Sinking U.S. economy hasn’t hit bottom yet

[libertybele]

Sinking U.S. economy hasn’t hit bottom yet

The coronavirus capsized what had been the longest expansion in U.S. history. Now the wait is on to see how far the economy sinks before it finds bottom.

A few dimly hopeful signs emerged last week as a pair of reports showed consumer confidence stabilizing toward the end of the April, largely on the flickering hope that the economy will start to rebound during the summer. Another poll found that Americans think four of five jobs lost due the coronavirus will return.

Even just a month ago, many economists might have agreed, but now they see a longer slog ahead. The era of social distancing spawned by the COVID-19 pandemic will reshape economies, they say, and leave many industries that rely on large crowds gasping for economic breath. They include retailers, restaurants, hotels, airlines, resorts, casinos and sports venues.

“I think there is going to be a longer adjustment process during the summer,” said Dave Donabedian, chief investment officer of CIBC Private Wealth Management. “The bigger question is, when those businesses reopen do their customers show up. And do workers want to come back.”

But that’s in the future. The immediate present still shows the economy descending to depths it hasn’t experienced at least since the 1930s Great Depression.

The initial look at first-quarter gross domestic product, for example, is expected to show a 3.3% decline in economic growth, according to a MarketWatch survey. Such a drop would be the deepest since 2009 during the Great Recession, but it pales in comparison to a predicted plunge of 25% or more in the second quarter......

https://www.marketwatch.com/story/sinking-us-economy-hasnt-hit-bottom-yet-2020-04-25?mod=home-page

[cato potatoe]

A few dimly hopeful signs emerged last week as a pair of reports showed consumer confidence stabilizing toward the end of the April, largely on the flickering hope that the economy will start to rebound during the summer. Another poll found that Americans think four of five jobs lost due the coronavirus will return.

Which is why now is the critical time to collect any outstanding receivables.  Wait another month, and you aren't getting paid.

[Absalom]

Consider the Airline, Banking and Energy industries; fundamental to any sound first world economy.
All have been badly damaged and not yet bottomed, despite the happy talk from our political assholery.

[massadvj]

The "bottom" will hit in about six months or so as delinquent mortgages and rents, combined with a sluggish recovery for travel and hospitality, cause a ripple effect throughout the economy.  It is going to be uglier in Europe and Latin America, but we will see economic hardship on a level not seen since the Great Depression.

Trump will be toast, I am sorry to say.  He is going to get blamed, unfairly, but that is the nature of politics.  Presidents take the credit when times are good, they suffer the consequences when things go south.

[Absalom]

The "bottom" will hit in about six months or so as delinquent mortgages and rents, combined with a sluggish recovery for travel and hospitality, cause a ripple effect throughout the economy.  It is going to be uglier in Europe and Latin America, but we will see economic hardship on a level not seen since the Great Depression.
Trump will be toast, I am sorry to say.  He is going to get blamed, unfairly, but that is the nature of politics.  Presidents take the credit when times are good, they suffer the consequences when things go south.

----------------------------
Intuitive and perceptive.

[Smokin Joe]

The "bottom" will hit in about six months or so as delinquent mortgages and rents, combined with a sluggish recovery for travel and hospitality, cause a ripple effect throughout the economy.  It is going to be uglier in Europe and Latin America, but we will see economic hardship on a level not seen since the Great Depression.

Trump will be toast, I am sorry to say.  He is going to get blamed, unfairly, but that is the nature of politics.  Presidents take the credit when times are good, they suffer the consequences when things go south.

I must say I hope you are wrong, especially when I see that the vast majority of the real incompetence in this was perpetrated by communists and their fellow travelers, foreign and domestic.

If Trump loses, the prospects are grim. There is no oil industry incentive to pull the country up by its bootstraps, and we produce more than we use now. So what will pull the economy out of the tailspin in a Democrat administration?

Even more, with the idea that the Dems are fighting, in some cases literally, to stay free to damage this country as their perfidy is exposed behind the smoke and mirrors associated with the Wuhan BSL Virus (SARS-CoV-2), having that lot in charge will likely lead to upheaval.

[DB]

I must say I hope you are wrong, especially when I see that the vast majority of the real incompetence in this was perpetrated by communists and their fellow travelers, foreign and domestic.

If Trump loses, the prospects are grim. There is no oil industry incentive to pull the country up by its bootstraps, and we produce more than we use now. So what will pull the economy out of the tailspin in a Democrat administration?

Even more, with the idea that the Dems are fighting, in some cases literally, to stay free to damage this country as their perfidy is exposed behind the smoke and mirrors associated with the Wuhan BSL Virus (SARS-CoV-2), having that lot in charge will likely lead to upheaval.

With someone else on the Republican presidential ticket the odds would be better.

[Smokin Joe]

With someone else on the Republican presidential ticket the odds would be better.

I'm seeing a lot of MEDIA driven disillusionment with Trump over the Chicom Virus. The doctors will prevail, we'll get past the disease, and eventually there will likely be a vaccine. There are a number of treatments being tested, some poorly tested, because essential elements are left out of the pharmacology, but tested nonetheless.  Where the full pharmacology is used (Hydroxychloroquine, Azithromycin, AND Zinc Sulfate), the results have been reported as very good.
The challenge will be to rebuild a severely damaged economy.

So, I have to ask, which politician (most have never had a real job) do you think could do a better job of shepherding the rebuilding of the American economy?

[massadvj]

If Trump loses, the prospects are grim. There is no oil industry incentive to pull the country up by its bootstraps, and we produce more than we use now. So what will pull the economy out of the tailspin in a Democrat administration?

The answer is "nothing."  It will be like the Great Depression, which were the glory days of the Democratic Party.  Democrats still celebrate the depression, and they celebrate its architect FDR as the greatest president in history.  And why not?  Their dream of a permanent underclass living in fear and voting the party line year after year was fully realized.

The era of the Great Depression was the closest this country ever got to becoming a communist state.  Everyone waited in line for basic necessities, they never complained, and they worshiped the president who offered them the tiniest morsels for their loyalty to his policies, all of which exacerbated our economic problems and extended the misery.  In fact, I dare say FDR was our one and only "dictator for life."

Fast forward to today, and what do we see?  People cowering in their homes, accepting the edicts from their leaders, almost every one of which violates a constitutional right.  We are all hunkered down thinking the quarantine will cause fewer people to die, when in fact it will only extend the period of time over which people will get their tickets punched by this virus.  The longer we quarantine, the more people will ultimately die from ALL causes, because the same number of people will die from COVID-19, while more people will die from diseases related to economic hardship.

Don't think for a moment that our leaders do not know this.  And yet not a single one, from Trump on down (with the single exception of the governor of Georgia) has the guts to tell the American people the truth about it.

[Smokin Joe]

The answer is "nothing."  It will be like the Great Depression, which were the glory days of the Democratic Party.  Democrats still celebrate the depression, and they celebrate its architect FDR as the greatest president in history.  And why not?  Their dream of a permanent underclass living in fear and voting the party line year after year was fully realized.

The era of the Great Depression was the closest this country ever got to becoming a communist state.  Everyone waited in line for basic necessities, they never complained, and they worshiped the president who offered them the tiniest morsels for their loyalty to his policies, all of which exacerbated our economic problems and extended the misery.  In fact, I dare say FDR was our one and only "dictator for life."

Fast forward to today, and what do we see?  People cowering in their homes, accepting the edicts from their leaders, almost every one of which violates a constitutional right.  We are all hunkered down thinking the quarantine will cause fewer people to die, when in fact it will only extend the period of time over which people will get their tickets punched by this virus.  The longer we quarantine, the more people will ultimately die from ALL causes, because the same number of people will die from COVID-19, while more people will die from diseases related to economic hardship.

Don't think for a moment that our leaders do not know this.  And yet not a single one, from Trump on down (with the single exception of the governor of Georgia) has the guts to tell the American people the truth about it.

Then what we need to avoid at all costs is another Depression. (No mention of the millions of people who have lost their health insurance during this thing, either. )

Well, what I am hoping:
That there is at least one viable course of medication for the COVID-19 disease (and it appears to be so where the medications are properly administered) .
That the number of asymptomatic infections and mild cases which did not seek medical attention and were not tested will turn out to be far greater than current data show.
If that is so, then the country can be opened up much sooner and some of this damage mitigated.
Additionally, those petty tyrants who are letting this go to their heads can face the music as people who are P.O.ed can 'come out to play' without fear of arrest.
And that the Democrats get their asses handed to them in November.

[jmyrlefuller]

Consider the Airline, Banking and Energy industries; fundamental to any sound first world economy.
All have been badly damaged and not yet bottomed, despite the happy talk from our political assholery.

Consider, though:

The late 1990s economic boom was fueled by $1/gallon gas, ended when gas prices rose.
The late 2000s economic crash was fueled by $4/gallon gas.

With a glut of cheap gas on the market, that will reduce overhead for transport, which is potentially good news.

[LMAO]

The answer is "nothing."  It will be like the Great Depression, which were the glory days of the Democratic Party.  Democrats still celebrate the depression, and they celebrate its architect FDR as the greatest president in history.  And why not?  Their dream of a permanent underclass living in fear and voting the party line year after year was fully realized.

The era of the Great Depression was the closest this country ever got to becoming a communist state.  Everyone waited in line for basic necessities, they never complained, and they worshiped the president who offered them the tiniest morsels for their loyalty to his policies, all of which exacerbated our economic problems and extended the misery.  In fact, I dare say FDR was our one and only "dictator for life."

Fast forward to today, and what do we see?  People cowering in their homes, accepting the edicts from their leaders, almost every one of which violates a constitutional right.  We are all hunkered down thinking the quarantine will cause fewer people to die, when in fact it will only extend the period of time over which people will get their tickets punched by this virus.  The longer we quarantine, the more people will ultimately die from ALL causes, because the same number of people will die from COVID-19, while more people will die from diseases related to economic hardship.

Don't think for a moment that our leaders do not know this.  And yet not a single one, from Trump on down (with the single exception of the governor of Georgia) has the guts to tell the American people the truth about it.

I agree with many of these points but there are some differences today than they were in the 1930s. For one, trust in the media is at an all time low. People also trusted their leaders more in the 1930s than they do today. And there is more oppositional media today than during the Great Depression  era

 Back in 2008,  with the onslaught of the Great Recession, the Democratic Party won everything. In fact, I remember many pundits  comparing  it to the FDR years. Two years later, the Democrats lost the House and even some state houses which would continue all the way to the end of Obama’s term

[Smokin Joe]

Consider, though:

The late 1990s economic boom was fueled by $1/gallon gas, ended when gas prices rose.
The late 2000s economic crash was fueled by $4/gallon gas.

With a glut of cheap gas on the market, that will reduce overhead for transport, which is potentially good news.

about those late 2000s, frankly, $4 gas didn't cause the banking bailouts, that was from the housing bubble and beyond that, derivatives. In January of 09 oil was at <$55/bbl.

From: https://seekingalpha.com/article/4339980-macroview-oil-price-crash-was-inevitable]/bbl.

From: https://seekingalpha.com/article/4339980-macroview-oil-price-crash-was-inevitable

The Link To Oil

Oil is a highly sensitive indicator relative to the expansion or contraction of the economy. Given that oil is consumed in virtually every aspect of our lives, from the food we eat to the products and services we buy, the demand side of the equation is a tell-tale sign of economic strength or weakness.

The chart below combines interest rates, inflation, and GDP into one composite indicator to provide a more evident comparison to oil prices.

The primary driver of cheap oil was the failure of the Saudis and Russians to agree on production quotas at OPEC+, and with the walkout came overproduction which created a coming glut. Prices had dropped to the $20 level in early March, just before COVID-19 took over the airwaves. There was already excess supply, globally, and the absence of demand produced by shutdown orders over COVID-19 was a second blow to the industry which created storage problems which put WTI in negative territory, something unprecedented.

This chart shows oil prices over time better, https://www.macrotrends.net/1369/crude-oil-price-history-chart

[Fishrrman]

Victor wrote:
"Trump will be toast, I am sorry to say.  He is going to get blamed, unfairly, but that is the nature of politics.  Presidents take the credit when times are good, they suffer the consequences when things go south."

Then that means Joe Biden as president for a very short while, to be quickly followed by his resignation (or removal) and the ascendance of whomever is chosen for him to run as the VP candidate.

It will almost certainly mean a democrat-communist Senate and House, as well.

That means hard times ahead -- if you think the country is in trouble "under the virus", you ain't seen nuthin' yet.

Once again, please review my American Timeline.
How far along are we?

2019: USA -- United States of America
2027: USSA -- United Socialist States of America
2035: USSSA -- United Soviet Socialist States of America
2042:  ?????

[Absalom]

A reflection.
Cultures/societies receive the governance they accept, derived from the values they embrace.
Leadership, is defined as an influence process and trait, by which one enlists the support of
others to accomplish a common goal.
It requires a broad rather than narrow perception of human need; derived from a spiritual sensibility.
Yet what is the focus of all the Sturm und Drang that currently engulfs us?
Why 'Material Betterment' of course, which has defined us as a nation/state since
the post-Civil War Industrial Revolution; but is that sufficient in our current malaise???
Certainly not and the absurd embarrassments we label leaders is mute testament to that cold reality!
If and when we re-discover the vision/values of our Founders, we will recover; otherwise we will
fade into another of the footnotes of history!!!
 



 

[libertybele]

Victor wrote:
"Trump will be toast, I am sorry to say.  He is going to get blamed, unfairly, but that is the nature of politics.  Presidents take the credit when times are good, they suffer the consequences when things go south."

Then that means Joe Biden as president for a very short while, to be quickly followed by his resignation (or removal) and the ascendance of whomever is chosen for him to run as the VP candidate.

It will almost certainly mean a democrat-communist Senate and House, as well.

That means hard times ahead -- if you think the country is in trouble "under the virus", you ain't seen nuthin' yet.

Once again, please review my American Timeline.
How far along are we?

2019: USA -- United States of America
2027: USSA -- United Socialist States of America
2035: USSSA -- United Soviet Socialist States of America
2042:  ?????

Given what's happened and the direction that this country has taken because of the virus I'd say you're dates are a tad conservative -- 2024: United Socialist States of America

Yes, you can bet that the DNC and the DEM party are selecting the VP to take Joe's place after his very brief time in office - couple of months, tops.

[Right_in_Virginia]

A reflection.
Cultures/societies receive the governance they accept, derived from the values they embrace.
Leadership, is defined as an influence process and trait, by which one enlists the support of
others to accomplish a common goal.
It requires a broad rather than narrow perception of human need; derived from a spiritual sensibility.
Yet what is the focus of all the Sturm und Drang that currently engulfs us?
Why 'Material Betterment' of course, which has defined us as a nation/state since
the post-Civil War Industrial Revolution; but is that sufficient in our current malaise???
Certainly not and the absurd embarrassments we label leaders is mute testament to that cold reality!
If and when we re-discover the vision/values of our Founders, we will recover; otherwise we will
fade into another of the footnotes of history!!!

Judges, need a ruling, please.  Would "Oh, for cripes sake, STFU" be an acceptable answer??

[libertybele]

I'm seeing a lot of MEDIA driven disillusionment with Trump over the Chicom Virus. The doctors will prevail, we'll get past the disease, and eventually there will likely be a vaccine. There are a number of treatments being tested, some poorly tested, because essential elements are left out of the pharmacology, but tested nonetheless.  Where the full pharmacology is used (Hydroxychloroquine, Azithromycin, AND Zinc Sulfate), the results have been reported as very good.
The challenge will be to rebuild a severely damaged economy.

So, I have to ask, which politician (most have never had a real job) do you think could do a better job of shepherding the rebuilding of the American economy?

IF anyone is capable at successfully rebuilding this economy it's Trump.  I have absolutely no doubt and never really had any question or doubt that he would be good on the economy. The question is will he be able to survive the manipulation and corruption from the left?

Secondly, I honestly worry about his health. He is not a young man by any means and the enormous stress that he is under combined with the stress from the opposition is taking its toll.  I watch him as he walks away from the podium after the briefings; head hung a little bit lower and his posture is slumped; not what I'm accustomed to seeing.

[Absalom]

Judges, need a ruling, please.  Would "Oh, for cripes sake, STFU" be an acceptable answer??

---------------------
A query for the moderator.
Given the quality and wisdom of these remarks, don't
they belong in your Post Correction Sandbox???

[Smokin Joe]

A reflection.
Cultures/societies receive the governance they accept, derived from the values they embrace.
Leadership, is defined as an influence process and trait, by which one enlists the support of
others to accomplish a common goal.
It requires a broad rather than narrow perception of human need; derived from a spiritual sensibility.
Yet what is the focus of all the Sturm und Drang that currently engulfs us?
Why 'Material Betterment' of course, which has defined us as a nation/state since the post-Civil War Industrial Revolution; but is that sufficient in our current malaise???
Certainly not and the absurd embarrassments we label leaders is mute testament to that cold reality!
If and when we re-discover the vision/values of our Founders, we will recover; otherwise we will
fade into another of the footnotes of history!!!

That is all well and good when the entire population is choosing between "material betterment" and whether or not they get sick (in their perceptions).

When the spectre of complete impoverishment rears its head, people become more willing to suffer tyranny for a crust of bread.

Values become fluid in most when the question of survival arises.

From the Founders' expectations of that government which governs best governs least, to the present nanny State, we have indeed lost much.
Now, those who merely want to be left alone suffer the intrusions of government into the most minute aspects of their daily lives, at the behest of the remainder of the population.

There are those here who would advocate using the tax dollars of the many to bribe the few from the Federal Level, to use the States to impose Federal policies that only the States may Constitutionally impose, or which will be harder to fight on 50+ different courts.

I can't say I am for that, only the condition that we all comply with the Constitutional Federal Laws (like Immigration Law) before funds are distributed. 

Sadly, the vast majority of what the Federal Government does is beyond Constitutional Intent, and until the people desire to return to that intent, it will stay that way, as reflected in the programs they support and the people they elect. Social trends are not toward self sufficiency, but away from that, on balance.

[Absalom]

That is all well and good when the entire population is choosing between "material betterment" and whether or not they get sick (in their perceptions).
When the spectre of complete impoverishment rears its head, people become more willing to suffer tyranny for a crust of bread.
Values become fluid in most when the question of survival arises.
From the Founders' expectations of that government which governs best governs least, to the present nanny State, we have indeed lost much.
Now, those who merely want to be left alone suffer the intrusions of government into the most minute aspects of their daily lives, at the behest of the remainder of the population.
There are those here who would advocate using the tax dollars of the many to bribe the few from the Federal Level, to use the States to impose Federal policies that only the States may Constitutionally impose, or which will be harder to fight on 50+ different courts.
I can't say I am for that, only the condition that we all comply with the Constitutional Federal Laws (like Immigration Law) before funds are distributed. 
Sadly, the vast majority of what the Federal Government does is beyond Constitutional Intent, and until the people desire to return to that intent, it will stay that way, as reflected in the programs they support and the people they elect. Social trends are not toward self sufficiency, but away from that, on balance.

---------------------------
Smokin,
hardly interested in picking a fight, simply calling attention
to what I consider a fundamental and obvious matter.

[Smokin Joe]

---------------------------
Smokin,
hardly interested in picking a fight, simply calling attention
to what I consider a fundamental and obvious matter.

Not picking a fight, just at the bottom of it all, when bellies grumble and children are hungry, all bets are off.

[libertybele]

Not picking a fight, just at the bottom of it all, when bellies grumble and children are hungry, all bets are off.

This is already happening. Lots of people around here are hungry and have hungry children.  They just opened up another 3 schools to distribute bag lunches -- they are also now running a few buses so people have a way to get their one meal a day for their kids. The program started on March 23, and over 480,000 meals have been served.  People are very hungry.  Out of work.  Many businesses are shut down, no jobs available.  Two of the largest employers; the school system and the airport have been shut down for the most part -- an entire concourse shut down as there isn't a whole lot of traveling going on.  Rental cars aren't moving and surrounding hotels are pretty much empty.

[Smokin Joe]

This is already happening. Lots of people around here are hungry and have hungry children.  They just opened up another 3 schools to distribute bag lunches -- they are also now running a few buses so people have a way to get their one meal a day for their kids. The program started on March 23, and over 480,000 meals have been served.  People are very hungry.  Out of work.  Many businesses are shut down, no jobs available.  Two of the largest employers; the school system and the airport have been shut down for the most part -- an entire concourse shut down as there isn't a whole lot of traveling going on.  Rental cars aren't moving and surrounding hotels are pretty much empty.

Same here, made worse by the oil crash.
I have heard a lot of families are getting food through various food banks. We're fine, and I have a new job, so we aren't. Let it go to those who really need it.
All the wives and girlfriends and others who worked service sector jobs and relied on tips to fill the gas tank, buy their daily bread, eggs, and milk, lost that right away. The hospitality industry here is dead, and of the the slew of motels three are slated to or have already closed their doors.There are newer, nicer, ones which came in with the boom, and even most of those are poorly sited because a new airport was built afterwards, miles away.

Currently, apartments are offering the first month free, little deposit for qualified renters (under $100) and all utilities except internet for under $1000 for a two bedroom two bath apartment, 6month lease with a layoff breaker option (no penalty if you can show you lost your job, just vacate). (Cheap, when a year ago, to get in would have cost first month's rent security, (another month's rent) and no leases less than a year offered with no escape clauses.)

And then there is that brand new airport sitting there gathering dust (for now).

No wonder my assessment has gone up by 40%, they are aiming to tax that out of us all. (Good thing we voted down the school bonds.)

[libertybele]

Yes, I fear dramatically rising taxes and massive inflation.