Natixis - After the COVID crisis, a choice will have to be made between zombie firms and a Schumpeterian process

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Natixis

Patrick Artus

After the COVID crisis, a choice will have to be made between zombie firms and a Schumpeterian process

The COVID crisis will lead to a permanent deterioration in a number of business sectors (automotive, aeronautics, air transport, tourism, traditional retail, culture, office real estate). Countries will then have the choice between two strategies: Protecting jobs in these sectors, through credit and public aid, which will prevent job destruction but multiply the number of zombie firms; Accepting a Schumpeterian process and transferring jobs to growth sectors (IT services, online retail, healthcare, pharmaceuticals, telecom, security). Countries' ability to accept a Schumpeterian process depends on their ability to protect people (maintaining income, training and reskilling, etc.) and not only jobs.

22/09/2020 5 EN

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Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

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Analysts

Patrick Artus

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After the COVID crisis, a choice will have to be made between zombie firms and a Schumpeterian process

Long Bono 01/41 vs. Short Bund 05/41

Overview of the Asian covered bond market

Consolidation after the euphoria?

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