Tickets And Rents

Tickets And Rents

Assuming Americans exercise a modicum of common sense, COVID-19 cases are projected to see a “sharp decline” by July, the CDC said Wednesday, in an updated scenario analysis that was good for a few headlines.

The forecast was based on “data from six models” which indicated that “with high vaccination coverage and moderate nonpharmaceutical intervention adherence, hospitalizations and deaths will likely remain low nationally” and new infections will plunge within a few months.

Naturally, the study was replete with caveats, some of which referenced new virus variants, while others could be roughly summarized as exhortations to the public, which is advised to use good judgment and let the science do the talking. (No bleach injections, please.)

CDC

In comments delivered during a virtual White House press briefing, Rochelle Walensky called the virus variants a “wild card.” “The models projected a sharp decline in cases by July and even faster decline if more people get vaccinated sooner,” she remarked, before warning that “local conditions and emerging variants are putting many states at risk for increases in cases, especially if we don’t increase the rate of vaccinations and if we don’t keep our current mitigation strategies in place until we have a critical mass of people vaccinated.”

Speaking of increasing vaccinations, New York is going to try handing out free Yankees tickets as an incentive. You can even get your shot at the game.

“If you love baseball (and protecting your community) go to a game, get vaccinated and get a free ticket!” Andrew Cuomo exclaimed. He also said that starting May 19, Yankee Stadium and Citi Field will offer full capacity seating for fully vaccinated people. If you’re not vaccinated, capacity will be 33%. Masks are required for everyone. Broadway shows should begin in September at 100% capacity, Cuomo said. Tickets go on sale Thursday.

In other vaccine news, Pfizer and Moderna sank (figure below) as the Biden administration appeared poised to back a waiver of patent protections on the vaccines. In a sad testament to day-trader obliviousness, a quick scan of social media and other social trading platforms suggested most regular folks had absolutely no idea this was even a discussion.

“This is a global health crisis, and the extraordinary circumstances of the COVID-19 pandemic call for extraordinary measures,” Katherine Tai said. “The Administration believes strongly in intellectual property protections, but in service of ending this pandemic, supports the waiver of those protections for COVID-19 vaccines.”

“The issue is coming to a head as the World Trade Organization’s General Council, one of its highest decision-making bodies, meets Wednesday and Thursday,” The New York Times wrote, summing up the debate and adding that,

India and South Africa are pressing for the body to waive an international intellectual property agreement that protects pharmaceutical trade secrets. The United States, Britain and the European Union [had] blocked the plan. Inside the White House, health advisers to the president admit they are divided. Some say that Biden has a moral imperative to act, and that it is bad politics for the president to side with pharmaceutical executives. Others say spilling closely guarded but highly complex trade secrets into the open would do nothing to expand the global supply of vaccines.

It’s a shame when humanitarian concerns get in the way of good old fashioned profits, ain’t it?

Meanwhile, a federal judge decided it would be a good idea to strike down the CDC’s national eviction moratorium, a decision which, if upheld, has the potential to create a housing crisis that could worsen the pandemic. “The question for the court is a narrow one: Does the Public Health Service Act grant the CDC the legal authority to impose a nationwide eviction moratorium?,” Trump appointee and former Orrin Hatch staffer, Dabney Friedrich, wrote. “It does not.”

The Justice Department will appeal. Experts suggested the effect would be limited in the near-term. “Several court rulings have attempted to strike down the moratorium, but all had limited application,” Diane Yentel, president and CEO of the National Low Income Housing Coalition told NBC. “While this ruling is written more starkly than previous ones, it likely has equally limited application, impacting only the plaintiffs who brought the case.”

As Bloomberg pointed out Wednesday, rents are now rising in some locales. “The median monthly charge on a vacant rental jumped by $185 in March from a year earlier,” a Wednesday article read, citing the Census Bureau (figure, below, from the original).

Census Bureau

This goes without saying, but that effectively means that getting evicted now is an even more perilous proposition than it would be at any other time. MBA data shows nearly a quarter of renters missed one payment or more over the course of the crisis.

I suppose there’s always the tent cities. I hear they’re “pretty substantial” these days.

Who knows, you might even get a visit from the Fed Chair. Well, not the real one. She’s busy. But the guy who plays Fed Chair on “60 Minutes” said he might stop by at some point. You know, “when it’s no longer a news story.”


5 thoughts on “Tickets And Rents

  1. Look no further than the disparate treatment of property owners versus renters (more than 1/3 of citizens) to see this economic system for what it is in all its ugliness and unfairness. This is a single chain of cash flows (flow of causality), but treatment by government is widely different depending on where one sits in the chain. It makes no logical, let alone ethical, sense.

    Property owners get forbearance, access to FED-backed MBS refinancing markets, and the general wealth effect that is a primary focus of interest rate policy. Lenders get the implicit and explicit government guarantee. Yet these socialistic windfalls are not shared to cashflows upstream. The only thing I’ve seen are the various eviction moratoria, yet to benefit from this renters are forced to, effectively, destroy their creditworthiness and ultimately be forcible removed from their homes and communities.

    When the buildings start burning, most people are going to wonder incredulously how it all started.

    1. Just a reminder that a landlord’s mortgage interest is not the only cost that rent covers. Landlords also pay real estate taxes and maintenance. Landlords are not being offered any moratoria on the costs of new refrigerators, HVAC systems, window leak repairs, plumbers, painters, roofing, etc.

      How long is a landlord expected to carry someone who isn’t paying? A month? A year? 5 years?

      Rent is not all profit, nor some penalty you have to pay.
      Even if you own your house or condo, you pay real estate taxes and maintenance (“rent” by other names).

      I see protest signs that say “Cancel Rent!” Well, you gotta eat too so why not “Free Groceries!”
      The answer is obvious
      The “stimulus” checks now going out are meant to socialize some of this and ease the burden.

  2. Eviction moratoirums (moratoria?) ending, employment improving, inflation hedges in demand? Favorable for housing REITs? Crass, I know, but its a reasonable investment question.

    I know, there’s doubt about whether REITs are an inflation hedge. Real property is, but REITs are stocks and capital-consumers. But if housing is a commodity . . . .

  3. “In comments delivered during a virtual White House press briefing, Rochelle Walensky called the virus variants a “wild card.””

    How “wild” could that card be? Glad you asked. In the later part of the 2018-19 flu pandemic, a variant emerged which was so much more lethal it killed within 48 hours of noticing symptoms. Fortunately, that resulted in fewer transmissions.

    Yes, we have a vaccine which is effective to known variants. I’m not sanguine about variants, they are wild as cards can be.

    1. In Today’s Covid News:

      This morning CNN noted that only 40% of GOP reps will admit to having been vaccinated.
      Meanwhile, in the places we don’t care about, the Nikkei reports that:

      1:54 p.m. Postponement of the travel bubble between Hong Kong and Singapore is “highly likely,” says Hong Kong commerce minister Edward Yau, citing the COVID-19 situation in Singapore, where cases have surged in recent weeks.

      1:10 p.m. Taiwan Premier Su Tseng-chang says there is no need to raise the island’s COVID-19 alert level, as it has more experience in fighting the pandemic compared with last year. While Taiwan has reported just 1,233 cases — mostly imported from abroad — a recent uptick in domestic infections has spooked the population and stock market.

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