1) Speculation abounds over what the next stimulus package will have, such as extended income support for the unemployed and underemployed. New temporary subsidies for low wage workers. Cheap loans for small and medium size businesses with additional support for state and local governments. Cost estimates for a second stimulus program range from one to two trillion dollars. But like the first stimulus package, no one is offering ideas how this money will be paid off, especially if economic expansion doesn’t materialize.
2) The worlds fastest super computer is now Japan’s Fugaku supercomputer developed by Riken and Fujitsu with backing from the Japanese government. It has a speed of roughly 415.53 petaflops, which is 2.8 times faster than the US Summit supercomputers at 148.6 petaflops. The Fugaku was under development for six years and will start full time operation by April 2021, although it has been pressed into service in the coronavirus crisis, running simulations on how droplets would spread in office spaces with partitions. Previously, the fastest supercomputers have belong to America and China.
3) The sales of existing homes has dropped in May, a result of the coronavirus impact on the economy. The sales of existing homes in May fell 9.7% compared with April, which makes for an annual decline of 26.6%. This is the largest decline since 1982 when interest rates were 18%. There remains a shortage of housing which is helping to uplift the market, and therefore the economy as soon as the crisis has subsided.
4) Stock market closings for – 22 JUN 20:
Dow 26,024.96 up 153.50 Nasdaq 10,056.48 up 110.35 S&P 500 3,117.86 up 20.12
1) Experts say it could take as much as a decade for America’s economy to fully recover from the coronavirus and the subsequent massive shutdown of businesses. Presently, it’s expected that the GDP (Gross Domestic Product) will decrease about 3% from 2020 to 2030 or about $7.9 trillion dollars. It’s expected that the measures to counter the virus, the business closures and social distancing measures, will reduce consumer spending, which in turn will cool the economy. With 41 million people now unemployed, more layoffs are expected for the next week with an unemployment rate of 19.6%. Furthermore, it’s expected that the coronavirus will cost the economic about $7.9 trillion dollars.
2) The reopening of America from the lockdown was going to be difficult enough, but now the growing violence of protest is threatening to hamper that recovery. Stores in the protest areas are closing for the protection of its employees such as CVS and Target, with doubts mounting if some of the stores will ever reopen. Mayor Lightfood of Chicago said the continuing violence is making the city reconsider the opening of Chicago’s businesses. Also, the wireless carriers T-Mobile has closed Metro and Sprint stores over the same consideration of possible violence.
3) China has stopped some imports of U.S. farm products such as soybeans and pork meat. This is the latest sign that the January phase one trade deal between the world’s two largest economies is unraveling. The halts come after President Trump’s criticism of China’s efforts to bring Hong Kong under the firm control of the communist. The president is threatening to strip Hong Kong of some of it’s special privileges, which in turn would make Hong Kong less valuable economically to China. Further aggravating U.S. and Chinese relations is the charges that China shares some responsibility for the Convid-19 pandemic.
4) Stock market closings for – 1 JUN 20:
Dow 25,475.02 up 91.91 Nasdaq 9,552.05 up 62.18 S&P 500 3,055.73 up 11.42
1) The coronavirus economic troubles has reached out to touch social security. The social security is financed by the payroll tax, those social security deductions on worker’s paycheck and the SSI employers pay for each worker. With a little over 30 million people now unemployed, one out of every six American workers, the monies needed by the government to send out social security checks has been drastically reduced. But the government’s obligation has not been cut, they are sending out the same amount each month, so the government must spend monies they get from other sources. The social security program is the largest single source of federal spending, which is now even more shakier than before.
2) More states are beginning the process of relaxing restrictions on businesses and shut down orders. About half of the states are retracting closing orders for businesses deemed nonessential allowing them to open for business again. The states are using a patchwork of strategies to reopen, based on the type of business and how their operations expose the public to infection of the virus. Two states with large populations, Texas and Ohio, have joined in the reopening process. States are feeling enormous pressure to restart businesses and restore social life, mostly in the South, Midwest and mountain West leading the way. There are big questions if the reopening is too early, that the waning virus infection might suddenly erupt in force.
3) American colleges and universities are also facing crippling financial difficulties from the coronavirus impact, with some small colleges already closing. They are having to bear the cost of having to suddenly shift to online classes, giving partial reimbursements of room and board, plus deferring summer secession without a change in their fixed cost of operations. Many experts considering the college education system is being forever changed in America.
4) Stock market closings for – 1 MAY 20:
Dow 23,723.69 down 622.03 Nasdaq 8,604.95 down 284.60 S&P 500 2,830.71 down 81.72
1) The American unemployed continue to climb with an additional 4.4 million for last week. This brings the five week total of more than 26 million workers now unemployed in America, or about 16% of the labor force. Nearly one in six workers have lost their jobs in the last few weeks. But because of lags in the reporting system, these numbers don’t fully show the extent of the problem. With people needing money to pay rents, mortgage, buy food and pay utilities, state governments are facing increasing pressure to retract the ‘shelter at home’ orders and forced closing of businesses, despite dangers of virus flare-ups. Experts warn such moves could undo all the containment that’s been accomplished at the economic cost of the last five weeks. To make things worst, layoffs are expected to continue, that we have not reached the unemployed plateau yet. State, county and city workers may form the next wave of layoffs as tax revenues needed to pay salaries plunge from the pandemic.
2) The clothing retailer Gap, has warned that its existing cash reserves may not be enough to continue operations, something that mirrors the predicament of so many American businesses, especially small businesses. The company says it must take further actions to find liquidity over the next twelve months, including job cuts and new debt financing. The chain has stopped paying rent for its stores, thereby amassing an additional debt of $115 million dollars. Its stock has fallen nearly 60% this year.
3) The coronavirus pandemic is spawning another economic consequence- lawsuits! Carnival Corp. is facing suits from several passengers who claimed they weren’t warned of the high risk from virus onboard ships. Wells Fargo, Bank of America, JP Morgan Chase and US Bancorp are being sued by small businesses who missed out on coronavirus rescue loans. Even universities are threaten with lawsuits for reimbursements of tuition, fees and housing. Judging from past disasters, it’s expected that more lawsuits will emerge in waves, as people seek someone to blame for their misfortunes while opportunistic attorneys capitalize on the crisis.
4) Stock market closings for – 23 APR 20:
Dow 23,515.26 up 39.44 Nasdaq 8,494.75 down 0.63 S&P 500 2,797.80 down 1.51
1) A second round of layoffs is starting, the first being workers at restaurants, malls and hotels, most of them lower skill levels, but now it’s higher skilled jobs threatened. Those higher skilled jobs had seemed secure, however the ‘work at home’ people are seeing layoffs and furloughs to add to the unemployed numbers. Jobs such as corporate lawyers, government workers and managers are seeing the pink slip with a threat of a prolonged labor downturn in 2007-09 recession. Economist anticipated that 14.4 million jobs will be lost in coming months, raising the unemployment rate to 13% for June. Already, 17 million Americans have been laid off, with estimates of 27.9 million jobs to be lost. The information businesses are being hit, with revenues not sufficient to pay electric bills for servers and computers to host web sites. Even large law firms catering to the corporate world are having significant layoffs. State and local governments employ 20 million people, but as tax revenues drop, they too are faced with reducing employees. Analysts consider it will take 5 1/2 years for the labor market to recover.
2) Boeing, the airline manufacture, is further suffering business setbacks with the cancellation of orders for 150 jets in March. This is a result of a near total halt in demand for air travel because of the coronavirus pandemic. There are now nearly 14,000 jets parked by airlines around the world. Boeing did report new orders for 31 aircraft in March. While Boeing still has a backlog of orders for about 5,000 jets, there are fears that delivery will be deferred which will further add to Boeing’s financial woes.
3) The IMF (International Monetary Fund) is predicting that the Great Lockdown recession will be the worst in almost a century, warning the world economy’s contraction and recovery will be worst than anticipated. The IMF estimates the global gross domestic product will shrink 3% this year, compared to a 3.3% growth in January. This will dwarf the 0.1% contraction in the 2009 financial crisis. These forecast dashing any hopes for a V-shaped economic rebound after the virus subsides, with a commutative loss of global GDP of this and next year, of about $9 trillion dollars. Economic damage is driven by how long the virus remains a major threat.
4) Stock market closings for – 14 APR 20:
Dow 23,949.76 up 558.99 Nasdaq 8,515.74 up 323.32 S&P 500 2,846.06 up 84.43
1) Family Dollar store is shutting down 400 of its stores while planning to open another 1,000 stores. Sales continue to drop as the corporation experiments on pricing-product mix to revitalize its revenues.
2) Amazon announced it is closing all of its 87 ‘pop-up’ stores. The pop-up store is actually a kiosk placed in major retail stores that allow people to try out some Amazon products and services. Amazon is exploring other strategies of expanding into the consumer market.
3) Analyst have worried that hiring would slow as the pool of unemployed people shrank, but it turns out that millions of people who had dropped out of the job market and therefore were not being counted as unemployed anymore, are returning to the job market.
4) 7 MAR 19 Stock market closings:
Dow 25,473.23 down 200.23 Nasdaq 7,421.46 down 84.46 S&P 500 2,748.93 down 22.52