Tomorrow's initial unemployment claim is forecast...

Tomorrow's initial unemployment claim is forecast... - Printable Version

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RE: Tomorrow's initial unemployment claim is forecast... - 2006alum - 05-15-2020

(05-15-2020, 06:50 PM)Mick Wrote: I mean no disrespect, but I disagree entirely. The poor and most vulnerable of this society have no means to survive outside of a paycheck. The insufficient employment + stimulus check (which runs out in August) guarantees misery. Nearly 40% of low income workers lost their jobs in March.
https://www.cnn.com/2020/05/14/economy/low-income-layoffs-coronavirus/index.html

Well then I assume you'll be supporting passage of Nancy Pelosi and the House Dems' bill as it moves to the Senate?
[tweet]https://twitter.com/thehill/status/1261473710487351300?s=20[/tweet]

Quote:The Democrats’ new proposal includes hundreds of billions of dollars for medical equipment and coronavirus testing, a new round of direct cash payments for individuals and families and an expansion of unemployment insurance benefits.

And according to Politico:

Quote:The House passed a $3 trillion coronavirus relief package that would deliver federal aid for state and local governments, provide rent and mortgage relief and expand unemployment and food assistance programs.

More details, from CNBC:

Among other things, the bill includes:

Quote:
Nearly $1 trillion for cash-strapped state and local governments

A second round of $1,200 direct payments to individuals, with up to $6,000 per household

$200 billion for hazard pay for essential workers

$75 billion for Covid-19 testing efforts

An extension of the $600 per week federal unemployment insurance benefit through January (it is currently set to go through July)

$175 billion in rent, mortgage and utility assistance

A 15% increase in the maximum Supplemental Nutrition Assistance Program benefit

Repeal of the $10,000 cap on state and local tax deductions for two years, which would help certain states’ budget crunch but benefit higher-income taxpayers most

Expanded mail-in ballot access, which Republicans oppose

Relief funds for the U.S. Postal Service

$10 billion in emergency small business disaster assistance grants

Subsidies and a special Affordable Care Act enrollment period for people who lose employer-sponsored health coverage

Seems like this would address most needs for the unemployed in the short to medium term, although as with any government program, I'm sure there are gaps and insufficiencies.

But gaps sure beat coffins, IMHO.

RE: Tomorrow's initial unemployment claim is forecast... - Mick - 05-15-2020

(05-15-2020, 10:12 AM)BostonCard Wrote: The good news is that generally speaking, America's labor force is more dynamic and tends to bounce back much faster than other country's. But you do wonder if we have a problem with employment fragility in the US.

BC

I think we have significant employment fragility after a dozen years of growth. American business ownership is, right now, undergoing a massive experiment to see how efficient they can become, and how much money they can make with, literally, as few workers as possible. And they are finding out -- well, what they've known all along -- is that labor costs are very, very expensive.

So those jobs aren't coming back. Hospitality & Leisure? Jobs are gone. Restaurants? Jobs are gone. Manual services and agriculture? In decline. Retail? Retail dropped like a rock, far more than experts believed:

https://www.cnbc.com/2020/05/15/us-retail-sales-april-2020.html

Seeya. Wholesale? Also gone. Durable goods? Fuhgeddaboutit. Professional services? Well, massive layoffs in my business, for sure. And on and on.

But it isn't just the RIFs. The remaining employees, across the board have taken pay cuts. Budgets have been cut. Payables have been lengthened. Deflation is here, thanks to the reduced velocity of money. People aren't spending.

RE: Tomorrow's initial unemployment claim is forecast... - BostonCard - 05-15-2020

The plot of employment growth in "recovery" doesn't look promising for the last three recessions.

Here's my guess. We peak at about 20% unemployment after the June unemployment report. Then we see re-hiring of 1/4 to 1/2 of the jobs lost over the rest of the year, as some businesses reopen and or rehire some of their laid off workers. That would put the unemployment rate in the 12 - 15% range by the end of the year. The rest are gone for good, and then we are looking at a long, slow recovery. Even picking up 200,000 jobs a month, as we did during the recovery from the Great Recession, it will take 135 months (that is, over 11 years) to get back to the pre-Corona employment level (and that doesn't even take into account the growth in the size of the labor force). As I said, we are looking at a "lost decade".

BC

RE: Tomorrow's initial unemployment claim is forecast... - Snorlax94 - 05-15-2020

I think it becomes an emotional thing and can be skewed by one’s experience.

For my part, I think I stayed over 30 nights total in a hotel last year, including a couple conferences. I watched close to 30 movies in the theatres. I watched at least 6 Stanford football games in-person. On March 16, all of those went to $0.

But I expect at some point in 2021, I expect the spending will return to previous levels, if not higher due to pent up enthusiasm.

Assuming I feel a restaurant is safe, I could see my family returning to pre-lockdown levels of eating out by June or July. There will be a lot more take-out, more eating outdoors, and absolutely no indoor dining.

And many many Americans are less cautious than me — I bet by summer many Americans will be going to theme parks and movies, while I’ll wait until a safer situation (whether by vaccine, effective treatment, or herd immunity).

I think Goldman’s economic estimates were the most objective and dispassionate and they were looking at the whole economy and not expanding from the perspective of one industry. Not intending to brush off anyone’s individual situation, but as a whole, I think Goldman’s estimate that by Q4 2020, the GDP will be about 3-4% below Q4 2019 should be close to right, although if we keep being dumb, if consumers are afraid due to a lack of testing, tracing, protective measures and competence, we will stretch the pain out longer.

So many people I talk to can’t wait to resume the activities in their life that they look forward to. The runners want to run in big marathons. The movie goers want to go to movies. Eaters wanna eat. Travelers yearn to travel. Parents can’t wait to dump off their kids in summer camps so someone else will be watching them. Some of this can happen in 2020, and probably the rest can start happening in 2021. I’d be surprised if in 2022 the economy is not larger and employment is not greater than 2019, barring some further catastrophe like a war, or a mass refusal by the American public to be vaccinated, etc., which are both possibilities.

RE: Tomorrow's initial unemployment claim is forecast... - BostonCard - 05-16-2020

Make that two lost decades....

https://www.economist.com/finance-and-economics/2020/05/02/why-the-unemployed-in-america-could-face-a-lost-decade

Quote:[color=rgba(255, 255, 255, 0.78)]Even in the rosiest of scenarios, the outlook for those without a job seems grim. Were unemployment to fall as quickly as it did from 1933 to 1937, a return to pre-pandemic jobless rates would still take half a decade. At the rate of improvement experienced after the financial crisis, by contrast, full recovery could take two decades. All that after the hardship of the 2010s seems nearly unthinkable. Yet without a hefty dose of good luck and an aggressive government effort, America’s unemployed face a real risk of another lost decade—or two. [/color][color=rgba(255, 255, 255, 0.78)]■[/color]

RE: Tomorrow's initial unemployment claim is forecast... - chrisk - 05-16-2020

The most important jobs will come back in due time and there will be some new ones, such temperature checkers and contact tracers. Some jobs will be created by reshoring. And the unemployment rate will be higher than it was the last few years.

RE: Tomorrow's initial unemployment claim is forecast... - OutsiderFan - 05-16-2020

It's time we as a public start asking some real existential questions about what kind of society we want to have.

I think it's long past time to exercise the anti-trust laws and start breaking up mega corporations. We also need to seriously look at taxes on stock trading and/or require stocks to be held at least 30 days. The idea of buying a stock and selling it a second later is absurd. We don't need and it isn't helpful to have the wealthiest people producing absolutely nothing. And we should also have conversations about tax credits for hiring people, and higher tax rates on wealth that is going to be needed to create more social safety nets.

Or we can just ultimately fight a bloody revolution history tells us will happen when gaps between haves and have nots become too great.

RE: Tomorrow's initial unemployment claim is forecast... - Mick - 05-16-2020

(05-15-2020, 06:55 PM)2006alum Wrote: Well then I assume you'll be supporting passage of Nancy Pelosi and the House Dems' bill as it moves to the Senate?

Absolutely, I do. Frankly, it isn't nearly, not remotely enough.

Look, I get it. The Elites who forced this economic stall and freefall on America have won the economic peace and the war. They've scared Americans into burrowing into their homes like fearful sheep. They've ensured the destruction of the American economy for decades to come. This could never have happened today:

https://nypost.com/2020/05/16/why-life-went-on-as-normal-during-the-killer-pandemic-of-1969/

It won't be a "V" shaped recovery. It won't really be a recovery at all. The societies who chose not to stall their economy will win, and America will lose. Not the Elites, of course, they have resources on which to fall back. But the -- let's see, I'm going to guess 60 million unemployed at the unemployment nadir -- lower and lower-middle classes are completely unprepared for this fall. And they'll revolt, hopefully in a bloodless fashion.

So, yes, I support the $3 trillion package, and it's too small by half. Yes, the currency will be debased, yes, our civilization will be reduced by some substantial fraction and the American Dream will die, along with any notion of American exceptionalism. And frankly, I'll support the Socialist-like moves that come later, including heavy income and wealth taxes on the wealthy, and the mobilization of the National Guard to enforce it. Why? In part because the Elites will deserve it, and in part because it will be our only option.

The desperate moves to keep as many old/diabetic/heart failure/hypertense (look Ma! I'm all four!) people alive at the expense of ruining the American civilization came from a good place, as far as the Elites are concerned. A noble cause in the face of a horrifying contagion. And their nemesis, Donald Trump will go down as the worst POTUS ever, and the Elites will gleefully pile on, convinced that any other POTUS would have magically prevented the contagion from arriving here and doing the damage it's done. And Trump's tax cuts not only ensured that the wealthy will stay wealthy, but that they will distance themselves from the Deplorables who voted for him. So yeah, in a year, his name will be a curse on everyone's lips. But it won't change anything. And it looks like senile Biden is the people's choice to solve everyth...ho ho HAHAHA!. Seriously? Neither Bernie nor Elizabeth Warren nor AOC will get elected, but their policies will take hold.

RE: Tomorrow's initial unemployment claim is forecast... - stupac2 - 05-16-2020

(05-16-2020, 08:40 AM)Mick Wrote: The Elites who forced this economic stall and freefall on America have won the economic peace and the war.

You keep saying stuff, but all available evidence suggests that very little of the current economic pain is caused by SiP orders. For one, even states that didn't close are seeing layoffs. As of April the least affected state saw nearly 10% of its workforce go on unemployment! Additionally restaurants were already seeing a brobdingnagian hit before SIP. Someone posted in one of these threads an article breaking down what the hardest-hit industries are (here's 538's take), and it's things like hotels, major events, and restaurants. Other industries are effected secondarily, but it's not because if SIP, it's because most people aren't morons and know that these things are inherently unsafe and won't do them.

There's no reason to think that the SIP orders are what is causing the problem. At best they're a minor contribution while preventing a lot of needless pain by keeping the ~10-20% of people (who aren't enough to sustain any kind of business) from becoming superspreaders.

The only people who forced this economic freefall on us are the various idiots in charge who couldn't manage anything resembling an effective response, and the idiots in the Senate who won't just pass all the damn bills.

RE: Tomorrow's initial unemployment claim is forecast... - Mick - 05-17-2020

(05-16-2020, 02:43 PM)stupac2 Wrote: There's no reason to think that the SIP orders are what is causing the problem. At best they're a minor contribution while preventing a lot of needless pain by keeping the ~10-20% of people (who aren't enough to sustain any kind of business) from becoming superspreaders.

Successful business owners aren't idiots, as a general rule. It was blindingly simple to understand the economic hit that SiP would inflict upon the economy, so the business owners acted long before the economic devastation -- they didn't wait until after it occurred. 70% of the economy is driven by consumers, and SiP would mean that consumers were largely held out to dry. This meant that business owners had to make hard decisions in advance. That included extending payables, accelerating collections efforts, cutting budgets, cutting salaries, cutting headcount. I started discussing furloughs with our CEO in early March, which meant he was considering it long before that. So the economic hit came in advance of the SiP. The expectations driven by the SiP that everyone knew was coming drove the furlough decisions.

And now, the average consumer and small business owner understands the nature of the economic devastation will mean ruin for them. Hence the protests, the creeping fear of the bleak future, the absolute knowledge that if we don't get back to work right now, they could lose everything. Joke's on them of course, we're long past the point of no return. And so you have the Elite judge scolding the Deplorable salon owner, and the judge demands an apology for the salon owner trying to feed her family.

More to the point, what is dawning on business owners now is that the economic devastation wreaked by SiP will have a permanent, lasting effect on America. So you can expect more rounds of layoffs, more budget cuts, more disasters as we continue to spiral downward. Food shortages this summer and fall. There has already been a rise in economics-related violence, and domestic violence is spiraling upward.
https://nypost.com/2020/04/02/major-crimes-up-12-percent-in-nyc-despite-covid-19-outbreak/

As bad as you think it's going to get, it's going to be worse. Much, much worse. And we could have avoided it all.

RE: Tomorrow's initial unemployment claim is forecast... - BostonCard - 05-17-2020

https://www.economist.com/briefing/2020/04/30/the-90-economy-that-lockdowns-will-leave-behind

The entire article is pretty good, but you'll find this section particularly relevant:

Quote:Some indication that the spending effects of a lockdown will persist even after it is over comes from Sweden. Research by Niels Johannesen of Copenhagen University and colleagues finds that aggregate-spending patterns in Sweden and Denmark over the past months look similarly reduced, even though Denmark has had a pretty strict lockdown while official Swedish provisions have been exceptionally relaxed. This suggests that personal choice, rather than government policy, is the biggest factor behind the drop. And personal choices may be harder to reverse.

And for its troubles, Sweden has 365 deaths per million population (behind only Belgium, Italy, UK, Spain, and France among large European countries), while Denmark's per capita death rate is a quarter of Sweden's (95 per million). Other Nordic countries are even lower: Finland is down at 54 per million, Norway is down at 43 per million, and Iceland has less than 1/10th the per capita death rate of Sweden at 29 per million (though I will grant you that as a small island nation Iceland probably had n easier time controlling COVID-19 than any other European country).

The evidence is that in terms of spending, it is not the lockdown or fear of a lockdown that drives consumer behavior (and thus, has screwed businesses), but rather fear of the impending pandemic. Consumers aren't stupid either. Forget an impending lockdown. Consumers see bodies piled in refrigerated trucks on the news, and lockdown or no, they are going to minimize unnecessary spending. They know that lockdown or no, their restaurant or retail or travel-related job is going to be in peril, and regardless of whether they have been laid off or not, they are going to retrench their spending because you never know.

I'll give you one example. I think I mentioned, in an early thread about the pandemic, that heading into the year, I was looking to buy a new car but that the pandemic and working from home put a temporary pause to that. It wasn't so much that my job was in jeopardy; I can work from home, my company's first quarter earnings met expectations (though the distribution of which products grew was impacted) and since the pandemic I have been busier than ever working on clinical trials of drugs to potentially treat COVID-19. I've even been helping interview candidates for three new positions. On the flip side, what was the point in getting a new car if I'm not commuting any more.

Ultimately, though, I saw an ad for a mint condition used car at a steep discount that had been purchased in December and had 2200 miles on it. The seller still had his job, but basically didn't want to have to be making car payments every month for a car he didn't need. Under different circumstances, the seller is probably not trying to unload his nearly new car, and I probably would have bought a new car instead, and we keep the car plants (and thus the economy) going. And this scenario happened to two people whose jobs weren't directly impacted by the pandemic and/or shelter in place orders.

BC