On Sunday, Neel Kashkari offered a disconcerting take on what he says will be halting efforts to restart the world’s largest economy.
Speaking to CBS’s “Face the Nation”, Kashkari cast considerable doubt on the idea of a “V-shaped” recovery, citing evidence from across the globe, where the coronavirus has resurfaced once containment protocols are relaxed.
“These predictions that the economy is just going turn right back on when people go back to work [are] overly optimistic?”, Margaret Brennan asked, snapping her fingers for effect. “I think so”, Kashkari remarked, adding that it “would be wonderful if some new therapy were developed in the next couple of months… but barring some health care miracle, it seems like we’re going to have various phases of rolling flare ups”.
“Different parts of the economy turning back on, turning back off again”, he continued, cautioning that “this could be a long, hard road we have ahead of us”.
Earlier, Anthony Fauci told CNN it’s possible the US economy could partially reopen starting next month. His comments came less than two days after Donald Trump described the decision on when to lift lockdowns and allow businesses to reopen as the most consequential call he’s ever had to make.
Fauci emphasized that any restart will not be an “all or none” endeavor. “If all of a sudden we decide, ‘OK, it’s May, whatever, and we just turn the switch on, that could be a real problem”, Fauci warned. “I think it could probably start, at least in some ways, maybe next month”, he added, before quickly qualifying the statement. “Don’t hold me to it”.
We won’t, Dr. Fauci. But Donald Trump will.
Nearly 17 million Americans have filed for unemployment benefits over the past three weeks and the number will surely continue to rise.
The good news is, the “curve” continues to flatten in New York, where hospitalizations are falling. And yet, even as daily deaths have stabilized, the state is still losing well more than 700 people per day to the virus.
Projections for US economic output in the second quarter are dire, with most analysts and economists forecasting the sharpest contraction in the history of modern GDP statistics. Some see a sharp bounce in Q3 and Q4, but Kashkari is hardly alone in questioning those assumptions.
“We will get back to a better place [but] it’s just not going to bounce back in a V-shape to January of 2020”, Jeff Gundlach said, in a March 31 webcast. BofA changed its call recently to include a third consecutive quarterly contraction in Q3.
“We could have these waves of flareups, controls, flareups and controls until we actually get a therapy or a vaccine”, Kashkari went on to say Sunday.
If you ask the notoriously dovish Minneapolis Fed chief, “we should all be focusing on an 18-month strategy for our health care system and our economy”.
The capitalist are getting antsy and at this point in time, after decades of abuse, labor has them by the balls. Strike while the iron is hot.
I do agree about the abuse but not so much about the power shift. Some may consider “striking” while their antibodies are hot; if they could get proof. Hey there is a market some capitalist need to step into cheap private C19 antibody testing.
Cue dividend cuts, mass layoffs, and the rise of the machines?
Labor does not have them by the balls in any sense of the imagination. Who do you think makes up the food lines?
For better or worse, massive automation is on the horizon. Self-driving vehicles alone will displace millions of jobs. That won’t happen overnight, as some have predicted, but we will see it over the next decade or so. Even that slower change will be fast enough to be highly disruptive of labor. That’s just in the transportation sector. Change driven by automation is coming to manufacturing, food service, finance, etc. I am sympathetic to labor and middle class workers… my father was a very hard-working blue color employee… but I don’t see them with much power,
The current Republican government is merely nibbling on the margins, and not really attacking the problems that the middle class is facing in the future. As with the coronavirus, Trump sees the economic problems as coming from outside. In reality, the problem is already massively internally spreading. So, even if he deals with the external threat of globalization, the middle class will soon be ambushed by automation.
He wasn’t really entirely blue, just his collar.