It’s holiday time, and the coronavirus has forced many families to cancel or change their plans for this season. There is much debate among economists as to whether the corona crisis is inflationary or deflationary. It’s especially inflationary for holiday homes in the Netherlands. I heard that many houses are fully booked and prices are skyrocketing.
Our family went to Spain. My in-laws have an apartment on the Costa Blanca, so we were flexible. On the outward journey I got dropped off in the Pyrenees and cycled around there for a week. I made reservations for hotels a day in advance, which went impeccably with reasonable prices. So, where demand is increasing less rapidly, there is no inflation. My journey started in Seissan in France and eventually passed ten mountain passes to arrive in Huesca in Spain. Beautiful weather, beautiful surroundings and a lot of climbing. The atmosphere in France was pleasant, it’s difficult for me to judge whether it was less busy than usual. When I descended Tourmalet after an early climb, many cyclists were going up. In France, masks were worn in shops, cafes and restaurants; not on the streets. As my tour progressed, I got in a hurry. In Aragon, the Spanish province in which Huesca is located, the virus re-emerged and I did not want to end up in a local lockdown. But when I arrived, the terraces were open and reasonably occupied as well. In Spain, a mask is also mandatory on the streets. Eventually I was able to travel to my family on the Costa Blanca with my rental car. I will work a week from here, after which another two weeks of holidays will follow.
The damage of the coronavirus is clear: the American and German economies shrank by about 10% in the second quarter, 12% in Italy, 14% in France and 18% in Spain. During my bike ride, I saw that we learn to live with the virus and the limitations that go with it. Daily life is picked up again nicely, but it will take a while before we can return to normal levels of economic activity. Here in Spain, the tourist season is a lot calmer than usual.
But this crisis also opens up new possibilities.