The coming decade-long depression - Printable Version
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RE: The coming decade-long depression - Mick - 06-03-2020
(06-01-2020, 02:38 PM)BostonCard Wrote: Funny you mention the Spanish Flu. In context, I understand you to mean that the "elites" of the day in 1918 stood aside and let the flu pandemic spread without implementing any social distancing measures. Not only is that false, but it turns out that the regions of the country where more stringent measures were adopted not only had fewer deaths than those who delayed implementing social distancing measures, but also that those regions did better economically.
I don't think I ever said or implied that the authorities in 1918 stood aside. Obviously, they took what steps were available to them to prevent the spread of the flu. But they didn't shut down their economy like we've done.
RE: The coming decade-long depression - 82lsju - 06-03-2020
(06-03-2020, 11:49 AM)Mick Wrote:(06-01-2020, 02:38 PM)BostonCard Wrote: Funny you mention the Spanish Flu. In context, I understand you to mean that the "elites" of the day in 1918 stood aside and let the flu pandemic spread without implementing any social distancing measures. Not only is that false, but it turns out that the regions of the country where more stringent measures were adopted not only had fewer deaths than those who delayed implementing social distancing measures, but also that those regions did better economically.
I don't think I ever said or implied that the authorities in 1918 stood aside. Obviously, they took what steps were available to them to prevent the spread of the flu. But they didn't shut down their economy like we've done.
a big part of actions (or lack thereof) in the 1918 flu pandemic was a desire to not upset the war machine and to not create any havoc in those supply chains or both materials and soldiers.
I'll again recommend reading "The Great Influenza"
RE: The coming decade-long depression - dabigv13 - 06-03-2020
(06-03-2020, 01:18 PM)82lsju Wrote:(06-03-2020, 11:49 AM)Mick Wrote:(06-01-2020, 02:38 PM)BostonCard Wrote: Funny you mention the Spanish Flu. In context, I understand you to mean that the "elites" of the day in 1918 stood aside and let the flu pandemic spread without implementing any social distancing measures. Not only is that false, but it turns out that the regions of the country where more stringent measures were adopted not only had fewer deaths than those who delayed implementing social distancing measures, but also that those regions did better economically.
I don't think I ever said or implied that the authorities in 1918 stood aside. Obviously, they took what steps were available to them to prevent the spread of the flu. But they didn't shut down their economy like we've done.
a big part of actions (or lack thereof) in the 1918 flu pandemic was a desire to not upset the war machine and to not create any havoc in those supply chains or both materials and soldiers.
I'll again recommend reading "The Great Influenza"
Nearly finished with it. The echoes to today are striking. Masks being pilloried as for the weak, or in fact that being scared of the virus actually makes your immune system weaker and more vulnerable. Churches complaining about unequal treatment in closures. Rumors that the virus is getting weaker. Oh its just the flu. The best part of the book though is that it uses some of the leading scientists and doctors of the time as the main characters, which gives the book a good narrative structure. Learned a lot about some of these figures that built modern American medicine, people like Welch, Osler, Flexner.
Also Mick is wrong, many cities closed large segments of their economies to deal with the virus. And the ones that were stricter and longer had less deaths and better economic results afterwards (as has been mentioned multiple times by multiple posters on this board.)
RE: The coming decade-long depression - 82lsju - 06-03-2020
(06-03-2020, 01:29 PM)dabigv13 Wrote: Nearly finished with it.
you might also like
"Flu: The Story of the Great Influenza Pandemic of 1918 and the Search for the Virus That Caused It"
RE: The coming decade-long depression - Mick - 06-04-2020
(06-03-2020, 01:29 PM)dabigv13 Wrote:(06-03-2020, 01:18 PM)82lsju Wrote:(06-03-2020, 11:49 AM)Mick Wrote:(06-01-2020, 02:38 PM)BostonCard Wrote: Funny you mention the Spanish Flu. In context, I understand you to mean that the "elites" of the day in 1918 stood aside and let the flu pandemic spread without implementing any social distancing measures. Not only is that false, but it turns out that the regions of the country where more stringent measures were adopted not only had fewer deaths than those who delayed implementing social distancing measures, but also that those regions did better economically.
I don't think I ever said or implied that the authorities in 1918 stood aside. Obviously, they took what steps were available to them to prevent the spread of the flu. But they didn't shut down their economy like we've done.
a big part of actions (or lack thereof) in the 1918 flu pandemic was a desire to not upset the war machine and to not create any havoc in those supply chains or both materials and soldiers.
I'll again recommend reading "The Great Influenza"
Nearly finished with it. The echoes to today are striking. Masks being pilloried as for the weak, or in fact that being scared of the virus actually makes your immune system weaker and more vulnerable. Churches complaining about unequal treatment in closures. Rumors that the virus is getting weaker. Oh its just the flu. The best part of the book though is that it uses some of the leading scientists and doctors of the time as the main characters, which gives the book a good narrative structure. Learned a lot about some of these figures that built modern American medicine, people like Welch, Osler, Flexner.
Also Mick is wrong, many cities closed large segments of their economies to deal with the virus. And the ones that were stricter and longer had less deaths and better economic results afterwards (as has been mentioned multiple times by multiple posters on this board.)
I would imagine that was due to the atypically high mortality rates of working-age Americans during the Spanish Flu epidemic. The considerable majority of COVID-19 deaths are found in post-retirement age Americans.
RE: The coming decade-long depression - 2006alum - 06-05-2020
In some good news, employment surged by 2.5 million in May, so perhaps the long-term consequences of the temporary lockdowns were overstated:
[tweet]https://twitter.com/CNBC/status/1268892384890322949?s=20[/tweet]
Economists had been forecasting anywhere between 2 and 8 million jobs lost in May. Talk about a swing and a miss there - and in the good direction, for once!
RE: The coming decade-long depression - OutsiderFan - 06-05-2020
Call me skeptical, but how do we have 1.9 million unemployment claims yesterday, while May is the largest job gain month on record?
RE: The coming decade-long depression - Hurlburt88 - 06-05-2020
I have also been trying to reconcile these different indicators. Perhaps "continuing claims" may be a better indicator that the weekly one-time claims?
RE: The coming decade-long depression - BostonCard - 06-05-2020
(06-05-2020, 06:55 AM)OutsiderFan Wrote: Call me skeptical, but how do we have 1.9 million unemployment claims yesterday, while May is the largest job gain month on record?
The Thursday number represents first time unemployment claims, so even as 1.9 million newly filed for claims, more may have gone back to work.
Note also that the surveys are run early in the month.
BC
RE: The coming decade-long depression - burger - 06-05-2020
(06-05-2020, 06:55 AM)OutsiderFan Wrote: Call me skeptical, but how do we have 1.9 million unemployment claims yesterday, while May is the largest job gain month on record?
I haven't looked at the numbers, but these could be different pools of workers. Restaurant workers and shop workers are probably going back to work in a lot of places. Meanwhile, the slowing economy might be trickling up to affect more white collar workers, owners, etc.?
It's probably pretty easy to see if that's true by diving into the numbers by job type (in other words, I'm lazy).
RE: The coming decade-long depression - 82lsju - 06-05-2020
(06-05-2020, 08:39 AM)burger Wrote:(06-05-2020, 06:55 AM)OutsiderFan Wrote: Call me skeptical, but how do we have 1.9 million unemployment claims yesterday, while May is the largest job gain month on record?
I haven't looked at the numbers, but these could be different pools of workers. Restaurant workers and shop workers are probably going back to work in a lot of places. Meanwhile, the slowing economy might be trickling up to affect more white collar workers, owners, etc.?
It's probably pretty easy to see if that's true by diving into the numbers by job type (in other words, I'm lazy).
Quote:Leisure and hospitality workers made up almost half the increase last month, with 1.2 million going back to work after a reported loss of 7.5 million in April. Jobs in bars and restaurants increased by 1.4 million as states began to relax social distancing measures.
Construction was the next biggest gainer with 464,000, making up for about half of April’s losses. Education and health services rose by 424,000 and retail surged by 368,000 after plunging by 2.3 million a month previous.
https://www.cnbc.com/2020/06/05/jobs-report-may-2020.html?__source=twitter%7Cmain
RE: The coming decade-long depression - BostonCard - 06-05-2020
Far be it for me to agree with Donald Trump, but I agree with his tweets. It is a stupendous number. And it does suggest that the economy is much more resilient than we thought.
BC
RE: The coming decade-long depression - 2006alum - 06-05-2020
From the department of deeply confusing explanations, this might account for why today's numbers don't seem to match the on the ground reality:
Quote:The official unemployment rate rose from 3.5 percent in February to 13.3 percent in May (down from its value in April). Even this very large official increase understates the increase in the unemployment rate from a historically-comparable perspective because it counts an extra 4.9 million people who were “not at work for other reasons” as employed and also because 6.3 million people left the labor force since February, more than would be expected even conditional on this large increase in unemployment. Adjusting for these factors our “realistic unemployment rate” was 17.1 percent in May, down from the April value but still higher than any other unemployment rate in over 70 years.
In total, an additional 14.5 million of the unemployed reported being on temporary layoff. If all of these people were immediately recalled back to work and the labor force adjusted accordingly—a very optimistic scenario—the “full recall unemployment rate” would still be a very elevated 7.1 percent. These data suggest the temporary labor market problems are very deep and that even if individuals on temporary layoff returned to work very quickly the United States would still have a recessionary level of unemployment for some time to come.
The irony, of course, is this comes from the same guy that was being pilloried for saying that Trump will be able to report extremely positive employment and economic numbers because we're likely to have a swift economic recovery: Jason Furman.
RE: The coming decade-long depression - BostonCard - 06-05-2020
Quote:After an exodus in April, the labor force in May increased by 1.75 million, pushing the participation rate to 60.8% from 60.2% in April. The total employment level as measured by the survey of households rose by 3.84 million while those who reported being unemployed plunged by 2.1 million, though it was still elevated at 21 million.
From the CNBC link. The increase in the labor force doesn't totally undercut Furman's argument (since there was a massive decline in the labor force in April), but it does mean that the change in unemployment rate from April to May did not occur because people gave up and left the labor force entirely.
We're not going to go back to the "before times" where the unemployment rate was under 5%. We may also see a lot of noise (and revisions) to the data, including possibly a month or two where things look to get worse. But I am much more hopeful than a few weeks ago that we will not get to 20% unemployment, and that the employment level when things settle down will be higher than I was afraid it might be. The GDP hit for the second quarter (April - June) may also be less dramatic than we were afraid of.
BC
RE: The coming decade-long depression - burger - 06-05-2020
(06-05-2020, 08:56 AM)BostonCard Wrote: Far be it for me to agree with Donald Trump, but I agree with his tweets. It is a stupendous number. And it does suggest that the economy is much more resilient than we thought.This is an awfully generous use of the world resilient. The 13.3% unemployment is still the second worst since the Great Depression, I believe. Trump's people are now saying that this means that we don't need any more stimulus from Congress. So, a bunch of unemployed people are going to start losing their extra $600 a month in July. And the extended regular unemployment benefits won't last forever either. Because the mythical 4th stimulus bill with aid for states and localities never passed, we're going to see a wave of layoffs of government employees starting very soon, too.
BC
Oh, and on top of all of that, numbers of cases and deaths are climbing in a bunch of states now, and I won't be surprised if it soon gets bad enough to require more lockdowns--or at least bad enough that people voluntarily stay home more. That won't help the economy either.
So, I don't see much to be optimistic about here.
RE: The coming decade-long depression - OutsiderFan - 06-05-2020
(06-05-2020, 09:45 AM)2006alum Wrote: From the department of deeply confusing explanations, this might account for why today's numbers don't seem to match the on the ground reality:
Quote:The official unemployment rate rose from 3.5 percent in February to 13.3 percent in May (down from its value in April). Even this very large official increase understates the increase in the unemployment rate from a historically-comparable perspective because it counts an extra 4.9 million people who were “not at work for other reasons” as employed and also because 6.3 million people left the labor force since February, more than would be expected even conditional on this large increase in unemployment. Adjusting for these factors our “realistic unemployment rate” was 17.1 percent in May, down from the April value but still higher than any other unemployment rate in over 70 years.
In total, an additional 14.5 million of the unemployed reported being on temporary layoff. If all of these people were immediately recalled back to work and the labor force adjusted accordingly—a very optimistic scenario—the “full recall unemployment rate” would still be a very elevated 7.1 percent. These data suggest the temporary labor market problems are very deep and that even if individuals on temporary layoff returned to work very quickly the United States would still have a recessionary level of unemployment for some time to come.
The irony, of course, is this comes from the same guy that was being pilloried for saying that Trump will be able to report extremely positive employment and economic numbers because we're likely to have a swift economic recovery: Jason Furman.
My head just exploded, because yes, that is irony.
I am not a conspiracy theorist and try hard to rely only on truth, but sometimes it's impossible to know, and all you can do is use past experience to make an assessment of what the truth is. My instinct is that if the Executive Branch has any ability whatsoever to influence numbers, nothing the government says can be trusted to be true at this point in American history. This is a White House that on the current POTUS's first day in office lied and gaslighted the country about the size of a crowd everyone could see with their own eyes. Does anyone think the White House is somehow above manipulating economic data for its own perceived political gain?
Ergo, I'm not going to say today's employment numbers are false, but I have no reason to believe they are true either.
(06-05-2020, 10:50 AM)BostonCard Wrote:Quote:After an exodus in April, the labor force in May increased by 1.75 million, pushing the participation rate to 60.8% from 60.2% in April. The total employment level as measured by the survey of households rose by 3.84 million while those who reported being unemployed plunged by 2.1 million, though it was still elevated at 21 million.
From the CNBC link. The increase in the labor force doesn't totally undercut Furman's argument (since there was a massive decline in the labor force in April), but it does mean that the change in unemployment rate from April to May did not occur because people gave up and left the labor force entirely.
We're not going to go back to the "before times" where the unemployment rate was under 5%. We may also see a lot of noise (and revisions) to the data, including possibly a month or two where things look to get worse. But I am much more hopeful than a few weeks ago that we will not get to 20% unemployment, and that the employment level when things settle down will be higher than I was afraid it might be. The GDP hit for the second quarter (April - June) may also be less dramatic than we were afraid of.
BC
Why was the Fed Chief on 60 Minutes clamoring for Congress to do more a couple weeks ago. I believe that was in support of a 4th bill. I doubt he would have blown his wad advocating for something that if not done, everything would be fine.
RE: The coming decade-long depression - Mick - 06-05-2020
(06-05-2020, 10:56 AM)OutsiderFan Wrote: Why was the Fed Chief on 60 Minutes clamoring for Congress to do more a couple weeks ago. I believe that was in support of a 4th bill. I doubt he would have blown his wad advocating for something that if not done, everything would be fine.
I share everyone's cynicism surrounding DoL numbers, given that they come from the executive branch. I don't trust it because they've started breaking it out by separate sets of numbers. The most recent release (Thursday mornings, 8:30 EST) can be found at this URL-->
https://www.dol.gov/ui/data.pdf
The seasonally adjusted unemployment rate is usually in the second paragraph (14.8%). The more useful unemployment number refers to
total number of people claiming benefits in all programs. For the week ending May 16 that number was was 29,965,415, a decrease of 991,744 from the previous week, which is a good sign. Doesn't mean we've turned it around, doesn't mean there won't be a hit from the protests, doesn't mean that as things open up and more people get infected it will be better or worse, but it's a positive, one-week indication that the numbers are about a million better than the previous week.
Incidentally, there were 1,534,449 persons claiming benefits in all programs in the comparable week in 2019. So...yeah.
As for Jay Powell, he has taken great pains to distance himself from the White House, as have, frankly, all of his predecssors. Greenspan, Volcker, et. al. were famously independent, as they should be. Powell has been uniformly negative on the economy. He thinks we're in real trouble. That they're even considering negative inflation rates is a real eye opener. He said at the end of April that the second quarter would be not only the worst the country had ever seen, but that it would be "unprecedented." He is saying we won't fully recover until the end of 2021. They're talking about the Fed lending directly to businesses. That would be a first.
And the Economist is saying that recent gains do not constitute a trend.
RE: The coming decade-long depression - BostonCard - 06-05-2020
Turns out a lot of the new jobs (250,000) were dentist offices.
https://www.fiercehealthcare.com/practices/healthcare-sector-jobs-increase-by-312k-may-thanks-to-dentist-offices
That sounds about right. I went to the dentist Monday, and it was newly re-opened. My dentist was available for emergency procedures, but cleanings and other elective procedures were shut down for all of April and May.
BC
RE: The coming decade-long depression - OutsiderFan - 06-06-2020
Friends don't let friends trust anything the current White House says about anything:
[tweet]https://twitter.com/tedlieu/status/1269137767578996737[/tweet]
RE: The coming decade-long depression - Mick - 06-06-2020
(06-05-2020, 09:26 PM)BostonCard Wrote: Turns out a lot of the new jobs (250,000) were dentist offices.
https://www.fiercehealthcare.com/practices/healthcare-sector-jobs-increase-by-312k-may-thanks-to-dentist-offices
That sounds about right. I went to the dentist Monday, and it was newly re-opened. My dentist was available for emergency procedures, but cleanings and other elective procedures were shut down for all of April and May.
BC
Also turns out a lot of the jobs were a mirage. Off by 3%, actual unemployment rate is likely to be 16.1%, not 13.3%
https://www.cnn.com/2020/06/06/politics/seth-harris-may-jobs-report-misclassification-error-cnntv/index.html#:~:text=(CNN)%20The%20former%20acting%20head,White%20House%20look%20better%2C%20and