by Michael Sainato in Orlando, Florida on (#57ESE)
Facing massive medical and funeral bills, families, some of whom are out of work, are seeking help through fundraisersOn the morning of 19 August, 74-year-old Miguel Ramos passed away while hospitalized for Covid-19 in Orlando, Florida. His wife, Leticia, also tested positive and is currently fighting to recover.Facing thousands of dollars in funeral and medical expenses, their daughter Nohemi Ramos started a GoFundMe to try to raise money to cover some of the costs.Related: ‘Coming here is a necessity’: demand for food aid soars in US amid job lossesWe would have been able to cover the costs if we were working, but since everyone got sick at home, no one was able to work and bills kept coming Continue reading...
Chair Jerome Powell says inflation will be allowed to rise above 2% to boost employmentShare prices on Wall Street rose to a fresh high after the head of the US central bank paved the way for years of more pro-growth policies by softening its approach to inflation.Jerome Powell, the chairman of the Federal Reserve, said he and his policymaking colleagues in Washington had unanimously agreed that inflation would be allowed to rise above its 2% target for some time in order to boost employment. Continue reading...
by Nina Lakhani in Pittsburgh and Beaver county on (#57BD6)
Nationwide the need for aid at food banks and pantries has surged amid worst unemployment rate in modern timesNeisha Davis cradles brown paper lunch bags in the crook of one arm, while holding on to Demitri, her wriggling baby son, in the other and keeping a careful eye on Naya, her four-year-old daughter, as she runs around the church car park with another little girl.It’s hectic but the free packed lunches have become a crucial part of their daily nutrition. So everyday at noon the family make the two-mile journey from Homewood, a low income predominantly African American Pittsburgh neighbourhood with no grocery stores, to the East End Community Ministry’s pop-up lunch stall in East Liberty.Hunger always impacts children hardestRelated: Making billions v making ends meet: how the pandemic has split the US economy in twoHonestly, I’ve broken down thinking about food. I’m here because I can’t let my pride stop me from doing what I need to do Continue reading...
In the short term, probably not, but with China weaponising the yuan stern challenges lie aheadThe recent sharp depreciation of the US dollar has led to concerns that it may lose its role as the main global reserve currency. After all, in addition to the Federal Reserve’s aggressive monetary easing – which threatens to debase the world’s key fiat currency even further – gold prices and inflation expectations have also been rising.But, to paraphrase Mark Twain, reports of the dollar’s early demise are greatly exaggerated. The greenback’s recent weakness is driven by shorter-term cyclical factors. In the long run, the situation is more complicated: the dollar has both strengths and weaknesses that may or may not undermine its global position over time.Related: Price of gold should not determine US monetary policy | Jeffrey Frankel Continue reading...
Economist who argued against neoliberalism and was one of those advising the Labour leadership on the development of policyJohn Weeks, who has died aged 79, was one of a group of prominent economists who, after the global financial crisis of 2008, began to push back against the dominant economic ideology of neoliberalism. Based in Britain after moving from the US in 1990, he took part in the Occupy movement against economic inequality and blogged on the Open Democracy and Social Europe websites. Latterly he was the driving force behind the Progressive Economy Forum (PEF), a body of academics and economists that was influential – although arguably not influential enough – in the development of Labour party policy during the Jeremy Corbyn years.As PEF coordinator, John established links between its economists and Labour’s shadow treasury office under the shadow chancellor, John McDonnell. Through various means, including the commissioning of papers on a universal basic income and shorter working hours, the setting up of a workshop with McDonnell’s office to consider Bank of England macro prudential policy, the staging of a series of public lectures and through informal meetings with McDonnell and members of his team, PEF was able to work up policies that appeared in the 2019 Labour manifesto. Continue reading...
Richard Murphy and Colin Hines stress the importance of the government spending money on creating jobs as well as on infrastructure to deal with the impact of coronavirus on people and the planetYour editorial (19 August) correctly points to the fact that the “money no problem” approach to tackling the short-term upheavals caused by coronavirus must now shift to tackling the climate crisis. If not, it risks the further alienation of young climate protesters, the exceptional Greta Thunberg and the countless environmental campaigners active over the past few decades. The catalyst for this is the need for new jobs in every community to counter the political, economic and personal trauma that will come in the wake of the coming tsunami of lost livelihoods across the country.An answer to the inevitable question of how to pay for such a transformation was provide by Larry Elliott’s observation (18 August) that the government’s money-printing programme of quantitative easing (QE) inflates the assets of the already rich, rather than helping rebuild the real economy. Given rising unemployment, it’s likely that QE is going to be required for some time to come. In that case, the government’s e-money printing presses must be used to help fund the employment of the millions of increased staff needed across all social sectors, from more care and health workers to teachers and police, while also funding investment in new climate-friendly infrastructure projects, such as making the UK’s 30m buildings carbon neutral and adapting existing infrastructure to deal with future heatwaves and flooding. This would be a serious start to healing the damage currently being inflicted on people as well as the planet.
Even if the only objective was low and stable inflation it would be a bad ideaThe price of gold reached an all-time high of $2,000 per ounce in early August. And while mainstream economists have treated gold as a sideshow since the world abandoned the gold standard in 1971, this recent price increase is a significant signal.Three explanations for the elevated gold price – related to US monetary policy, risk and investors’ growing desire for a safe-haven alternative to the dollar – have been offered. Each contains some truth.Related: Forget doom-laden headlines, the dollar has not gone into terminal decline | Barry Eichengreen Continue reading...
The pandemic has forced the Tories into a change of direction even sharper than Edward Heath’s. But the crisis is not abatingBoris Johnson is shaping up to be a busted flush. In a remarkably short time he has lost the confidence of the country, Europe and, more important from his own narrow point of view, the Conservative party.Johnson is probably the worst British prime minister since Lord North, who is remembered for having lost the American colonies. These days the best thing about North is that he is remembered in the name of rather a good racehorse.Commentators keep calling this a recession. It is not: it is a hammer-blow to the economy administered by a panic-stricken government Continue reading...
by Larry Elliott and Richard Partington on (#57722)
Despite looking anything but fearless as Covid-19 first struck, US markets have regained lost ground and reached new highs. We list the reasons whyNothing like the recovery in the US stock market has ever been seen before. After the Wall Street Crash of 1929, the time it took for shares to regain their previous peak was measured in decades. After the global financial crisis of 2008, it was measured in years. This time it has taken less than five months – from a low on 23 March – for the S&P 500 to regain all its lost ground and hit a new high. At the time, not even the most bullish trader would have been bet on such a rapid recovery, but five factors explain the remarkable turnaround. Continue reading...
August PMIs for services and manufacturing show retreat from July’s bouncebackThe eurozone’s recovery from its deepest economic downturn on record hit the brakes in August, as pent-up demand unleashed by the easing of coronavirus lockdowns dwindled, according to a closely watched survey.After many of the initial Covid-19 restrictions were relaxed, activity in the eurozone expanded in July at the fastest pace since mid-2018. But as infection rates have risen again in parts of the region, some earlier curbs have been reinstated. Continue reading...
But ONS finds four in five businesses stating that their risk of closing down is lowOne in eight members of the UK workforce, equating to more than three million people, were under furlough as the government’s wage subsidy scheme began to be phased out, the latest official data shows.The regular update on the economy from the Office for National Statistics found that 12% of workers were furloughed between late July and the middle of August, half the number two months earlier. Among the businesses trading 11% of the workforce was furloughed, rising to 71% for the 4% of firms that had not yet re-opened. Continue reading...
Increase of 135,000 from the previous week’s revised level of claims suggest that layoffs increased last weekThe number of people applying for unemployment benefits climbed back over 1 million last week as the coronavirus continued to take a devastating toll on the job market.The labor department announced on Friday that it received 1.1m claims for benefits last week, an increase of 135,000 from the previous week’s revised level and suggesting that layoffs increased last week. Continue reading...
There are millions unemployed, but plenty of work to do. How about a Pandemic Jobs Program that pulls in elements of the Green New Deal?In America, it seems, workers always come last. With more than 31 million out-of-work Americans now cut off from enhanced unemployment benefits, and with Washington’s failure to deliver relief, working families and the broader economy are set to fall off a cliff.Related: USPS crisis: postmaster general to suspend all changes until after electionThe federal government must play a bigger role in ensuring workers earn a living wage – especially in this crisisMoira Herbst is a writer based in New York Continue reading...
by Larry Elliott and Kalyeena Makortoff on (#571TX)
Shares in S&P 500 are up 50% on Covid trough in late MarchWall Street’s rapid recovery from its Covid-19 slump has entered a new phase after a leading yardstick of American shares briefly hit a record high.In early trading in New York the S&P 500, which measures the stock market valuation of the 500 leading US quoted companies, rose to 3,394.82, exceeding its previous high by a single point. Continue reading...
Central bank intervention reassured the financial system, but the real world outlook is bleak – just ask M&S workers in the UKIt is business as usual on Wall Street. Forget that the US economy shrank by almost a tenth between April and June. Forget that the official unemployment rate is 11%. The only news that matters is that the stock market has topped pre-crisis levels.That’s not only true in the US. The Financial Times index of global shares is almost back to where it was in the happy days when only a few health experts had heard of Covid-19. There is much talk – almost all of it the product of wishful thinking – about a V-shaped recovery from the pandemic. The one place it is certainly happening is in the world’s bourses.Related: The Tories are trying to stymie the disruption that the economy so badly needs | Christine Berry Continue reading...
Houston’s rental aid fund was empty 90 minutes after it opened. In Chicago, 80,000 renters applied for 2,000 relief grantsIt’s already started. A majority of US states have resumed evictions, or are allowing them despite the worsening pandemic.As many as 40 million people nationwide face eviction due to inability to pay rent. In comparison, the 2008 foreclosure crisis saw the loss of 10m homes. Now, millions – seniors, people with disabilities, parents and children – are at risk of homelessness. Eviction preys disproportionately, in many places overwhelmingly, on Black women and people of color, deepening savage racial inequities.Related: Wave of evictions sweeps US amid impasse over coronavirus protectionsRent relief funds alone cannot resolve the renter crisis aggravated by the pandemicLupe Arreola is executive director of Tenants Together in California, a statewide coalition of tenant organizations and an anchor organization of the national Homes for All campaign and the Right to the City Alliance. Amee Chew, PhD, is a Mellon-ACLS public fellow who works in housing policy. Together, they have collaborated with national housing justice organizations on OurHomesOurHealth.org Continue reading...
Economic disruption can be harnessed for good, like tackling climate change: but right now we have all pain and no gain“The pandemic is a portal,” wrote Arundhati Roy back in April. It has since become commonplace to argue that coronavirus has created both a need and an opportunity for fundamental change. Though we might like to pretend otherwise, the kind of deep-seated changes we need to confront our ongoing crises would certainly be disruptive. Retiring dirty industries and growing clean ones is disruptive. Shifting from an economy that bids up land values to one that does socially useful things is disruptive. Redressing the imbalance between London and the rest of the country is disruptive.The pandemic means that much of this disruption is now happening anyway. We are enduring the pain – so couldn’t this be an opportunity to gain?Does the fall in commercial property values provide a chance to bring land back into public or community ownership?Related: Britain doesn't have a government, it has a permanent campaigning machine | Alan Finlayson Continue reading...
Jubilee Debt Campaign reveals sharp rise in number of countries in distress since 2018Developing nation debt has more than doubled in the past decade and left more than 50 countries facing a repayment crisis, according to a campaign group.Data from the Jubilee Debt Campaign shows that even without taking full account of the impact of the coronavirus pandemic, there has been a sharp jump in the number of poor countries in debt distress since 2018.Country-by-country annual external government debt payments, as a percentage of government revenue.The extent to which a whole country (public and private sector) was a net financial creditor or debtor to the rest of the world.The size of a country’s private external debt.How much a country was paying to and earning from the rest of the world each year (its current account balance).IMF debt risk ratings. Continue reading...