Two women walk over a bridge with the European Central Bank in background in Frankfurt, Germany, as the sun rises Monday, March 30, 2020. Due to the coronavirus the economy expects heavy losses. For most people, the new coronavirus causes only mild or moderate symptoms, such as fever and cough. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia. (AP Photo/Michael Probst)
FRANKFURT, Germany (AP) — A group of leading economists say Germany, Europe's largest economy, will suffer a deep slump in the first half of this year but should rebound relatively quickly from the disruption of the virus outbreak.
The German Council of Economic Experts predict that the economy will shrink 2.8% for the full year and rebound next year with growth of 3.7%, although their report issued Monday acknowledged a high degree of uncertainty about the length of the restrictive measures that have shut down much of the economy.
The base scenario is a V-shaped recovery, with a sharp downturn and quick rebound.
Member economist Volker Wieland of Frankfurt's Goethe University said that the downturn would be “deeper but not longer” than the recession following the global financial crisis a decade ago with a steep fall over the first six months followed by recovery.
“It is not like a war where the capital stock has been destroyed,” meaning many businesses could quickly resume operations, he said, conceding that “the uncertainty is immense.”
The report's alternative, more pessimistic scenarios include a deeper slump of 5.4% this year. Another scenario that assumes restrictive measures remain in place past the summer implies a slower recovery with a dip of 4.5% this year but only a 1.0% rebound in 2021.
The council's report contrasts with a more pessimistic estimate from Munich's Ifo institute of a fall in output of 7.2% to 11.2% this year.
The German economy shrank 5.7% in 2009 as a result of the global financial crisis and the Great Recession but rebounded the year after.
12 Cheap Dividend Stocks to Buy Today
The markets are off to a strong start this year and major markets are trading at near all-time highs. The Dow is hovering around 30,000 and the S&P 500 is trading near 3,300. S&P 500 stocks are trading at nearly 25 times their annual earnings, well above historical norms.
At the same time, interest rates are near all-time lows. 10-year Treasuries are yielding just 1.8% and collectively S&P 500 stocks are yielding under 2%. Some investors think that it's too challenging to find safe and affordable securities that pay 4%, 5%, and even 6% yields.
Searching for yield isn't easy in an environment where high asset prices have driven down dividend yields, but there are a few meaningful options to find yield. With interest rates slowly beginning to rise, investors have found dividend stocks slightly less attractive. This has created a small group of cheap dividend stocks to buy, many of which have yields twice as large as the 10-year Treasury.
Let's review some of the best cheap dividend stocks in the market today in this slideshow.
View the "12 Cheap Dividend Stocks to Buy Today".