Wuhan Coronavirus: Economic Effects -

[Ivan Shatov]

Fuck it, im drunk and I’ve thought way too much about it.

Literally no one knows, least of which those in the economic circle.

Steve Bannon did an interview on Seeking Alpha recently, talking about the cost of globalization. It's getting some traction with groups that would not normally consider his perspective.

While I agree no one knows what's about to happen with the economy, my take is there's an increased awareness of the long-term cost of doing business with China. Trump issued an executive order called Buy American that will restrict purchases of essential supplies - masks and pharma included - to domestic manufacturers. It will not be implemented until we are done with the WuFlu mess.

At the same time, the House is empaneling a select committee to look into the WuFlu response. They say it's bipartisan, which means it's very partisan, and my take is the timing / subject is a little too conspicuous. The people on the panel are not going to do themselves any favors pointing fingers after a crisis, they have another agenda, and I'm pretty sure it's to stop Buy American from taking effect.

There are interests who would like to ensure that order is never implemented for all sorts of reasons that are not necessarily nefarious, it does mean the short-term cost of obtaining this equipment will go up while we're in a recession. The companies that can produce it, like 3M, were already hurting financially before this started, the Govt is going to be looking to them to pick up the slack on low-margin mass-production items for a purely domestic customer that demands just-in-time supply chains instead of stockpiles. Compared with cheap foreign imports, that's incredibly expensive to do operationally, just making reagents in the US is not something most companies would want to consider.

So what's going to happen with the economy? A recession for sure, along with stagnation while people sort out what to do about foreign powers controlling the supply of critical items. Dems will do everything in their power to avoid having the economy return between now and November. Wall Street will do everything in their power to ensure the availability of goods from anywhere on Earth at the lowest cost possible. This will cause fits and starts that will be hard to understand except in the macro.

And that's why no one knows what's going to happen. It's going to be a brawl with no certain outcome, chaos that favors radical approaches. The prospectus for the next decade has been radically altered.

 

[HeyItsHarveyMacClout]

Steve Bannon did an interview on Seeking Alpha recently, talking about the cost of globalization. It's getting some traction with groups that would not normally consider his perspective.

While I agree no one knows what's about to happen with the economy, my take is there's an increased awareness of the long-term cost of doing business with China. Trump issued an executive order called Buy American that will restrict purchases of essential supplies - masks and pharma included - to domestic manufacturers. It will not be implemented until we are done with the WuFlu mess.

At the same time, the House is empaneling a select committee to look into the WuFlu response. They say it's bipartisan, which means it's very partisan, and my take is the timing / subject is a little too conspicuous. The people on the panel are not going to do themselves any favors pointing fingers after a crisis, they have another agenda, and I'm pretty sure it's to stop Buy American from taking effect.

There are interests who would like to ensure that order is never implemented for all sorts of reasons that are not necessarily nefarious, it does mean the short-term cost of obtaining this equipment will go up while we're in a recession. The companies that can produce it, like 3M, were already hurting financially before this started, the Govt is going to be looking to them to pick up the slack on low-margin mass-production items for a purely domestic customer that demands just-in-time supply chains instead of stockpiles. Compared with cheap foreign imports, that's incredibly expensive to do operationally, just making reagents in the US is not something most companies would want to consider.

So what's going to happen with the economy? A recession for sure, along with stagnation while people sort out what to do about foreign powers controlling the supply of critical items. Dems will do everything in their power to avoid having the economy return between now and November. Wall Street will do everything in their power to ensure the availability of goods from anywhere on Earth at the lowest cost possible. This will cause fits and starts that will be hard to understand except in the macro.

And that's why no one knows what's going to happen. It's going to be a brawl with no certain outcome, chaos that favors radical approaches. The prospectus for the next decade has been radically altered.

Couldnt agree more. The only good thing that has come from this is that the American economy is further decoupling from China. Companies already wanted to move their production lines out of there for a while due to rising labor costs and beauracratic red tape, but it was too costly for the returns. This should hopefully be the excuse that many companies need to get out of China.

 

[Otterly]

How much did insurance of any kind cover the pandemic?

Think it may count as force majeure ?

Freddos are going to increase in price AGAIN. It’s disgusting and inhumane.

as long as the tea keeps flowing we will manage

I was musing on the impact of nature on the economy. don’t forget there was a big ecological component to the depression. The dust bowl was a contributor to it and to the migration and hunger that accompanied the depression. Partly ecological, due to drought, and party human action, with bad farming techniques (cotton, machinery.). Big ecological events almost always contribute to unrest in one form or another, and along with human actions they are often the trigger for bad things. This plague can be viewed partly as such an event - human action has made it worse but it is at its core a biological event.

I dont know how it will all pan out but if we don’t see at least a couple of regimes implode and a few regional conflicts, I’ll be surprised. Humanity is in for a rough few years. And after that, a boom, because that usually follows.

 

[Not Really Here]

I doubt inflation will be a very big deal(Obama's 10 trillion in debt in 8 years didn't do much) mainly because the cash gets funneled pretty quickly to large corporations that then re-invest.
Really, this is a pretty good time to lose the economic dead weight in a market correction.

 

[millais]

A lot of the banks are opening up their SBA loan programs today, and the system is getting flooded with an overload of applicants. Just like how unemployment benefit applicants were applying in the millions earlier this week and overloading the phone lines and website. Same thing is now happening with small businesses applying for those SBA loans.

 

[greengrilledcheese]

Wouldn't be surprised if that really helps the DSA crowd.

All it would take is a sane person going to one DSA meeting to totally discount them as a bunch of loons.

 

[Kacho]

Something to consider when it comes to inflation. Most businesses won't be able to raise their prices in the near future because demand for most things has cratered as has spending power. People are out of work, getting their hours cut, they have less money in pocket and fewer opportunities to spend because of isolation/quarantine/closure/distancing/etc. So most places will be lowering prices on goods to try and get people to spend. At the same time the stimulus is being provided via newly printed money rather than borrowed money. So there will be more money in circulation at a time when prices on most goods are the same or lower. It's optimistic but this specific confluence of events might actually produce a little negative inflation this spring and summer.

 

[Cypher]

For now, nobody, not even the Government, knows what is going to happen, but it doesn't look good. 6.6mil Jobless claims, stonks losing almost 10 points from just last month while going into uncharted territory of whether it's going to keep falling or stabilizing, oil prices getting raped (most in part thanks to Saudi-Russia tug of war), companies like the Airlines are on the way to a bloodbath and begging for bailouts, basically every estimate from the Fed to Goldman-Sachs is them running around with their heads screaming of a soul-crushing recession, and the Fed is desperately pumping to keep this fucker from making Wall Street jump off buildings (going to absolutely fuck our inflation rate, but as people said above it could be solvable), and a bunch of other shit I forgot.

It's not even May. This virus ain't gonna burn itself out til Summer globally, and that's hopefully if it doesn't come back in Autumn or hit the Southern Hemisphere when the seasons flip. Vaccines aint coming til at least the end of the year. The virus couldn't have come at a worse time right now in the current state of the world with a Zombie economy that was resuscitated from flatlining back in 2008. We won't have a 1930s depression though, just too improbable and is more of a Worst case scenario.

Realistic case for now sounds like a recession worse than '08 that might last a few years. Other than that there's a bunch of geopolitical shit that it's going to happen as a result from this, but that's not what this thread is about.

 

[Jump]

The only reason those numbers are not higher is because people haven't filed yet or their state's website is choking and the physical offices are closed.
Our system is COBOL bassed and is already running backlog. 3 weeks just to process the requests sitting on the website.

Since this reply the backlog has jumped to 4-6 weeks. Not to get your check, but to just get your application in the system. So a job lost today wont hit the unemployment numbers for 4-6 weeks from now. We really have NFC how bad it really is (or isnt) here.

It goes like this:
You -> Website form -> State bureaucrat -> mainframe
Shit like this is never automated because that would mean a loss of union state labor. If the DOL building gets infected and shutdown for de-con then no applications will get processed.

 

[Ivan Shatov]

Kissinger had this to say.

https://archive.md/cyItf

I didn't post the whole article because I'm not sure what is still allowed in happenings, but basically - he's saying it's our responsibility to solve everything.

Kissinger is generally someone I agree with in writing and not in practice. Having a hard time squaring this with the rest of the world's response. He may be stuck in 1972.

 

[Kiwi Lime Pie]

In other news, our unemployment claims are so high that they have appointed days to file based on your last name, and even so the government's website keeps crashing.

I don't think anyone in charge expected there to be such a high volume of claims that would be processed in such a short amount of time when the decision was made to close regional branch offices and require everyone to file claims via telephone or the internet. I can only hope the UIA grants relief to anyone who is unable to file claims within the expanded 28-day window if they an show they had been trying for the entire time.

What might not help the situation is that the first quarter ended March 31. As a result, employers have to use the MiWAM (online) system to file their quarterly wage report by April 25 unless that deadline was changed without much announcement or fanfare. Although the employer portion of the system doesn't seem to be bogged down for now, it's possible employers logging in to submit their reports still affect system performance for everyone else trying to log in.

Further frustrating both employers and claimants is that the shutdown on nonessential personnel might be why there's fewer UIA staff members available to answer questions over the phone. I suspect the same may be true for e-mail inquiries. Right now, it's unfortunately not uncommon, for people to work their way through the phone tree and have their call abruptly disconnected because either (1) nobody is available, or (2) the system is too overloaded to properly route the call to the requested department.

Our system is COBOL bassed and is already running backlog. 3 weeks just to process the requests sitting on the website.

Sadly, that doesn't surprise me with any legacy system maintained by a government entity.

Since this reply the backlog has jumped to 4-6 weeks. Not to get your check, but to just get your application in the system. So a job lost today wont hit the unemployment numbers for 4-6 weeks from now.

This has to be particularly frustrating for those out of work and in desperate need of unemployment benefits to stay on top of their essential monthly expenses. To be told they have to wait almost two months for their first check has to have them sweating, especially if they lack the savings or resources to get through the initial waiting period while no income comes in.

If the pandemic lasts through the summer, one wonders how much more the economy will struggle, how many more people may need unemployment, and what -- if anything -- local and federal government would do to keep citizens and small businesses afloat.

 

[pwnest injun]

How much did insurance of any kind cover the pandemic?

I don't know a single business whose insurance has covered their losses. On that note, car insurance must be making huge profits from everyone staying off the road.

 

[Aqua Panda]

So I'm seeing more and more stores go cashless and demand using a debit/credit card to shop in store now.

I know in a few areas, there are laws banning this, but I have to wonder if we will see stores lobby to keep doing it.

 

[pwnest injun]

Here in Oregon there's a small business assistance program that's going to help out 150 businesses, starting with the gayest, blackest, transest businesses first, naturally.

 

[Save the Loli]

Here in Oregon there's a small business assistance program that's going to help out 150 businesses, starting with the gayest, blackest, transest businesses first, naturally.

So 149 gay bars and hipster troon cafes and the best place to get weaves in Portland?

 

[Crunchy Leaf]

A lot of the banks are opening up their SBA loan programs today, and the system is getting flooded with an overload of applicants. Just like how unemployment benefit applicants were applying in the millions earlier this week and overloading the phone lines and website. Same thing is now happening with small businesses applying for those SBA loans.

They've changed the rules for SBA loans to include sole proprietors, so now more businesses are eligible.

I was rejected for unemployment because I didn't make enough to qualify, but they sent me an unemployment debit card anyway...with zero dollars. Thanks?

 

[Wargarbl]

Africa bracing for ‘complete collapse of economies’ as coronavirus takes its toll (archive)

They could have just said "Africa mostly unaffected by corona". I guess that doesn't really get the gibsmedats flowing, though.

 

[A_Rotten_Sharwama]

China will seize their early end quarantine and became the number one superpower, and declare war on Taiwan, or Japan, or Hong Kong, or India, or Tibet which led to WWIII and end us all with fucking nukes.

To justify me spending all my life saving on fucking freeze-dried emergency food.

 

[CeleryStalks]

Pandemic leaves hospitals, newspapers in the same boat

The crisis is highlighting the disconnect between what makes both industries vital and what makes them profitable

www.freep.com

(archive)
Article on the economic woes of hospitals and newspapers during this crisis.
TL;DR Hospitals derive most of their revenue from elective surgeries, diagnostic testing, and outpatient and home care, all of which are being cut back or suspended right now.
Newspapers similarly are dependent on advertising revenue, and companies are trimming their advertising budgets.
The author claims that some believe this crisis may provide an opportunity for the government to finally create a single-payer health care system, since hospitals will be going bankrupt, insurance premiums will be skyrocketing, and millions of newly unemployed workers will have lost their employer-provided health insurance anyway.
Edit: The author himself doesn't make any claims about the future of healthcare; he just reports what some people are thinking.

 

[Save the Loli]

Africa bracing for ‘complete collapse of economies’ as coronavirus takes its toll (archive)

They could have just said "Africa mostly unaffected by corona". I guess that doesn't really get the gibsmedats flowing, though.

Why don't African countries just not do the lockdowns and shit? A plague like this is nothing in Africa, and it'll clear out people with AIDS like nothing else thus cutting down the spread of that disease and causing long-term savings. The population loss just reduces overpopulation and they'll gain it all back and more in a few years anyway.

Or are they just expecting their people not to listen, bother, or care and just pay off the police who come to enforce it?