Economy

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earthling
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Economy

Post by earthling »

April 2020 metro jobs data released per industry.

As expected KC metro's Leisure/Hospitality took biggest hit, down nearly 50% from Feb to April and from previous April. Construction actually shows growth compared to previous April, the only industry.

May on through summer expected to show harder hit with office jobs while some hospitality jobs start to return.

KC metro took a 10.6% hit overall compared to previous April, better than US avg. NYC took a 20% hit overall. Missouri took an 11.3% hit and STL 11.5%. Michigan appears to have taken hardest hit with 23% decline.

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https://www.bls.gov/eag/eag.mo_kansascity_msa.htm

earthling
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Re: Economy

Post by earthling »

An Open Table survey says that 25% of restaurants likely won't return. KC metro may fare a bit better given overall less impact than US avg but with servers often currently making more on unemployment, could be hard to attract workers.

https://www.marketwatch.com/story/1-in- ... =home-page

earthling
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Re: Economy

Post by earthling »

Covid-19 sends KCI passenger traffic into a nose dive in April
https://www.bizjournals.com/kansascity/ ... lines.html
Slightly more than 42,000 passengers departed from or arrived at KCI in April, according to Aviation Department statistics. That compares with more than 467,000 passengers, each, departing and arriving at the airport the previous year.

earthling
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Re: Economy

Post by earthling »

As expected, office workers will be hit harder next as service industry returns..

IBM laying off thousands, seeking “flexibility” during COVID-19 crisis
https://arstechnica.com/information-tec ... 19-crisis/

And many who avoided furlough/layoffs are hit with pay cuts. Consumer confidence will get worse when Federal aid ends.
https://www.google.com/search?q=pay+cut ... 80&bih=635

aknowledgeableperson
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Re: Economy

Post by aknowledgeableperson »

https://www.msn.com/en-us/news/us/about ... plocalnews

"About 1,000 contract employees of a federal agency have received notice that their jobs face elimination in what would be one of the largest mass layoffs of the year for the Kansas City area."

earthling
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Re: Economy

Post by earthling »

As of April...
Missouri's 'official' unemployment rate is among lowest at 9.7%.
Kansas is a bit below US average at 11.2%.
US Avg is about 14%.

As expected, the troubled COVID states have well above avg unemployment.. NY, MI, LA, IL, IN, WA. Nevada approaching 30%.
Michigan is nearly 23%. May of course will jump higher.

The 'real' unemployment is quite a bit higher as there's a lag in unemployment claims, some don't bother to report, and the labor force shrinks because many give up or don't report looking even though they lost their jobs. The real labor force is likely much higher. Historically April labor force is typically higher than Feb but isn't now.

Metro numbers should come out soon.

All states...
https://www.bls.gov/regions/home.htm

earthling
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Re: Economy

Post by earthling »


earthling
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Re: Economy

Post by earthling »

im2kull wrote:
Mon May 25, 2020 4:02 pm
earthling wrote:
Mon May 25, 2020 2:44 am
^Hope for the best, prepare for the worst. The downhill snowball effect is just getting started. There aren't any indicators to suggest a return to where we were in 18 months. Consumer confidence will probably be low at least until there is a vaccine but even then there's still a snowball effect that we haven't' seen since the Great Depression.

The 2008 recession wasn't anywhere close to this and took over 6 years to get back to 2008 levels in terms of jobs. And the unemployment rate took even longer to recover where it was because the labor force continued to grow.
The difference is that;

1. Our economy was already weak leading up to the 2008 recession.. instead of the barreling train that it was just a few months ago.
2. THIS economic situation was entirely man made. It's the result of our decisions. THAT can be undone rather quickly (IE: By reopening).
3. Please stop using verbiage such as "Until there is a vaccine" and spreading this false sense that there WILL be a vaccine. There likely will NEVER be a vaccine. That's the simple reality of science. Hearing people talk about vaccines as if we can magically formulate one from thin air at our discretion is ridiculous. We don't even have a foolproof method of testing for the virus right now. Thinking that we'll somehow create a vaccine for an RNA based virus in the next few months is absurd and completely out of touch with reality. Treatments, sure. But vaccines are a whole different ball game. We have millions of treatments for diseases all over the globe, but we only have 26 vaccines. TWENTY SIX. Wrap your head around that. Do people NOT realize these simple facts and what they mean? We simply do not have the answers or the capable to create the answers to every medical question out there. It is 2020. Not 2398423948. We are only a few years removed from wiping our asses with toliet paper. Just kidding.. We're absolute animals. We are not an advanced species or society. We are crude. Basic. Raw. Our science is politically charged and unimaginative. We are constrained to these realities. Welcome to Earth, 2020. This is going to be as common and ever lasting as the seasonal flu.
Agree with all of that but doesn't alter my points about economy returning in 18 months being a very optimistic view. The vaccine comment was about consumer confidence, which is partly relied on perception. Agree there might not even be a working vaccine (almost pointed that out) but many are expecting one and confidence may not return until there is one (or the virus is under some form of control and out of the news) - neither might not happen in 18 months.

And agree we made a decision to kill the economy with perception it was the only way to save lives but the snowball effect may be out of control of the man-made trigger.

The economy and stock market are partly driven by emotions. Is why I pulled out of the market and into private equity. The bottom line is that it would be highly optimistic thinking that economy will return to where it was in Feb in 18 months. Could happen but there are no indicators leading that it would occur that soon and we've never experienced anything like this with such a cross-dependent globalized economy.

So do you think there will be a V-shaped return? What's the case for that?

earthling
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Re: Economy

Post by earthling »

grovester wrote:
Mon May 25, 2020 5:37 pm
earthling wrote:
Mon May 25, 2020 2:44 am
^Hope for the best, prepare for the worst. The downhill snowball effect is just getting started. There aren't any indicators to suggest a return to where we were in 18 months. Consumer confidence will probably be low at least until there is a vaccine but even then there's still a snowball effect that we haven't' seen since the Great Depression.

The 2008 recession wasn't anywhere close to this and took over 6 years to get back to 2008 levels in terms of jobs. And the unemployment rate took even longer to recover where it was because the labor force continued to grow.

KC might fare better than US avg but maybe not with hotels given occupancy wasn't all that great before COVID due to so many hotel rooms coming online. Will become more difficult to compete with other cities for conventions too and we don't understand the airline impact, which is clearly more severe than any event in its industry. And car rental impact. Hertz is over 100 years old and filed for bankruptcy out of nowhere, putting auto industry in jeopardy with possibly liquidating 100K-150K fairly new used cars on fire sale. Such snowball effects we haven't thought of yet will likely continue for many months.

We haven't seen anything like this so who knows. No one can predict how long it will take to return to where we were. Could highly optimistically be within a couple years but wouldn't be surprising if over 15 years.
The other thing to consider regarding 2008 recession: the congress at the time was not interested in having the economy recover quickly. I would hope that the current crisis might have a different result, but won't know until after the election.
So what indicators are there that we'll see a nearly V-shape return within 18 months? Not saying it won't happen but many economists say it's optimistic as we are now experiencing unforseen snowball effects not anticipated. A 15 year return might be more realistic than an 18 month return but nobody knows.

What indicators do you see that Scenario 1 will occur. There are already many indicators that Scenario 2 is in progress.

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