Four Months, One Million Infections, 349 Billion Dollars And ‘Everybody Working Together’

Four months.

That’s how long it took for COVID-19 to infect more than 1 million people and claim some 53,000 lives globally.

Although each passing day brings a new milestone in a public health crisis that will forever change the course of history in ways we can only begin to fathom, the 1 million mark for total cases makes for a particularly poignant headline.

The US now accounts for around a quarter of total confirmed infections. New York alone will almost surely pass Spain and Italy for total cases, meaning the state by itself will have more COVID-19 cases than any country in the world other than the US.

“We’re advising New Yorkers to wear a face covering when you go outside and near other people”, New York City Mayor Bill de Blasio said at a press conference Thursday. “It can be a scarf, it can be something you create at home it can be a bandana”.

Andrew Cuomo said the state had 8,700 new infections, 1,200 new hospitalizations, 400 new ICU admissions and more than 400 new deaths.

Deborah Birx told reporters on Thursday that Michigan, Connecticut, Indiana, Georgia and Illinois are the likely next hot spots in the US. Around 15% of coronavirus tests administered in the states are positive. New York and New Jersey have positive test rates of 35%, she said.

On Thursday, Tennessee Governor Bill Lee altered the state’s “safe at home” guidance to make it all but mandatory. “I have updated my previous executive order to clearly require that Tennesseans stay at home unless they are carrying out essential activities”, he said.

Donald Trump was tested a second time. Again, he was negative.

The president ramped up pressure under the Defense Production Act Thursday, instructing the Department of Health and Human Services to make sure GE, Hill-Rom, Medtronic, ResMed, Royal Philips NV and Vyaire Medical get the supplies they need. “Today’s order will save lives by removing obstacles in the supply chain that threaten the rapid production of ventilators”, the president declared, in a statement.

For his part, Steve Mnuchin is struggling to ensure a program to disburse nearly $350 billion in congressionally-approved rescue loans to small businesses is up and running on schedule. It’s due to launch on Friday, but some banks balked at participating due to concerns that rushing the loans out the door would lead to problems for lenders later. Specifically, the banks were still responsible for avoiding fraud and adhering to standard procedures around preventing money laundering and terror financing, but those checks typically take weeks. The administration is pushing to have the loans disbursed within days.

Throw in the fact that Treasury was initially guiding rates at just 0.5% (which would make the loans an unprofitable line of business for some community banks), and Mnuchin was facing a stalemate. He insisted these problems had been mostly addressed during remarks at Thursday’s virus briefing.

New guidelines take the onus off the banks for conducting due diligence and permit lenders to rely on borrowers’ certifications, for which they (banks) will not be liable in cases of borrower malfeasance. Treasury and the Small Business Administration also agreed to double the rate on the loans to 1% from 0.5% in order to ensure small banks whose deposit costs are higher aren’t losing money on the deals.

Mnuchin had a simple message: “You get the money, you’ll get it the same day, you use this to pay your workers. Bring your workers back to work if you’ve let them go”.

“Having just received guidance outlining how to implement a $349 billion program literally hours before it starts, we would ask for everyone to be patient”, the Consumer Bankers Association said. “Patient” is something Mnuchin will not be in this situation, so hopefully, these loans are approved quickly. As Bloomberg notes, the loans “are guaranteed by the federal government, don’t require collateral [and] will be forgiven if funds are used for payroll costs, mortgage interest, rent and utility payments for two months and if businesses retain and rehire employees”.

Between these extremely loose guidelines and everything the Fed is doing when it comes to accepting anything that can be even loosely described as “investment grade” as collateral for cheap funding, the chances of something going awry in all of this are about the same as the chances of contracting coronavirus in New York City if you went door to door and asked people to cough directly into your mouth – i.e., the odds of problems arising down the road are relatively high.

But we’ll clean that mess up later, I suppose. For now, the priority is saving lives and ensuring millions of Americans don’t descend into poverty virtually overnight.

Meanwhile, The Trump Organization has reportedly been on the phone with Deutsche Bank recently about delaying payments on its loans given that some of the golf courses and hotels owned by the president’s family business are closed due to coronavirus lockdown protocol.

“Representatives of Mr. Trump’s company have recently spoken with Deutsche Bank, the president’s largest creditor [and] in Florida, the Trump Organization sought guidance last week from Palm Beach County about whether it expected the company to continue making monthly payments on county land that it leases for a 27-hole golf club”, The New York Times reported on Thursday afternoon.

“These days everybody is working together”, Eric Trump remarked. “Tenants are working with landlords, landlords are working with banks. The whole world is working together as we fight through this pandemic”.