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3 signs the global economy is starting to emerge from COVID-19 hell
The U.S. labor market will probably be in a more positive place come election season this fall than the one being battered by the COVID-19 pandemic this spring. But most Wall Street pros Yahoo Finance has spoken with think that even if the U.S. economy is back to creating jobs later this year as businesses reopen, the unemployment rate will remain above 10%. Legions of people will have to be retrained to support the jobs of today, which is one factor in the unemployment rate likely staying elevated.
Since the U.S. economy shut down seven weeks ago, more than 33 million people have lost their jobs, including 3.169 million who filed for unemployment benefits in the week ending May 2. And nearly 7 in 10 Americans say their income has shrunk because of the coronavirus pandemic, according to a new Financial Times-Peterson Foundation U.S. Economic Monitor report. “The outlook for the labor market remains frightening,” Nick Bunker, Indeed.
As Congress eyes the next phase of coronavirus relief, some lawmakers want to help pay frontline workers’ student loans or higher education costs. “Grocery clerks didn't take that job at relatively modest wages thinking they were saving the world,” said Rep. Ann Kuster (D-NH) in an interview with Yahoo Finance.
The U.S. Treasury is borrowing $3 trillion in three months to pay for the pandemic response, a record sum that dwarfs the $1.8 trillion borrowed in 2009 during the financial crisis. The debt will be sold in bonds to a variety of foreign and domestic investors. At the 2020 Berkshire Hathaway Annual Shareholders Meeting on Saturday, which was closed to the public due to Covid-19 but livestreamed on Yahoo Finance, billionaire investor Warren Buffett carefully explained in simple terms why the U.S. will never default on its debt.
Relaxing business closures and stay-at-home rules could cost 13,000 lives in Texas and 12,000 lives in Georgia by September 1. But it will also preserve $3.4 billion in statewide income in Texas, and $1.7 billion in Georgia. New York’s tougher restrictions will save 5,000 lives, but cost $2.4 billion in lost income.
As 30 million Americans have lost their jobs over the last six weeks amid the coronavirus pandemic, America’s billionaires are becoming even richer. According to a new report from the Institute for Policy Studies, a left-leaning think tank, over the past 6 weeks, American billionaires have seen their wealth increase by $406 billion — a boost of just under 14% to their net worth. An initial decline The global pandemic has impacted everyone’s pockets, regardless of income.
Financial markets seemed relieved when Bernie Sanders dropped from the race and Joe Biden became the de facto Democratic presidential nominee. But markets will have to adjust if Biden actually beats President Trump in November and moves into the White House next year. There are two President Biden scenarios: one in which Republicans retain control of the Senate, and one in which Democrats pick up four seats or more, and squeak to a majority.
On the heels of worse-than-anticipated first-quarter GDP data, investors will be bracing for additional economic data Thursday to reflect the ongoing damage being done to the U.S. economy as a result of the COVID-19 pandemic. The U.S. Labor Department is scheduled to release weekly jobless claims figures Thursday morning, and economists predict that an additional 3.5 million Americans filed for unemployment benefits during the week ending April 25, following 4.
During the last two months, Congress has passed $3.6 trillion in stimulus spending, with more probably on the way. Washington’s annual deficit was likely to be around $1 trillion before the COVID-19 pandemic induced a recession. The deficit will now hit at least $3.7 trillion this year and $2.1 trillion next year, according to the Congressional Budget Office.
Economy is going to be very slow coming out of the recession:' Strategist
During the last recession, from 2007 to 2009, the unemployment rate in the United States rose by 5.6 percentage points, peaking at 10%. Germany endured the same recession, but unemployment only rose by 0.7 points, to 8.3%. And Germany recovered from the recession faster. Unemployment is spiking once again amid the coronavirus pandemic, with some economists predicting it could hit 15% or more in the United States.
Welcome to Tech Support, a segment where I, Dan Howley, serve as your intrepid guide through the sometimes confusing, often frustrating, world of personal technology. Here, I answer all of your most pressing questions about the various gizmos, gadgets, and devices you use in your everyday life. Have a question of your own? Reach me on Twitter at @danielhowley, or email me at dhowley@yahoofinance.com. Now, on to your questions.
Collapsing oil prices may be a warning sign of what’s yet to come for the economy, says one energy expert. “I think oil is telling the story that some of the worst effects of coronavirus on the economy may yet come,” Dan Dicker, founder of The Energy Word, tells Yahoo Finance. “That oil should fall off the table and actually go negative ... is a sign of what's going on in the economy at large,” he added.
Don’t expect higher oil prices for some time, says one energy analyst. “The markets are still worried that we will not have freedom of movement, and we will not see demand recover until some time in the summer, and there’s a lot of debate,” Regina Mayor, global head of energy for KPMG, told Yahoo Finance. “Personally I'm very bearish on crude price beyond 2020 and even into 2021,” she added. On Tuesday, US crude futures for June delivery cratered along with Brent crude amid a collapse in oil demand due to COVID-19.