Economic Impact of COVID19

PCHawk said:
There isn't enough financial assistance available to help everyone. I don't see a way any small business survives. If we quarantine for more than a couple months, I bet 75% of small businesses never open their doors again.
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Actually there is. Monetize debt more than we do. The cost is in inflation and the rise of stocks, eventual rise in commodities after a crash, 401ks, home values at the expense of savings and defined pensions. Someday it's maybe not going to work and we get in a deflation trap. Then boom greatest depression... Maybe. When ever we reset the average people get a bit less of the pie. The alternative would be soup kitchens and homelessness. In modern terms we are somewhat like 1962: after the long bull run. The Fed pumped life support and it basically worked.

We did it after we left the gold standard and to reinflate following the 73-74 crisis.

In the 80s some of the reset was in military buildup spending and flooding the economy with cash leading to those awful interest rates which destroyed Farmers as commodities crashed. The 90s the S and L bailout. The internet saved us and increased economic efficiencies big time.

The eventual balancing of that led to the 00s crisis. We never really weaned off economic life support. It's like antibiotic or round up resistance. That's why the we first time ever have zero interest rates. Having money in the bank will cost more than losing to inflation. The Fed wants you spending or buying stocks. In 01 they pulled out the shotgun. In 08 they brought out a bazooka. They this time are/will using nukes.

It will save averages Joe's hopefully...maybe but the cost will make him a little poorer. That's the expectation. We ll see.
 
uihawk82 said:
Well I hope the numbers are a lot less and since now the US and Britain are shuttering people and cancelling activities there is the very good chance the hospitals and medical care resources will not be overrun.

As far as taxes go you can tax people later to pay for economic and monetary assistance now. You do remember we can print more money but that will push up inflation a bit. US Govt borrows or prints more money, gives it out to stimulate the economy, then later raise more taxes if you want to pay back for the economic stimulus.

Of course our country seems to love to add to our debt.

Notice how I am being very careful not to be political and just saying things in general like ' wow we like to run up national debt'.
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The Fed is A political. It's a private bank. The chair is appointed but crosses presidential terms. Much less political than supreme Court.

Deficit spending is political.

Fractional reserve lending is how we really get economic growth. It is like a Ponzi though and needs bailed now and again.
 
Our school district is off this week. Next week is considered a week to work and get lessons ready for distance learning. Starting up with onling lessons (7-12) and worksheet/packet pickup points for elementary after that.

All school buildings will be deactivating badges access Friday at 3pm. Nobody will be able to get into school to plan/prep after that. We were just told we had to sign up for a 30 minute window of time (3 in the building at a time) either tomorrow or Friday to go grab any resources we need for distance learning.

Crazy times. IF we are allowed back on April 13th, there will be no track meets/tennis/golf/soccer events that week to allow kids to have a week of practice before jumping into contests. That will leave 4-6 weeks depending on the sport.

These are interesting times. Be safe. Any of you whose job/income just tanked, I hope the government can provide necessary help and best of luck.
 
Young people and CV19. The collateral damage. From the Federal Reserve. How will this be handled?
student-loans1-20_0.png
 
Economic Report
U.S. jobless claims surge 70,000 to 281,000 in mid-March as coronavirus triggers layoffs
 
My "full time job" is as a county employee. At the moment, we're 're still working regular hours, but have closed our doors to the public. My "other full time job" (in the spring) is coaching both varsity and club soccer. Both seasons were suspended the week before they were supposed to start. Varsity soccer is obviously dependent on the school lockdown and club soccer has been shut down by (both Iowa Soccer and US Soccer) through April 15th, but will obviously be reexamined as that time approaches.

Needless to say at this point I see a snowballs chance in hell that I'll be coaching any time soon.
 
I already work from home and the company I work for is one of the few that are benefiting from the hysteria.

My kids are too young for school and already stay home everyday. Not much has changed in my life.
 
Burger King is offering free kids meals starting March 23rd - April 6th. Good news if you are struggling with money. right now.

"Burger King will offer free kids meals, starting on Monday, March 23. This is an effort to help families affected by the coronavirus pandemic.The company says the meals will be available nationwide with any purchase through the Burger King app. The free meals can be redeemed one time daily per guest, through April 6. The free meals will be available at participating locations on takeout and drive-thru orders. The fast food chain is also planning to offer free delivery on app orders of more than $10."
 
Goldman Sachs predicting whopping GDP loss of 24 percent 2d quarter with a strong comeback 3 and 4 qtrs.
 
The Fed has now has already pumped more money into the economy tha in the Great Recession largely due to insurmountable margin calls to keep hedge funds going (for you that means mutual fund 401ks). The Fed as an entity is non-political. It is a private/public bank.

The impact of what is going on is going to have far-reaching consequences. My post is not trying to imply a diabolical plot but simply discuss the economic ramifications. There will always be those who think conspiracy and those who think it is random, and those who only think...save my 401k.

About Iowa sports, the fandom of the Hawks is not a necessity. Younger generations which never recovered from the Great Recession are going to continue to struggle which likely means less entertainment money.

I mentioned the transfer of wealth from the Great Recession which most of us didn't notice. It hit the lower 50% much harder. The lower excludes houses (per Federal Reserve)

upload_2020-3-21_9-14-40.png

Below is the more recent data on recovery also from the Fed
Fig1_20180914.png
 
So, how might the current situation impact college sports....Iowa Sports. First chart shows wealth following the Great Recession.

The 2nd shows the distribution of wealth by age. The 2nd shows the distribution of wealth by age. Since younger are less wealthy it is reasonable to assume younger people are poorer than previous generations (somewhat masked by the increase in working mothers)

My premise is that as younger people have failed to gain traction from the last recession that the current crisis will make it more difficult for younger people to be directly involved as Hawk fans/college sports fans. While the older generation will likely continue to be donors and fill up stadiums, their aging will decrease active participation. Some younger people will fill their "slots", but there will be fewer of them. The trend in lower attendance will continue.
FT_17.10.30_Wealth-Gap_great_recession.png

Median-Net-Worth-by-Quintiles-by-Age-of-Householder.png

FT_dual-income-households-1960-20121.png
 
Face it, we have a dumb electorate. Working class, middle class, and now some people who we would once thought would be making enough money struggle and have not been gaining but losing in real, inflation adjusted wages. But these people, the electorate, don't demand changes, they don't demand better wages, they elect people who wipe out unions and worker protections. I am not naming political names so don't say I am pointing fingers as there have been a lot of leaders and lawmakers who have mainly worked to cut themselves and big money people in for a bigger piece of the pie. And you cannot argue against this because the economic and financial data point to how much wealth has increased into the hands of the top 5% or even 2% in the last 40 years of supply side economics and tax breaks. But go ahead and keep re-electing the people who pass these tax and income laws.

The Founding Fathers said that democracy in the US would need to sit on top of an informed, wise electorate in order to succeed. Well it happening now and hasnt been since the 1980's. If all the Joes and Janes in this country want to sit by and let leaders and the courts say that Corporations have citizen rights then all the Joes and Janes deserve what they get which is not much. Teddy Roosevelt pushed and passed through laws that said businesses, no businesses, could donate to politicians (this according to historical and legal writings on corruption laws in America). But TR's laws were slowly dismantled since then and we have a messed up system.
 
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