5 ms·

Job losses could total 47M, unemployment 32%, St. Louis Fed president says

36 points by uptown 7y ago

ThrowawayR2 7y ago
For comparison, a quick Google shows the unemployment rate in the US during the Great Depression was around 25% and during the 2008 recession was around 10%. If this situation lasts too long, we'll all be saying hello to Great Depression v2.0.
- bdcravens 7y ago
  Wasn't the Great Depression as much a product of the time it took to overcome as the unemployment rate? We have a greater ability to deploy resources today, and geography is less of an issue for many industries, so perhaps that will be a mitigating factor. The Great Repression?
  - downrightmike 7y ago
    IT was because of the GD, that the government began to spend money to aid the economy in the first place. A new Works Project Administration could do a lot to rebuild infrastructure that we need anyway.
- generalpass 7y ago
  > For comparison, a quick Google shows the unemployment rate in the US during the Great Depression was around 25% and during the 2008 recession was around 10%. > If this situation lasts too long, we'll all be saying hello to Great Depression v2.0. The most troubling is that there is no analysis being performed to determine what a proportionate response is, and I tend to think most people do not understand how interconnected the economy actually is. At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics.
  - aplummer 7y ago
    > At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics. A reminder money is a paper money game and in contrast to the 30s, we easily produce more resources, food and abundance than we need to live with 30% unemployment.
    - SpicyLemonZest 7y ago
      But that's exactly why people are scared of the recovery. The phenomenon underpinning the economy isn't money flowing through accounts; it's networks of trade and service provision, and most of those networks are being snipped by the lockdown. We won't starve and we won't lose Netflix, but those networks can't be restored solely by financial stimulus and we can't recover our standard of living without them.
      - thepangolino 7y ago
        There's a simple solution to that. Just remove regulations. Remove lockdowns.
        Gibbon1 7y ago
        You really think the rabble will continue working as the infection rate rises into the double digits.
  - jdkee 7y ago
    "At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics." Care to elaborate?
    - generalpass 7y ago
      > "At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics." > Care to elaborate? The "current rate" assumes a large percentage of the economy being forced to shutdown by government order for an indefinite period. This rate is larger than everyone thinks because we are not just talking about restaurants, theaters and salons. There are all sorts of manufacturing, repair, and other businesses which are also shut down. (Note that Americans have very little savings.) The elderly largely rely on government welfare though Social Security, Medicare, and other programs to survive. With payrolls substantially contracted, this is going to cause a very serious burden on these systems. The likely result will be substantially reduced payments to care providers as well as significant delays in payment, which then likely causes some providers to stop accepting from these systems, thus overloading other providers who may follow and do the same. Everyone needing medical care is reliant on the healthcare system receiving so much money for its services, but given that U.S. healthcare is tied to employment, a lot more people won't be able to pay their bills, so the providers will then increase rates to those who can pay, and employers will be forced to further shed employees to cover premium hikes. Even in the short term, this will reduce new investment in healthcare, such new facilities, equipment, and even equipment maintenance and repair, so the facilities will perform more poorly. Number of beds available will fall because there will be fewer beds per person. There will also be increases in suicide from the increase in unemployment as well as the social isolation Drug overdoses rise. Property crime and violent crime nearly always increase during periods of economic decline. People will consume less healthy foods and be in poorer health. The government is now creating money and giving it directly to consumers. This will increase CPI and exacerbate pretty much everything.
treyfitty 7y ago
Bullard has always been extremely bearish, and is consistently a dissenter in FOMC meetings FYI. While his number is very high, I would take it with a grain of salt. It will be high, but not that high
jdkee 7y ago
"During a CNBC interview last week, Bullard said the jobless number “will be unparalleled, but don’t get discouraged. This is a special quarter, and once the virus goes away and if we play our cards right and keep everything intact, then everyone will go back to work and everything will be fine.” Nothing is going back to business-as-usual after this event. 1. Companies that successfully transition to work form home will shed tens of millions of commercial real estate square footage. 2. The online shopping/home delivery will accelerate the collapse of the retail shopping environment. The U.S. has too much already, see https://www.statista.com/statistics/1058852/retail-space-per-capita-selected-countries-worldwide/ https://www.statista.com/statistics/1058852/retail-space-per... 3. This will accelerate online learning, especially in higher-ed. We are already planning our summer courses to be fully taught online as of this point in time. 4. Tying healthcare to employment in the U.S. will likely become unthinkable as a public health hazard. EDIT: spelling
- PragmaticPulp 7y ago
  This pandemic has an amazing ability to make everyone more confident in their personal preferences and pre-conceived notions. Is it safe to assume that before this pandemic, you: 1. Preferred WFH to being in an office. You wished more jobs would accept remote employees like you. 2. Preferred online shopping wherever possible. When visiting retail stores, you wished a tech company would disrupt that industry so you wouldn't have to visit a store. 3. Prefer to learn on your own, at your own pace 4. Assumed that anyone who disagreed with your political leanings was just misinformed or morally bankrupt. What's fascinating is that my social media feeds are full of people who are convinced that this pandemic is proving their pre-conceived beliefs to be more correct than ever. It's making it more difficult for people to see differing viewpoints, or understand why someone could have differing personal preferences. The dust hasn't even settled yet, but my friends are either declaring WFH to be the way of the future or wholly untenable. I have numerous friends with children at home who are more eager than ever to return to their offices and go back to normal. My manager friends are all fretting the productivity drops as people struggle to get work done amid a 24/7 news cycle of impending doom. Yet the WFH champions are convinced this will prove WFH to be superior. Personally, I think the long-lasting changes from this pandemic are far harder to predict than people are suggesting.
kenshinsoul 7y ago
My argument is that the national security mechanisms of western nations are not so fragile to be brought to their knees by some people eating bats and snakes. In WW2 the Japanese threatened to destroy key infrastructure using biological agents. the militaries of the world have had almost a century at the very least to prepare for this contingency. I don’t buy how unprepared they are. I am curious to hear the thoughts of some smart people who hang out here.
blackrock 7y ago
No worries, the Fed just printed 4 Trillion dollars, that they’ll hand out to the rich companies. The stock market will go into super drive. It will double in another 10 years. So load up on stocks as soon as this crisis is over. And get a house and property if you can. The value of your dollar is going to get cut in half. The rich oligarchs wins again.

36 points by uptown 7y ago

For comparison, a quick Google shows the unemployment rate in the US during the Great Depression was around 25% and during the 2008 recession was around 10%. If this situation lasts too long, we'll all be saying hello to Great Depression v2.0.

bdcravens 7y ago
Wasn't the Great Depression as much a product of the time it took to overcome as the unemployment rate? We have a greater ability to deploy resources today, and geography is less of an issue for many industries, so perhaps that will be a mitigating factor. The Great Repression?
- downrightmike 7y ago
  IT was because of the GD, that the government began to spend money to aid the economy in the first place. A new Works Project Administration could do a lot to rebuild infrastructure that we need anyway.
generalpass 7y ago
> For comparison, a quick Google shows the unemployment rate in the US during the Great Depression was around 25% and during the 2008 recession was around 10%. > If this situation lasts too long, we'll all be saying hello to Great Depression v2.0. The most troubling is that there is no analysis being performed to determine what a proportionate response is, and I tend to think most people do not understand how interconnected the economy actually is. At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics.
- aplummer 7y ago
  > At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics. A reminder money is a paper money game and in contrast to the 30s, we easily produce more resources, food and abundance than we need to live with 30% unemployment.
  - SpicyLemonZest 7y ago
    But that's exactly why people are scared of the recovery. The phenomenon underpinning the economy isn't money flowing through accounts; it's networks of trade and service provision, and most of those networks are being snipped by the lockdown. We won't starve and we won't lose Netflix, but those networks can't be restored solely by financial stimulus and we can't recover our standard of living without them.
    - thepangolino 7y ago
      There's a simple solution to that. Just remove regulations. Remove lockdowns.
      - Gibbon1 7y ago
        You really think the rabble will continue working as the infection rate rises into the double digits.
- jdkee 7y ago
  "At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics." Care to elaborate?
  - generalpass 7y ago
    > "At this rate, the deaths from draconian government responses will far outweigh the deaths from the Corona virus across all age demographics." > Care to elaborate? The "current rate" assumes a large percentage of the economy being forced to shutdown by government order for an indefinite period. This rate is larger than everyone thinks because we are not just talking about restaurants, theaters and salons. There are all sorts of manufacturing, repair, and other businesses which are also shut down. (Note that Americans have very little savings.) The elderly largely rely on government welfare though Social Security, Medicare, and other programs to survive. With payrolls substantially contracted, this is going to cause a very serious burden on these systems. The likely result will be substantially reduced payments to care providers as well as significant delays in payment, which then likely causes some providers to stop accepting from these systems, thus overloading other providers who may follow and do the same. Everyone needing medical care is reliant on the healthcare system receiving so much money for its services, but given that U.S. healthcare is tied to employment, a lot more people won't be able to pay their bills, so the providers will then increase rates to those who can pay, and employers will be forced to further shed employees to cover premium hikes. Even in the short term, this will reduce new investment in healthcare, such new facilities, equipment, and even equipment maintenance and repair, so the facilities will perform more poorly. Number of beds available will fall because there will be fewer beds per person. There will also be increases in suicide from the increase in unemployment as well as the social isolation Drug overdoses rise. Property crime and violent crime nearly always increase during periods of economic decline. People will consume less healthy foods and be in poorer health. The government is now creating money and giving it directly to consumers. This will increase CPI and exacerbate pretty much everything.

treyfitty 7y ago

Bullard has always been extremely bearish, and is consistently a dissenter in FOMC meetings FYI. While his number is very high, I would take it with a grain of salt. It will be high, but not that high

jdkee 7y ago

"During a CNBC interview last week, Bullard said the jobless number “will be unparalleled, but don’t get discouraged. This is a special quarter, and once the virus goes away and if we play our cards right and keep everything intact, then everyone will go back to work and everything will be fine.” Nothing is going back to business-as-usual after this event. 1. Companies that successfully transition to work form home will shed tens of millions of commercial real estate square footage. 2. The online shopping/home delivery will accelerate the collapse of the retail shopping environment. The U.S. has too much already, see https://www.statista.com/statistics/1058852/retail-space-per-capita-selected-countries-worldwide/ https://www.statista.com/statistics/1058852/retail-space-per... 3. This will accelerate online learning, especially in higher-ed. We are already planning our summer courses to be fully taught online as of this point in time. 4. Tying healthcare to employment in the U.S. will likely become unthinkable as a public health hazard. EDIT: spelling

PragmaticPulp 7y ago
This pandemic has an amazing ability to make everyone more confident in their personal preferences and pre-conceived notions. Is it safe to assume that before this pandemic, you: 1. Preferred WFH to being in an office. You wished more jobs would accept remote employees like you. 2. Preferred online shopping wherever possible. When visiting retail stores, you wished a tech company would disrupt that industry so you wouldn't have to visit a store. 3. Prefer to learn on your own, at your own pace 4. Assumed that anyone who disagreed with your political leanings was just misinformed or morally bankrupt. What's fascinating is that my social media feeds are full of people who are convinced that this pandemic is proving their pre-conceived beliefs to be more correct than ever. It's making it more difficult for people to see differing viewpoints, or understand why someone could have differing personal preferences. The dust hasn't even settled yet, but my friends are either declaring WFH to be the way of the future or wholly untenable. I have numerous friends with children at home who are more eager than ever to return to their offices and go back to normal. My manager friends are all fretting the productivity drops as people struggle to get work done amid a 24/7 news cycle of impending doom. Yet the WFH champions are convinced this will prove WFH to be superior. Personally, I think the long-lasting changes from this pandemic are far harder to predict than people are suggesting.

kenshinsoul 7y ago

My argument is that the national security mechanisms of western nations are not so fragile to be brought to their knees by some people eating bats and snakes. In WW2 the Japanese threatened to destroy key infrastructure using biological agents. the militaries of the world have had almost a century at the very least to prepare for this contingency. I don’t buy how unprepared they are. I am curious to hear the thoughts of some smart people who hang out here.

blackrock 7y ago

No worries, the Fed just printed 4 Trillion dollars, that they’ll hand out to the rich companies. The stock market will go into super drive. It will double in another 10 years. So load up on stocks as soon as this crisis is over. And get a house and property if you can. The value of your dollar is going to get cut in half. The rich oligarchs wins again.