- Eighty percent of economists surveyed by NABE said they see a 1-in-4 chance of a double-dip recession.
- The survey, by the National Association of Business Economists, also gave Congress a mixed review when considering its fiscal stimulus effort, but the Fed got the best grade since 2007 for its monetary policy response.
- The economists are concerned about the increasing amount of U.S. debt, with 88% at least “somewhat” concerned and 22% are very concerned.
Among advanced economies, debt rose to 128% of global gross domestic product as of July, according to the International Monetary Fund. In 1946, it came to 124%.
For now, governments shouldn’t worry about mounting debt and instead focus on bringing the virus under control, said Glenn Hubbard, chairman of the Council of Economic Advisers under President George W. Bush.
The coronavirus recession that began as a short-term shutdown devastating low-wage workers is now bearing down on white-collar America, where employers have been slower to rehire and job losses are more likely to be permanent.
Lower-paid workers are losing their jobs at about three times the rate of higher-wage employees. But the drop in overall employment that white-collar industries like real estate, information and professional and technology services have seen in five months is already on par with or worse than the hits they took during the Great Recession — underscoring how even highly paid workers with the ability to telework are vulnerable now.
As the economy begins to crawl back toward its pre-coronavirus normal, lower-paying industries are recovering at a faster clip than those at the higher end of the pay scale, where new job postings have been weak by comparison. Job postings for higher-wage occupations — those offering roughly $50,000 or more annually — remain 28 percent below last year’s trend, while lower-wage postings for jobs offering around $30,000 or less are down only 12 percent, according to the hiring platform Indeed.
“It pains me to say this, but bankruptcy is a growth industry in America”
One of the most alarming facts about this crisis is the pace at which bankruptcies are rising. Despite an $11 trillion liquidity injection and government aid in 2020, stocks and bonds at all-time highs and sovereign as well as corporate yields at all-time lows, companies are going bust at the fastest pace since the Great Depression.
The coronavirus crisis will see the world’s biggest firms slash dividend payouts between 17%-23% this year or what could be as much as $400 billion, a new report has shown, although sectors such as tech are fighting the trend.
You can smell it in the air. Some hard times coming. Everything just seems fucky.
— Arbitrage.Andy (@arbitrage_andy) August 24, 2020
Current multiple expansion inline with GFC, but well ahead of the average bull market. pic.twitter.com/bGr4U5JhtK
— Strategas (@StrategasRP) August 24, 2020
Morgan Stanley Warns "The First Tradable Correction Could Begin Imminently" t.co/RFTyCHENuJ
— zerohedge (@zerohedge) August 24, 2020