by Arcas0
Everything’s fine.
Maybe you got furloughed, that’s ok. You’re probably making more on unemployment now. Everything’s fine.
Now you have time to learn how to bake, maybe finally sleep in and play some video games. Maybe start looking for a better job. You were thinking about quitting anyway. It’s basically summer break with a pay raise. Everything’s fine. We should do this pandemic thing every few years.
Maybe you’re a small business owner, you’re fine too. State is locked down, so no customers, but that’s ok. The government is paying your entire payroll and rent. States are already opening up, soon you’ll be back to normal. Everything’s fine.
Big business? Government’s got some loans for you too, low interest even. Fed is buying your junk bonds, so cash flow is no problem. And if you start to struggle, you’ll even get some free government money too. Costs are down since you just furloughed half your workforce onto unemployment, hey they’re probably making more unemployed anyway. Everything’s fine.
Or maybe you’re working from home. This pandemic isn’t so bad; you get to wear pajamas all day. No commute so you can sleep in, and when you do drive you’ve never seen the traffic this light. Everything’s fine. The stores are all closed, so maybe you’ll buy some dumb shit on Amazon with your $1,200 stimulus. Everything’s fine.
Fast Forward to Mid-June
PPP (Small Business Grants) lasts 8 weeks. We’re 2-3 weeks in, so lets say PPP starts running out around mid-June. All those furloughed workers you brought back kicking and screaming (they were making more on unemployment) so you could pay your rent with the remaining 25% are getting laid off again, this time permanently. But that’s ok, we’ve got the extra $600 unemployment on steroids, time for another pay raise.
By this time there’ll be around a month-ish left on the PUA (Unemployment on Steroids) and being laid off from your shitty bartending job won’t feel like a 4 month paid vacation with a little extra spending money, the clock is ticking. Maybe time to actually look for a new job this time…
Well everyone else is thinking the same thing. Small business jobs are evaporating, people actually starting to fear the $600/week going away, states are starting to enforce the job seeking requirements, so even the people who never got called back are sending out a flood of applications to keep their poverty $300/week going.
The government’s spent, what, $4-7 Trillion by this point. Interest rates already at zero, but the only people borrowing are big businesses who are hemorrhaging money at this point. Remember, we were at the peak of a decade long bubble? Fuelled by corporate debt? Now those chickens are coming home to roost too. The Fed can’t buy your junk bonds forever.
The government blew their load too early and it’ll start looking like a real bone fide recession. State and municipal budgets are mega-f*cked since they rely on sales tax revenue and unemployment checks come right out of their treasury. 50/50 on whether Trump decides to bail them out, if not then add a bunch of teachers, paramedics, construction workers, and paper pushers to the unemployed job seekers line.
The ride’s over folks. By August it’ll be “job musical chairs” and when the music stops you better hope you have one.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence.