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Category: Economics/Business

The economy is in free fall but Wall Street is thriving

The economy is in free fall but Wall Street is thriving

By Jesse Eisinger, ProPublica, May 10, 2020 Ten weeks into the worst crisis in 90 years, the government’s effort to save the economy has been both a spectacular success and a catastrophic failure. The clearest illustration of that came on Friday, when the government reported that 20.5 million people lost their jobs in April. It marked a period of unfathomable pain across the country not seen since the Great Depression. Also on Friday, the stock market rallied. The S&P 500…

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Why U.S. jobless figures don’t capture the true state of the coronavirus economy

Why U.S. jobless figures don’t capture the true state of the coronavirus economy

MarketWatch reports: ‘The virus is still spreading throughout much of the country. We have to continue to be very measured and not reopen too quickly because we may pay the price for that.’ That’s the cautious view Minneapolis Federal Reserve Bank President Neel Kashkari shared on NBC’s Today Show in an interview ahead of Friday’s monthly employment report, which he says won’t give the clearest picture of job losses amid the coronavirus pandemic. “That bad report tomorrow is actually going…

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The only way to get back to normal this summer is to test everyone in the U.S., says leading economist

The only way to get back to normal this summer is to test everyone in the U.S., says leading economist

The Washington Post reports: Nobel Prize-winning economist Paul Romer says a return to nearly normal life is possible this summer if the United States does wide-scale testing for the coronavirus. Romer is calling on the U.S. government to test everyone in the nation once every two weeks and isolate people who test positive for the deadly coronavirus. He estimates that doing so would cost $100 billion, a hefty sum but far less than the $2 trillion Congress has spent so…

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Economists agree that no quick rebound from recession is likely

Economists agree that no quick rebound from recession is likely

The Associated Press reports: Devastated by the coronavirus, the U.S. economy is sinking. And the plunge is accelerating. Now, as some businesses in a few states start to trickle back to work, hopes are beginning to arise that the economy, damaged as it is, might be poised to rebound by the second half of the year. If more employees and consumers were to gradually return to working and spending, the idea goes, the economy might be able to mount a…

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Energy: A silver lining in the pandemic

Energy: A silver lining in the pandemic

Michael T. Klare writes: Energy analysts have long assumed that, given time, growing international concern over climate change would result in a vast restructuring of the global energy enterprise. The result: a greener, less climate-degrading system. In this future, fossil fuels would be overtaken by renewables, while oil, gas, and coal would be relegated to an increasingly marginal role in the global energy equation. In its World Energy Outlook 2019, for example, the International Energy Agency (IEA) predicted that, by…

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Private gain mustn’t be allowed to elbow out the public good

Private gain mustn’t be allowed to elbow out the public good

By Dirk Philipsen Adam Smith had an elegant idea when addressing the notorious difficulty that humans face in trying to be smart, efficient and moral. In The Wealth of Nations (1776), he maintained that the baker bakes bread not out of benevolence, but out of self-interest. No doubt, public benefits can result when people pursue what comes easiest: self-interest. And yet: the logic of private interest – the notion that we should just ‘let the market handle it’ – has…

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Leading economist: U.S. coronavirus response is like ‘third world’ country

Leading economist: U.S. coronavirus response is like ‘third world’ country

The Guardian reports: Donald Trump’s botched handling of the Covid-19 crisis has left the US looking like a “third world” country and on course for a second Great Depression, one of the world’s leading economists has warned. In a withering attack on the president, Joseph Stiglitz said millions of people were turning to food banks, turning up for work due to a lack of sick pay and dying because of health inequalities. The Nobel prize-winning economist said: “The numbers turning…

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The facts about Trump’s chances of getting reelected

The facts about Trump’s chances of getting reelected

Daniel W. Drezner writes: Over the weekend, the hard-working staff here at Spoiler Alerts read a lot of analysis about what the Trump administration was thinking and doing about reelection. What all of this analysis had in common was a refusal to acknowledge some brute facts. My personal favorite is this headline on an Associated Press story: “Coronavirus could complicate Trump’s path to reelection.” I know the AP is as strait-laced as possible in its coverage, and to be fair,…

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Emmanuel Macron: The pandemic ‘will change the nature of globalization’

Emmanuel Macron: The pandemic ‘will change the nature of globalization’

The Financial Times reports: Unlike other world leaders, from Donald Trump in the US to Xi Jinping in China, who are trying to return their countries to where they were before the pandemic, the 42-year-old [French president] Mr Macron says he sees the crisis as an existential event for humanity that will change the nature of globalisation and the structure of international capitalism. As a liberal European leader in a world of strident nationalists, Mr Macron says he hopes the…

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East and West coast governors preempt move by Trump and form pacts to control reopening of economies

East and West coast governors preempt move by Trump and form pacts to control reopening of economies

CNN reports: States on the country’s East and West coasts are forming their own regional pacts to work together on how to reopen from the stay-at-home orders each has issued to limit the spread of the novel coronavirus. The first such group to be announced came Monday on the East Coast. Democratic New York Gov. Andrew Cuomo said his state, New Jersey, Connecticut, Pennsylvania, Delaware, Rhode Island and Massachusetts each plan to name a public health and economic official to…

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Five-step plan for reopening business is put to the test in China

Five-step plan for reopening business is put to the test in China

The Washington Post reports: Employers and employees around the world are anxious to get back to work as soon as possible. A picture of how that will unfold is starting to emerge — and it’s far from straightforward. Businesses have long relied on a five-tier inverted pyramid called the “hierarchy of controls” to reduce workplace risks to employees, ranging from chemical exposure to physical injury. This framework will also be the basis for companies’ plans to get back to work,…

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America’s billionaires’ gifts to charity are mostly PR stunts

America’s billionaires’ gifts to charity are mostly PR stunts

Robert Reich writes: As millions of jobless Americans line up for food or risk their lives delivering essential services, the nation’s billionaires are making conspicuous donations – $100m from Amazon’s Jeff Bezos for food banks, billions from Microsoft co-founder Bill Gates for a coronavirus vaccine, thousands of ventilators and N95 masks from Elon Musk, $25m from the Walton family and its Walmart foundation. The list goes on. On Wednesday, Forbes released its annual billionaires list, happily noting that “the planet’s…

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Mountains of food wasted as coronavirus scrambles supply chain

Mountains of food wasted as coronavirus scrambles supply chain

The Guardian reports: Billions of dollars worth of food is going to waste as growers and producers from California to Florida are facing a massive surplus of highly perishable items. As US food banks handle record demand and grocery stores struggle to keep shelves stocked, farmers are dumping fresh milk and plowing vegetables back into the dirt as the shutdown of the food service industry has scrambled the supply chain. Roughly half the food grown in the US was previously…

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How coronavirus felled the global economy in 100 days

How coronavirus felled the global economy in 100 days

Larry Elliott writes: It is New Year’s Eve 2019 and around the world stock markets are closing for business on a high note. Shares in the US are up by almost 30% on the year, those in Japan by 18%. Even in Britain, where the mood has been dampened by months of Brexit uncertainty, the FTSE 100 has risen by 12%. Overall, it had been the best year for stocks since 2009 and traders saw no real reason why the…

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What will the world be like after coronavirus? Four possible futures

What will the world be like after coronavirus? Four possible futures

By Simon Mair, University of Surrey Where will we be in six months, a year, ten years from now? I lie awake at night wondering what the future holds for my loved ones. My vulnerable friends and relatives. I wonder what will happen to my job, even though I’m luckier than many: I get good sick pay and can work remotely. I am writing this from the UK, where I still have self-employed friends who are staring down the barrel…

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COVID-19 will slow the global shift to renewable energy, but can’t stop it

COVID-19 will slow the global shift to renewable energy, but can’t stop it

Shutdown in Seattle to slow the spread of coronavirus empties the streets, March 26, 2020. Less economic activity means less revenue for utilities. AP Photo/Ted S. Warren By Peter Fox-Penner, Boston University The renewable energy industry, which until recently was projected to enjoy rapid growth, has run into stiff headwinds as a result of three era-defining events: the COVID-19 pandemic, the resulting global financial contraction and a collapse in oil prices. These are interrelated, mutually reinforcing events. It’s much too…

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