Economic Outlook

Significant Stimulus Needed to Rebuild Economy, Poloz Says

Posted by Theophilos Argitis and Shelly Hagan

on Monday, 25 May 2020 12:25

Bank of Canada Governor Stephen Poloz, in his final speech before stepping down next week, said the deflationary risks associated with the pandemic and lockdowns are more concerning than the potential build up of inflationary pressures and vulnerabilities due to the extraordinary measures taken by policy makers.

“Although a minority of observers worry that these extreme policies will create inflation someday, our dominant concern was with the downside risk and the possibility that deflation could emerge,” Poloz said, according to remarks prepared for a speech to the University of Alberta…… click here for the complete article

Europe On The Brink Of Economic Crisis

Posted by AG Metalminer

on Thursday, 21 May 2020 7:10

France, heartbeat of the European social ideal, is facing an existential crisis caused by the impact of the lockdown of its economy.

Talk of a V-shaped recovery for much of Europe is thought to be laughable despite massive…click for full article.

China’s Newest COVID-19 Outbreak Shows Virus May Be Mutating

Posted by ZeroHedge

on Wednesday, 20 May 2020 10:29

During the earliest days of the pandemic, when medical journals like The Lancet were publishing some of the first non-peer-reviewed studies about the virus by scientists and researchers in China, experts warned about mutations in various strains of the virus, though they insisted that there was still no evidence to suggest that the virus was evolving into something more dangerous and more infectious.

Since then, a flood of new research has been published, and scientists have discovered more discouraging signs of mutation in samples of the virus. And yet, medical experts including Dr. Anthony Fauci have seemed at times overly eager to dismiss these mutations, and claim – without evidence – that there was no reason to believe the virus was evolving and changing in a way that might complicate efforts to create a vaccine.

Which is why we’re highlighting this Bloomberg report from yesterday describing the latest findings from doctors and researchers in northeastern China who are seeing the coronavirus manifest differently among patients in this new cluster, suggesting that the virus may indeed by changing in unknown ways and complicating efforts to stamp it out. CLICK for complete article

25% Of US Restaurants Will Never Reopen: Opentable

Posted by ZeroHedge

on Friday, 15 May 2020 11:04

A quarter of US restaurants will go out of business due to the COVID-19 pandemic, according to a forecast by OpenTable, which reported that total restaurant reservations and walk-in customers have fallen 95% over the previous year ending May 13.

At the state-level, Florida showed the greatest statewide gain, with foot traffic only down 83% y/y after launching a phased reopening May 4 during which restaurants were allowed to operate at one-quarter capacity.

Indiana, which is now in phase two – allowing restaurants to operate at 50% of capacity – has come in second. The state is planning on a full reopening by the Fourth of July.

“Restaurants are complicated beasts,” said Steve Hafner, CEO of OpenTable parent company, Booking Holdings. “You have to order food and supplies. You have to make sure you’ve prepped the kitchen and service areas to be easily disinfected.”

According to Hafner, state unemployment benefits with the federal booster is one reason why restaurants have struggled to hire help. “A lot of people are making $1,200 a week doing nothing. That’s good pay.”

Meanwhile, restaurateur Danny Meyer – who shut down all of his 19 New York restaurants on March 13, says his dining rooms will stay closed for the foreseeable future, according to Bloomberg…CLICK for complete article

Week 8 of the Collapse of the U.S. Labor Market: Nearing a Previously Unthinkably Deep Bottom?

Posted by Wolf Richter

on Thursday, 14 May 2020 10:41

“Insured unemployment rate” in California spiked to 27.7%, “continued claims” hit 4.8 million. In terms of “initial claims,” Georgia & Florida move into 1st and 2nd, ahead of California.

State unemployment offices have processed 2.98 million “initial claims” for unemployment  insurance in the week ended May 9, according to the US Department of Labor this morning. This brings the total number of initial claims processed over the past 8 reporting weeks since mid-March to a gut-wrenching 36.84 million (seasonally adjusted). Today’s claims were over four times the magnitude of the prior spikes in the unemployment crises in 1982 and 2009.

While the weekly explosion of initial claims has slowed from prior weeks, the number of people still filing for unemployment insurance in the week ended May 9 was still at a catastrophic level: CLICK for complete article