What will the economic impact of coronavirus be?

ABC News chief business correspondent Rebecca Jarvis explains why the banks are in a better place financially than they were in 2008.
6:34 | 03/18/20

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Transcript for What will the economic impact of coronavirus be?
Boy do we need you yeah. We've been tugging by the economics. Of this virus on the show for a long time and yesterday we we have Treasury Secretary Stephen new action. Touting this one trillion dollar. Stimulus plan a response to the court corona virus pandemic. It includes sending out checks to Americans immediately and were hearing a thousand dollars. Can you break down this planet tell us how that would work logistic week as are we talking about a thousand dollars a week a thousand dollars a month. Is a tax one time thousand dollars what is this about. Well they're still sunny out lot that we don't know specifically about the plan because they haven't unveiled. The official plan at this point but what we know is that there was checks need to get in the hands of Americans as soon as possible. Treasury Secretary minutia is that in the next two weeks it's likely that it will be before the end of April assuming that the plan does past. And it is at this point a one time check in that range of a thousand dollars maybe a little bit more there will be income caught ops if you're making a million dollars for example yesterday the Treasury Secretary said this isn't for you but it is undeniable the unemployment rate in this country is facing a lot of pressure with all of these shutdowns and we've already seen. Claims for unemployment it's up an unemployment insurance surging with so many hotel workers restaurant if there are worried rank us. I mean the bottom line here is that. There is a giant crater right now in our economy you can't shut the world down the way that we have. And not have a near term economic fact the longer term question is the length of the disease. How US consumers respond and also how the government present and without a contingency plan out what are the benefits of this immediate cash payment verses that say a payroll tax cut. Or something longer term because we've heard about that as well. When you have been near term issue right now people who are out of work and can't pay their bills there is a domino effect from that it's not just a matter of people can't pay their bills you have to think about everybody on the other end of those bills and those businesses that well as well and airy employees who become at rest. So being near term. Impact of giving people this money is allowing them to make their payments right now without their paychecks if you were to go the direction of that payroll tax cut. It would depend on people actually having payroll employees actually getting paychecks to see the benefit up. I have look a crazy question it's what they happen. Why isn't why don't we talk about mortgage for forgiveness and debt forgiveness since everyone is not working and also tax forgiveness. When that take the pressure off people as we wave no one had to worry about doing that. Because they wouldn't be a run on banks because the banks have their insurance to take care of them it seems to me there are a lot of things that we should be looking at. That would relieve the pressure on people. Of all my guy have to pay in my I have to pay my bill I have to pay this I have to pay that if you know if we were African debt forgiveness was in. That future there wouldn't. That help. Well it certainly is something that Italy is working with right now what we've actually seen what BR a number of private companies. Goldman Sachs Capital One. Credit card company is telling people with credit cards. You don't have to make the payment this month and we will not charge you fees for that we won't charge you interest for that I would caution that if you can make your credit card payments. Even though that sounds enticing you should be making them because both longer term it goes the bigger that debt balance grows. For you personally so he may get if you can afford to make it but again. Part of the issue is the domino facts now you have two different parties right now that can really shaped things you have the government which can put money directly into people's hands. And you have the Federal Reserve. Which can sort of grease the skids upbeat financial markets and by cutting interest rates to 0%. They freeing up the ability for banks to make some of these. In these things that are better for people. And and one thing I want to Acura lot of people looking at this are gonna think 2008. And the good news at least at this point in time is that the banking system. Is on much stronger financial footing so the banking system has the ability now to help. Much more than they could act. Screen now we talked about. A lot of workers are already being affected treasury sec Treasury Secretary Indonesian said that it could if 220% unemployment. What is the immediate relief for small businesses right now in in individuals who are relying on tips and service industry to get their pay. I think it is a very scary time for the thirty million small businesses in this country that can. A lot of these businesses Serra live paycheck to paycheck at the same way that Americans do. And they will have that expansion of the tax payment for ninety days according to the new White House stimulus plan. But for them talking pictures small business association. Talking to your competitors that's actually an interesting idea right now that I -- hearing some people talking about. Instead of going out this totally alone. Talk to the person up the street that's doing the same thing. And band together and then it's on us I went around this weekend and bought gift card every half a in my neighborhood again. Every restaurant in my neighborhood if you think about the things you wanna see in your neighborhood after this crisis and you invest and none tonight it will help. So let me ask you about that on the stimulus plan. It seems pretty clear it's gonna pass in some ways to reform and yet the stock market is in response yeah it's not like the stock market is suddenly say I'll. Okay were in good shape now moving for right the stock market continues to dip. Why isn't there that eighth on Wall Street that this is gonna help solve the issue or at least help at least temperate. Because the problem is bigger than that you know we're talking about his trillion dollar stimulus right now. During the financial crisis says the entire stimulus package was 785. Billion dollars. There are industries right now that are facing critical. Critical times. Americans who cannot go to work because the entire economy a shot down. And I think Wall Street is aware of the facts that. What's being done right now can cushion the blow. But going forward and there are big questions about. What happens to these industries. And how quickly he consumer comes back after all yes.

This transcript has been automatically generated and may not be 100% accurate.

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