the epidemic has also dealt a heavy blow to Germany, and the income of many households has been affected. According to various polls, the income of at least one third of German households has dropped significantly during the epidemic.

Olaf, who lives in Hanover, is 41 years old and works as a project manager for a booth construction company. He told the reporter that Hannover is the “city of conventions and exhibitions.” In previous years, there were exhibitions one after another, and the company was too busy. But this year almost all activities have been cancelled, and the company has no business. All employees receive “short-time work” wages, that is, they are not unemployed, but they can only receive about 60% of their wages and there are no subsidies.

“Will I be unemployed next year? How long can I still pay the rent? In the past few months, I have asked these livelihood-related questions almost every day.” Olaf calculated an account to the reporter: his current monthly salary It’s 1,600 euros, and the wife does a “mini job” (working hours do not exceed 20 hours a week, less than 50 hours a month-editor’s note), and the monthly income is only about 500 euros. If you have a child in the family, you can get an appointment 400 Euros for ordinary and epidemic children’s allowance; monthly rent of 1,100 Euros, basic living expenses of about 1,000 Euros, and about 500 Euros for children to go to school and hobby classes. In addition, there are transportation and entertainment expenses. The family’s financial situation is just beyond making ends meet. “I have never been unemployed, nor have I experienced this year’s situation, so I don’t pay much attention to saving on weekdays. Savings were not much, and now they have been spent.” Olaf said that if the epidemic cannot be contained next year , Then he is about to face unemployment, “the whole family feels that the prospects are slim.”

Claudia, who lives in Cologne, runs a restaurant. She told the reporter that Cologne is a famous tourist city. In the past, restaurant business was good all year round, but this year, tourists from Asia and North America “disappeared”, and European and local customers are also much less. “At present, the restaurant is still open, but due to the second wave of outbreaks, social distancing regulations, etc., there are only a handful of customers every day, and it is not profitable at all.” She said.

Governments at all levels in Germany give out “big gift packages”, and a small company can get a subsidy of nearly 10,000 euros, but this is a drop in the bucket. The restaurant is affecting the lives of Claudia’s family of four at a loss every day. “The daily expenses depend on the savings over the years, but at most it can only support until the end of the year. I still have employee salaries to be paid.” Claudia said that if the epidemic continues, she will have to borrow from the bank, and may even have to Close the restaurant.

Claudia’s 16-year-old daughter Sophia told the reporter that she used to like to buy famous brands, taste delicious food, and travel to other countries. Now, she and her brother have to live within their means to spend money. This year, her family People have not traveled yet. “But the situation in our family is pretty good. Some of my classmates can’t take classes online because they don’t have a computer at home.” Sophia said.

German sociologist Marcel told the reporter that compared with Chinese families, German families obviously lack “awareness of worry”, which is first reflected in the problem of low savings. A previous survey conducted by ING International Group found that 1/3 of Germans are “moonlight people” and even those with higher incomes will spend their money on vacations. Secondly, Germans do not like financial management, and many families do not buy stocks, funds, etc. In addition, many people do not own real estate. At the same time, rents and house prices in Germany have been soaring in recent years. According to data released by the German Federal Statistics Office at the end of September, the average residential property price in Germany in the second quarter of this year increased by 6.6% year-on-year.

Under economic pressure, many people took to the streets to protest the epidemic prevention measures. Robert from Berlin told that the government’s actions such as blockades and curfews have severely affected the development of some industries, such as his own tourism industry. Going downhill”.