As the novel coronavirus COVID-19 outbreak continues to spread around the world and has been declared a global pandemic by the World Health Organization, the next global economic recession is no longer an “if” or even a “when” event. Unfortunately, it is already upon us. In just the past few days:

• Stock market indices have continued to exhibit high volatility, rallying one day and plunging at a record pace the next;

• Companies around the world are shoring up cash, as they start to fear for their liquidity;

• Countries have adopted drastic measures to limit outside travel and social interactions;

• Health systems in the most afflicted countries are strained to near breaking point;

• Oil prices have dropped to levels not seen since 2016, responding both to the expectations of low demand and an increase in supply.

• Production processes and value chain linkages were first disrupted in Asia and now in Europe and the US;

• OECD projects global growth may slow to 1.5 percent in 2020, half the growth rate anticipated prior to the outbreak of COVID-19.

The double shock to both supply and demand comes at a time when both the private and public debt to GDP ratios have already reached record levels in many advanced economies. Without coordinated monetary and fiscal policy actions, the economic crisis could quickly and readily reach a historic magnitude.