Written by rjs, MarketWatch 666
News posted last week about economic effects related to the coronavirus 2019-nCoV (aka SARS-CoV-2), which produces COVID-19 disease, has been surveyed and some articles are summarized here. We cover the latest economic data, especially the prospects for an infrastructure bill, stimulus checks, government funding, the Fed, the latest employment data, housing market reports, mortgage delinquencies & forbearance, travel, layoffs, lockdowns, and schools, as well as infrastructure and GDP. The bulk of the news is from the U.S., with a few more articles from overseas at the end. (Picture below is morning rush hour in downtown Chicago, 20 March 2020.) News items about epidemiology and other medical news for the virus are reported in a companion article.
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I have included all I had on GDP; kept infrastructure news to a broad outline, except for those wherein the follow-on reconciliation package is mentioned. I considered most mask and vaccine mandates to be “economic news” rather than disease news. A lot of vaccine news is in part 1 regardless.
The news:
Another Fed Balance Sheet Record; Where’s The Exit Door? –For months, the markets have anticipated the Fed tightening monetary policy in order to take on rising inflation.At the June FOMC meeting, the central bank even hinted that it might start raising interest rates in 2023 instead of 2024, and the central bankers apparently talked about talking about tapering their quantitative easing bond-buying program. But with all of this talk, the loose monetary policy driving inflation continues unabated. Interest rates remain pegged at zero. The Fed balance sheet sets new records week after week. Where exactly is the exit door?Today, markets eagerly await whatever pronouncements that come out of the Federal Reserve’s July meeting. Analysts and pundits in the financial media will scrutinize every punctuation mark in the FOMC statement and dissect every word that tumbles out of Jerome Powell’s mouth in the coming days. But it’s a near certainty the Fed won’t do anything. It won’t raise interest rates. And it will continue expanding its balance sheet at a torrid pace.As of July 21, the Fed balance sheet stood at a record $8.24 trillion. In the previous week, the central bank expanded the balance sheet by $39 billion. In July alone, the Fed has added $162 billion to its balance sheet. The Fed can talk about tapering all it wants. The markets can expect the Fed to give up its “transitory inflation” narrative and turn to tightening all they want. But the reality is extraordinary monetary policy continues unabated.And there’s no sign it will stop any time soon.
FOMC Preview: Probably Too Soon for Hints on Tapering –Expectations are there will be no change to rate policy when the FOMC meets on Tuesday and Wednesday this week. Analysts will be looking for any hints as to when the Fed will start to taper asset purchases, although it is probably too early – especially given possible economic downside risks due to the resurgence in COVID cases – for the Fed to drop hints on tapering this week. Here are some comments from Goldman Sachs economists on the timing of tapering:Fed officials have said that they intend to signal that tapering is coming “well in advance,” a phrase they also used in reference to the start of balance sheet runoff in 2017. That precedent suggests that “well in advance” means two meetings worth of hints before the formal announcement, consistent with our expectation of a first hint in September, a second hint in November, and a formal announcement of tapering in December.Analysts will also be looking for comments on inflation, although the Fed is probably not too concerned with inflation right now. Some of the recent increase in inflation was due to base effects (prices declined at the beginning of the pandemic), and some probably due to transitory effects related to supply bottlenecks. Note: No projections will be released at this meeting. However, for review, here are the June FOMC projections.Wall Street forecasts are for GDP to increase at a 8.6% annual rate in Q2 (to be released this coming Thursday). This is lower than most forecasts when the Fed last met in June. So the FOMC projections for 2021 may now be a little on the high side compared to Wall Street.GDP projections of Federal Reserve Governors and Reserve Bank presidents, Change in Real GDP: Projections of change in real GDP and inflation are from the fourth quarter of the previous year to the fourth quarter of the year indicated. The unemployment rate was at 5.9% in June. Note that the unemployment rate doesn’t remotely capture the economic damage to the labor market. Not only are there 3.7 million more people currently unemployed than prior to the pandemic, over 3.4 million people have left the labor force since February 2020. And millions more are being supported by various provisions of the disaster relief acts. Unemployment projections of Federal Reserve Governors and Reserve Bank presidents, Projections for the unemployment rate are for the average civilian unemployment rate in the fourth quarter of the year indicated. The decline in the unemployment rate depends on both job growth, and the participation rate. A strong labor market will probably encourage people to return to the labor force, and the improvements in the unemployment rate might be slower than some expect. As of May 2021, PCE inflation was up 3.9% from May 2020. Inflation projections of Federal Reserve Governors and Reserve Bank presidents, PCE Inflation: PCE core inflation was up 3.4% in May year-over-year.
FOMC Admits Economy’s “Made Progress” Towards Taper Goals -Since the last FOMC statement (June 16th), there is one big loser – gold (although, as the chart shows, all of that loss was ‘engineered’ the day after The Fed). The dollar, bonds, and stocks are all higher with bonds best… Over the same period, the market’s expectations for Fed action have surged hawkishly and tumbled dovishly most recently, leaving them basically unchanged since the last FOMC statement… The Fed started by admitting hawkishly that they had made progress towards goals laid out to taper (of “substantial further progress”), and enacted a permanent backstop for money markets (with a permanent domestic and foreign repo facility).Last December, the Committee indicated that it would continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month untilsubstantial further progress has been made toward its maximum employment and price stability goals.Since then, the economy has made progress toward these goals, and the Committee will continue to assess progress in coming meetingsThey did given themselves an excuse to wait:“The sectors most adversely affected by the pandemic have shown improvement but have not fully recovered “On inflation, still transitory:“Inflation has risen, largely reflecting transitory factors.”Notably, with regard to the “delta” variant, the statement sounded a bit hawkish because it didn’t highlight the resurgence of the delta variant. It said:“The path of the economy continues to depend on the course of the virus.”In comparison, the June statement read:“The path of the economy will depend significantly on the course of the virus.”The Fed also removed this line entirely…“Progress on vaccinations has reduced the spread of COVID-19 in the United States”
FOMC Statement: No Policy Change; Economy has “made progress” -Fed Chair Powell press conference video here starting at 2:30 PM ET. FOMC Statement: The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.With progress on vaccinations and strong policy support, indicators of economic activity and employment have continued to strengthen. The sectors most adversely affected by the pandemic have shown improvement but have not fully recovered. Inflation has risen, largely reflecting transitory factors. Overall financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses. The path of the economy continues to depend on the course of the virus. Progress on vaccinations will likely continue to reduce the effects of the public health crisis on the economy, but risks to the economic outlook remain. The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. With inflation having run persistently below this longer-run goal, the Committee will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer‑term inflation expectations remain well anchored at 2 percent. The Committee expects to maintain an accommodative stance of monetary policy until these outcomes are achieved. The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee’s assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time. Last December, the Committee indicated that it would continue to increase its holdings of Treasury securities by at least $80 billion per month and of agency mortgage‑backed securities by at least $40 billion per month until substantial further progress has been made toward its maximum employment and price stability goals. Since then, the economy has made progress toward these goals, and the Committee will continue to assess progress in coming meetings. These asset purchases help foster smooth market functioning and accommodative financial conditions, thereby supporting the flow of credit to households and businesses. In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals. The Committee’s assessments will take into account a wide range of information, including readings on public health, labor market conditions, inflation pressures and inflation expectations, and financial and international developments.
Fed Launches Foreign, Domestic Standing Repo Facilities –As was heavily hinted at in the June FOMC Minutes, moments ago in addition to its slightly dovish FOMC statement, the NY Fed unveiled that at long last it was establishing two standing repo facilities: one for domestic counterparties, and one for foreign and international monetary authorities (FIMA repo facility).The domestic Standing Repo Facility will have a minimum bid rate of 0.25 percent and with an aggregate operation limit of $500 billion, and will be cleared and settled on the tri-party repo platform. This is largely a replica of the existing repo facility.More importantly, the Fed is also launching an foreign overnight repo facility which will offer overnight repo at a rate of 0.25% to foreign central bank and international accounts against their holdings of Treasury securities maintained in custody at the New York Fed, subject to a per-counterparty limit of $60 billion.As the NY Fed adds, these facilities will serve as backstops in money markets to support the effective implementation of monetary policy and smooth market functioning. In other words, going forward any institutions that face a funding shortage can pledge whatever collateral they have with the Fed and receive liquidity instantly. This should substantially eliminate the risk of significant dollar funding crises in the future.More details from the New York Fed: Under the SRF, the FOMC directed the Open Market Trading Desk (the Desk) at the Federal Reserve Bank of New York to conduct overnight repo operations with a minimum bid rate of 0.25 percent and with an aggregate operation limit of $500 billion, effective July 29, 2021. As with the Desk’s existing repo operations, the SRF will be cleared and settled on the tri-party repo platform. Treasury, agency debt, and agency mortgage-backed securities will continue to be accepted. All other terms will be the same as the existing overnight repo operations. Primary dealers will continue to be counterparties for repo operations under the SRF. The SRF counterparties will be expanded to include additional depository institutions. Initially, criteria will be established to effectively manage onboarding of interested depository institutions. Consistent with the New York Fed’s commitment to ensuring its counterparty policies promote a fair and competitive marketplace, these criteria will be adjusted over time to expand depository institution eligibility. The initial criteria will allow depository institutions with holdings of Treasury, agency debt, and agency mortgage-backed securities greater than $5 billion as of June 30, 2021 or with total assets greater than $30 billion to express interest starting on October 1, 2021. All counterparties must be able to transact on the tri-party repo platform.
The Fed Announces Plans to Permanently Backstop Wall Street with a Standing Repo Loan Facility of $500 Billion … Starting Tomorrow – By Pam Martens -You really can’t make this stuff up. A G30 Working Group Chaired by Tim Geithner, the former President of the New York Fed, that secretly sluiced $29 trillion to bail out the Wall Street banks from their hubristic collapse in 2008, released a report today calling for a Standing Repo Facility from the Fed that would be “open to a broad range of market participants … .”The ink was barely dry on that report when the Fedissued a press release today saying it was doing just that. The Standing Repo Facility (effectively meaning that it is permanent until the Fed says otherwise) will be able to lend out $500 billion in overnight loans each day at below-market interest rates. If the $500 billion runs out, Fed Chair Jerome Powellhas the discretion to increase it. The repo operations will be conducted by the Open Market Desk of the New York Fed – which means that the names of the banks getting the loans will never see the light of day, unless a media powerhouse decides to stand up for democracy and transparency and take the Fed to Court.The cringe-worthy name of Geithner is enhanced by two other cringe-worthy members of the Working Group: Larry Summers, who helped repeal the Glass-Steagall Act so that Frankenbanks on Wall Street could hold trillions of dollars of risky derivatives alongside trillions of dollars of taxpayer-backstopped deposits from moms and pops; and Bill Dudley, another former President of the New York Fed whose wife collected $190,000 a year from JPMorgan Chase, while it was “supervised” by the New York Fed.Unlike the Federal Reserve Board, the New York Fed is not a federal agency. It is privately owned by the mega banks on Wall Street. See These Are the Banks that Own the New York Fed and Its Money Button.To spin the appearance that this isn’t just a bailout of the trading units of the mega banks on Wall Street (the so-called “Primary Dealers” who are already approved counterparties for the Fed’s repo operations), the Fed announced that the Standing Repo Facility (SRF) will be expanded to other financial institutions. The New York Fed clarified that as follows: “Primary dealers will continue to be counterparties for repo operations under the SRF. The SRF counterparties will be expanded to include additional depository institutions. Initially, criteria will be established to effectively manage onboarding of interested depository institutions. Consistent with the New York Fed’s commitment to ensuring its counterparty policies promote a fair and competitive marketplace, these criteria will be adjusted over time to expand depository institution eligibility. The initial criteria will allow depository institutions with holdings of Treasury, agency debt, and agency mortgage-backed securities greater than $5 billion as of June 30, 2021 or with total assets greater than $30 billion to express interest starting on October 1, 2021. All counterparties must be able to transact on the tri-party repo platform.”The Fed also announced that it is creating a standing repo facility for foreign and international monetary authorities (FIMA). The New York Fed explained that facility as follows: The Fed seems to be sensing some urgency to standing up these permanent new facilities. The domestic repo facility, loaded with $500 billion, is to become effective tomorrow.
Fed maintains money flow to Wall Street – The US Federal Reserve has kept its base interest rate at near zero and maintained its asset purchases at the rate of $120 billion a month. That decision, announced yesterday after a two-day meeting of its policy-making committee, was expected. But in response to concerns by some members of the Fed’s governing body that the present sharp rise in inflation may prove to be permanent rather than a “transitory” effect of economic recovery from the pandemic, the official statement from the meeting hinted that “tapering” of its bond purchases may be closer than previously thought. Last December, the Fed said its asset purchases would continue until “substantial further progress” had been made toward its goals – full employment and 2 percent inflation. “Since then,” the statement said, “the economy has made progress towards these goals, and the committee will continue to assess progress in coming meetings.” This was widely interpreted as a signal that it was at least moving to a closer consideration of a wind-back in asset purchases. But Fed chair Jerome Powell, who has been characterised as occupying a centre position between the so-called doves and hawks within the governing body, made clear there were no immediate plans to withdraw the unprecedented levels of support the central bank has provided to financial markets and Wall Street. Despite the Fed’s claim that the US economy is on the road to recovery there are significant contradictory signals. While inflation is rising, along with economic growth, the yields on Treasury bonds have been falling – an indication that financial markets consider growth could stall, if not develop into a recession. Asked about the divergence between the economic growth outlook and the bond market at his press conference, Powell could offer no explanation apart from saying that it may be due to “technical” factors “where you put things you can’t quite explain.” The fall in bond yields, a result of increased demand and rise in their price (the two move in opposite directions), has been significant. In an interview on CNN Financial Times columnist and editorial board member Rana Foroohar said in her 30 years in finance journalism she had never seen so many variables – from the effect of the Delta variant, inflation, to lower growth in China – impacting on the global economic outlook. Apart from the continuing stimulus for Wall Street, another significant decision by the Fed was to establish a new facility to provide liquidity to big Wall Street banks as well as foreign central banks in times of financial turbulence. Under the facility, the Fed would enter overnight repurchase (repo) agreements in which it would take in Treasury debt and mortgage-backed securities in return for cash at a rate of 0.25 percent. There would be a daily cap on the facility of $500 billion. A similar facility would be extended to foreign central banks with a daily limit of $60 billion. The facility may also be expanded in the future to include deposit-taking banks. The new facility has been developed in response to the financial market crisis of March 2020 when the $21 trillion US Treasury market – the bedrock of US and global financial system – effectively froze in what was dubbed a “dash for cash” as buyers for Treasury debt disappeared. The measure has been under discussion for some time as the Fed continues to try to assess what took place in the March crisis. New York Fed chief John Williams said earlier this month that a standing repo facility would not be used much in normal times but if there was an “unanticipated shock” it would keep short-term interest rates from spiking. Its establishment indicates that another crisis on the scale of March 2020 could take place because none of the underlying problems and contradictions that gave rise to it have been resolved.
PCE Price Index Overshooting … or Undershooting -Menzie Chinn – William Luther at AIER asks “Is Inflation Merely Catching Up?“: … it is simply not the case that the observed inflation has merely been what was required for catching up. The price level today is greater than what it was expected to be in the absence of a pandemic and what the Fed implicitly said it would be given its two-percent inflation target. The price level has more than caught up with expectations. The question, now, is whether it will continue to grow so rapidly, remain elevated, or subside. In other words, his answer to the question posed in the title is “no”. Whether it has pernicious effects depends on how persistent inflation is relative to expected. I have graphed the data for the PCE price index, the Cleveland Fed’s nowcast as of 7/26, and WSJ July forecast against the 2015M01-2021M01 trend Dr. Luther cites, as well as the 2% trend. Figure 1: Personal Consumption Expenditure (PCE) price deflator (black), Cleveland Fed nowcast (gray line), WSJ survey mean (teal line), 2015M01-20M01 trend (light blue), 2% trend from 2020M01 (pink), all 2012=100, on log scale. Source: BEA, Cleveland Fed (accessed 7/26), WSJ July survey, and author’s calculations.Using Dr. Luther’s trend it seems clear that the PCE price index has overshot as of today, if the Cleveland Fed’s nowcasts are accepted. With inflation persistently higher than 2% (as indicated in the WSJ’s July survey of economists), then the price level continues to diverge from trend.As of July, the price level would be 1.3% above trend; and 1.5% by November 2023 (in log terms). Useful to compare with the fact that in April and May of 2020, the index was 1.2% below trend. Back in January of 2012, Jeffry Frieden and I called for conditional inflation now! at 4%-6% for several years. That call (if for 2%) implies the following: Figure 2: Personal Consumption Expenditure (PCE) price deflator (black), Cleveland Fed nowcast (gray line), WSJ survey mean (teal line), 2% trend from 2020M01 (pink), 2% trend from 2012M01 (red), all 2012=100, on log scale. Source: BEA, Cleveland Fed (accessed 7/26), WSJ July survey, and author’s calculations.From that perspective, we have a lot of catching up to do. As of July, the price level would be 3.4% below trend; and 3.3% by November 2023.Which one is the right comparison? Luther is right to interpret the shock as coming with the pandemic in early 2020. Moreover, Flexible Average Inflation Targeting (FAIT) can be dated as being effective in January 2020, so another reason to make that comparison. On the other hand, if we have been thinking trying to redress overly slow price inflation over the past decade in the wake of the Great Recession, then the calculations in Figure 2 are in some sense more appropriate.
PCE Price Index: June Core at 3.5% YoY – The BEA’s Personal Income and Outlays report for June was published this morning by the Bureau of Economic Analysis. The latest Headline PCE price index was up 0.51% month-over-month (MoM) and is up 3.99% year-over-year (YoY). Core PCE is now at 3.54%, above the Fed’s 2% target rate. Revisions were made.The adjacent thumbnail gives us a close-up of the trend in YoY Core PCE since January 2012. The first string of red data points highlights the 12 consecutive months when Core PCE hovered in a narrow range around its interim low. The second string highlights the lower range from late 2014 through 2015. Core PCE shifted higher in 2016 with a decline in 2017, 2019, and 2020. The first chart below shows the monthly year-over-year change in the personal consumption expenditures (PCE) price index since 2000. Also included is an overlay of the Core PCE (less Food and Energy) price index, which is Fed’s preferred indicator for gauging inflation. The two percent benchmark is the Fed’s conventional target for core inflation. Most recently, the Fed reviewed their monetary policy strategy and longer-term goals and released a statement, mentioning its federal mandate to promote “maximum employment, stable prices, and moderate long-term interest rates”. They also confirmed their commitment to using the two percent benchmark as a lower limit:
BEA: Real GDP increased at 6.5% Annualized Rate in Q2 -From the BEA: Gross Domestic Product, Second Quarter 2021 (Advance Estimate) and Annual Update: Real gross domestic product (GDP) increased at an annual rate of 6.5 percent in the second quarter of 2021, according to the “advance” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 6.3 percent (revised). …The increase in real GDP in the second quarter reflected increases in personal consumption expenditures (PCE), nonresidential fixed investment, exports, and state and local government spending that were partly offset by decreases in private inventory investment, residential fixed investment, and federal government spending. Imports, which are a subtraction in the calculation of GDP, increased. The advance Q2 GDP report, with 6.5% annualized growth, was well below expectations.
U.S. GDP rose 6.5% last quarter, well below expectations – The U.S. economy rose at a disappointing rate in the second quarter, the Commerce Department reported Thursday in a sign that the U.S. has escaped the shackles of the Covid-19 pandemic but still has more work to do. Gross domestic product, a measure of all goods and services produced during the April-to-June period, accelerated 6.5% on an annualized basis. That was slightly better than the 6.3% gain in the first quarter, which was revised down narrowly. While that would have been strong prior to the pandemic, the gain was considerably less than the 8.4% Dow Jones estimate. Gross private domestic investment fell 3.5% as declines in private inventory and residential investment held back gains. Rising imports and a 5% decline in the rate of federal government spending, despite the ballooning budget deficit, also were factors, the Bureau of Economic Analysis report said. The overall increase came thanks to increasing personal expenditures, which rose 11.8% as consumers accounted for 69% of all activity. Nonresidential fixed investment, exports and state and local government spending also helped boost output. The personal savings rate dropped sharply, tumbling to $1.97 trillion from $4.1 trillion in the previous period. The headline gain was a yardstick for how far the economy has come from the shutdowns imposed during the early days of the pandemic, when governments across the country halted large swaths of economic activity to combat Covid. At its nadir, the economy collapsed 31.4% in the second quarter of 2020; it bounced back 33.4% in the subsequent three-month period and has continued to push toward normal since. In the years prior to the pandemic, the Q2 gain would have been the strongest since the third quarter of 2003. Though output has remained below its pre-pandemic level, the National Bureau of Economic Research pronounced the recession that began in February 2020 to have ended just two months later, the shortest on record. However, the second quarter is likely to be the high point of the pandemic recovery. “The good news is that the economy has now surpassed its pre-pandemic level,” wrote Paul Ashworth, chief U.S. economist at Capital Economics. “But with the impact from the fiscal stimulus waning, surging prices weakening purchasing power, the delta variant running amok in the south and the saving rate lower than we thought, we expect GDP growth to slow to 3.5% annualized in the second half of this year.” Still, areas of the economy remain underwater as the labor market in particular has struggled to get back to normal. In a separate report Thursday, the Labor Department said 400,000 people filed initial claims for unemployment benefits for the week ended July 24. That level is nearly double the pre-pandemic norm and was above the 380,000 Dow Jones estimate. However, it was a decrease from the previous week’s 424,000.
GDP Rises 6.5 Percent in Second Quarter, Passed Pre-Pandemic Level of Output By Dean Baker -The economy grew at a 6.5 percent annual rate in the second quarter. This put GDP 0.8 percent above its last pre-pandemic quarter but still leaves it roughly 2.2 percent below its pre-pandemic trend.While the growth for the quarter was somewhat lower than had generally been expected, it would still likely imply strong productivity growth for the quarter. With the increase in hours worked likely to come in near 4.0 percent, the GDP figure would imply productivity growth near 2.5 percent. This is lower than the 4.1 percent rate from the first quarter of 2020 to the first quarter of 2021 but far above the 1.0 percent annual rate in the decade preceding the pandemic. If this sort of uptick in productivity growth could be sustained, it makes it unlikely that inflation would be a problem in the years ahead. This release included revised data for 2019 and 2020, as well as the first quarter of 2021. While revisions are often large and can reverse the story in the unrevised data, the revisions still show that profit share of corporate income falling from 2015 to 2020, with the 2020 share being the lowest since 2009. The revised data show a sharp uptick in profit shares from the 2020 average of 23.9 percent to 25.5 percent in the first quarter of 2021.The quarterly data are erratic and subject to large revisions, so the first-quarter data has to be viewed with caution. (The profit data for the second quarter will not be available until the preliminary GDP report is released in August.) However, a rise in profit shares is inconsistent with the story of employers being squeezed by rapidly rising wages resulting from a labor shortage.The saving rate continued to be very high in the second quarter. This is worth noting because it is after most of the pandemic checks were already sent. If people are going to spend large portions of the savings accumulated during the pandemic, then we should be seeing saving rates well below the pre-pandemic average. At least through the second quarter, this does not seem to be the case, meaning that this source of potential inflationary pressure is not currently a problem.Spending on services was the major factor driving second quarter growth, rising at a 12.0 percent annual rate and adding 5.1 percentage points to the quarter’s growth. Restaurants were the biggest factor in this growth adding 2.2 percentage points to GDP. Spending on recreation services added 0.8 percentage points to growth. Spending on goods also rose rapidly with spending on durable goods rising at a 9.9 percent rate and spending on nondurables rising at a 12.6 percent rate. This spending added 0.9 percentage points and 1.8 percentage points to growth, respectively. Even with the strong second-quarter growth, spending on consumer services was still 3.3 percent below the pre-pandemic level. By contrast, spending on durables (largely cars) was 28.6 percent higher, while spending on nondurables was 11.9 percent higher. It is likely that we will see weak growth in durable goods spending going forward, while services still have room for rapid growth.
An Inside Look at the GDP Q2 Advance Estimate The chart below is a way to visualize real GDP change since 2007 and uses a stacked column chart to segment the four major components of GDP with a dashed line overlay to show the sum of the four, which is real GDP itself. Here is the latest overview from the Bureau of Labor Statistics:Real gross domestic product (GDP) increased at an annual rate of 6.5 percent in the second quarter of 2021 (table 1), according to the “advance” estimate released by the Bureau of Economic Analy sis. In the first quarter, real GDP increased 6.3 percent (revised). The GDP estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see “Source Data for the Advance Estimate” on page 3). The “second” estimate for the second quarter, based on more complete data, will be released on August 26, 2021.Let’s take a closer look at the contributions of GDP of the four major subcomponents. The data source for this chart is the Excel file accompanying the BEA’s latest GDP news release (see the links in the right column). Specifically, it uses Table 2: Contributions to Percent Change in Real Gross Domestic Product. Here is a chart of the latest estimates. Over the time frame of this chart, the Personal Consumption Expenditures (PCE) component has shown the most consistent correlation with real GDP itself. When PCE has been positive, GDP has usually been positive, and vice versa. In the latest GDP data, the contribution of PCE came at 7.78 of the 6.5 real GDP, an increase from the previous revision. Gross Private Domestic Investment was a positive contributor. Net Exports were negative in Q1. Government Consumption Expenditures also came in as a negative contributor. As for the role of Personal Consumption Expenditures (PCE) in GDP and how it has increased over time, here is a snapshot of the PCE-to-GDP ratio since the inception of quarterly GDP in 1947. To one decimal place, the latest ratio of 70.0% is at its record high and above the levels seen during the last recession.Let’s close with a look at the inverse behavior of three of the GPDI components during recessions. PCE and especially GC generally increase as a percent of GDP whereas GPDI declines. Note the three with different vertical axes (Personal Consumption Expenditures on the left, Gross Private Domestic Investment and Government Consumption on the right) to highlight the frequent inverse correlations.
A Few Comments on Q2 GDP –Earlier from the BEA: Gross Domestic Product, Second Quarter 2021 (Advance Estimate) and Annual UpdateReal gross domestic product (GDP) increased at an annual rate of 6.5 percent in the second quarter of 2021, according to the “advance” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 6.3 percent (revised).On a Q2-over-Q2 basis, GDP was up 16.7% (Q2 2020 was the depth of pandemic recession). This graph shows the percent decline in real GDP from the previous peak (the previous peak was in Q4 2019).This graph is through Q1 2022, and real GDP is now at a new peak; 0.8% above the previous peak.The advance Q2 GDP report, at 6.5% annualized, was below expectations, due to several factors – a decline in private inventories, a decline in residential investment, a decline in government expenditures and a negative contribution from trade.Personal consumption expenditures (PCE) increased at a 11.8% annualized rate in Q2, due, in part, to the American Rescue Plan Act.The second graph below shows the contribution to GDP from residential investment, equipment and software, and nonresidential structures (3 quarter trailing average). This is important to follow because residential investment tends to lead the economy, equipment and software is generally coincident, and nonresidential structure investment trails the economy.In the graph, red is residential, green is equipment and software, and blue is investment in non-residential structures. So the usual pattern – both into and out of recessions is – red, green, blue.Of course – with the sudden economic stop due to COVID-19 – the usual pattern doesn’t apply.The dashed gray line is the contribution from the change in private inventories.Residential investment (RI) decreased at a 9.8% annual rate in Q2. Equipment investment increased at a 13.0% annual rate, and investment in non-residential structures decreased at a 7.0% annual rate (after getting crushed over the previous year).. The contribution to Q2 GDP from investment in private inventories was -1.13 percentage points (this will likely be a positive in the second half of 2021).On a 3 quarter trailing average basis, RI (red) is still up solidly, equipment (green) is up sharply, and nonresidential structures (blue) is still down.The third graph shows residential investment as a percent of GDP.Residential Investment as a percent of GDP decreased in Q2, after increasing sharply for several quarters. I’ll break down Residential Investment into components after the GDP details are released. Note: Residential investment (RI) includes new single family structures, multifamily structures, home improvement, broker’s commissions, and a few minor categories.The fourth graph shows non-residential investment in structures, equipment and “intellectual property products”. Investment in non-residential structures declined in Q2 as a percent GDP, and will probably be weak for some time (hotel occupancy is still low, office and mall vacancy rates are high).
Business Cycle Indicators for End-July 2021 – Consumption, personal income and St. Louis Fed’s real manufacturing and trade industry sales were released today. The July employment situation will be released next Friday. This is the picture today.
- Figure 1: Nonfarm payroll employment from June release (dark blue), Bloomberg consensus as of 7/30 for July nonfarm payroll employment (light blue +), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), consumption in Ch.2012$ (light blue), and monthly GDP in Ch.2012$ (pink), all log normalized to 2020M02=0. NBER defined recession dates shaded gray. Personal income excluding current transfers growth has stalled out. Relative to the NBER peak in 2020M02, employment continues to be the laggard, down 4.5% (log terms). If nonfarm payroll (NFP) in July rises as forecasted by Bloomberg consensus by 900K, it’ll still be down by 3.9%. Manufacturing and trade industry sales declined as suggested by retail sales ex-food services (as noted in this post from mid-July).
- Figure 2: Retail sales excluding food services, in 1982-84$ (teal), manufacturing and trade sales in bn. 2012$ SAAR (black), both in logs, 2020M02=0. Retail sales ex-food deflated using CPI-all. NBER defined recession dates shaded gray. Continued, albeit slower, decline in June is implied (a regression of growth in manufacturing trade sales on growth in retail sales 2019-2021 yields an adjusted-R2 of about 0.84). Retail sales provided little information on the June change in consumption, as shown below.
- Figure 3: Retail sales and food services, in 1982-84$ (teal), consumption, in2012$ SAAR (light blue), both in logs 2020M02=0. Retail sales using CPI-all. NBER defined recession dates shaded gray. The personal income and outlays release also provided information regarding inflation.
- Figure 4: Personal consumption expenditure (PCE) inflation (blue), PCE core inflation (orange), PCE trimmed mean (green), CPI-all inflation (red), all month-on-month annualized. Source: BEA, Dallas Fed, BLS via FRED and author’s calculations.PCE inflation of 6.3% was considerably less than CPI inflation of 11.4% – and less than Chained CPI inflation of 10.9%. That June reading was also less than April’s reading of 7.2%; unfortunately, the trimmed mean inflation rose from 4.8% to 5.7% – so inflationary pressures do exist.The level of the PCE price index has risen and exceeded the trend defined by 2% from January 2020.
- Figure 5: Personal Consumption Expenditure (PCE) price deflator (black), Cleveland Fed nowcast (gray line), WSJ survey mean (teal line), 2015M01-20M01 trend (light blue), 2% trend from 2020M01 (pink), all 2012=100, on log scale. It might not be obvious in the graph, but the 1.1% gap between June actual and trend is the same in absolute value as the -1.1% gap in April and May of 2020.
Seven High Frequency Indicators for the Economy – These indicators are mostly for travel and entertainment. It will interesting to watch these sectors recover as the pandemic subsides. The TSA is providing daily travel numbers. This data is as of July 25th. This data shows the 7-day average of daily total traveler throughput from the TSA for 2019 (Light Blue), 2020 (Blue) and 2021 (Red). The 7-day average is down 21.3% from the same day in 2019 (78.7% of 2019). (Dashed line) The second graph shows the 7-day average of the year-over-year change in diners as tabulated by OpenTable for the US and several selected cities. This data is updated through July 24th, 2021. This data is “a sample of restaurants on the OpenTable network across all channels: online reservations, phone reservations, and walk-ins. Note that this data is for “only the restaurants that have chosen to reopen in a given market”. Since some restaurants have not reopened, the actual year-over-year decline is worse than shown. Dining is generally picking up, but was down 6% in the US (7-day average compared to 2019). Florida and Texas are above 2019 levels. This data shows domestic box office for each week and the median for the years 2016 through 2019 (dashed light blue). The data is from BoxOfficeMojo through July 22nd. Movie ticket sales were at $132 million last week, down about 52% from the median for the week. This graph shows the seasonal pattern for the hotel occupancy rate using the four week average. Occupancy is well above the horrible 2009 levels and weekend occupancy (leisure) has been solid. This data is through July 17th. The occupancy rate is down 8.7% compared to the same week in 2019. Note: Occupancy was up year-over-year, since occupancy declined sharply at the onset of the pandemic. However, the 4-week average occupancy is still down from normal levels. This graph, based on weekly data from the U.S. Energy Information Administration (EIA), shows gasoline supplied compared to the same week of 2019. As of July 16th, gasoline supplied was down 3.9% compared to the same week in 2019. There have been 3 weeks so far this year when gasoline supplied was up compared to the same week in 2019. This graph is from Apple mobility. From Apple: “This data is generated by counting the number of requests made to Apple Maps for directions in select countries/regions, sub-regions, and cities.” There is also some great data on mobility from the Dallas Fed Mobility and Engagement Index. This data is through July 23rd for the United States and several selected cities. According to the Apple data directions requests, public transit in the 7 day average for the US is at 101% of the January 2020 level. Strangely, New York City is doing well by this metric, but subway usage in NYC is down sharply (next graph). I’d put much more weight on subway usage! Here is some interesting data on New York subway usage (HT BR). This graph is from Todd W Schneider. This is weekly data since 2015. Most weeks are between 30 and 35 million entries, and currently there are over 12 million subway turnstile entries per week – and generally increasing.This data is through Friday, July 23rd. Schneider has graphs for each borough, and links to all the data sources.
2-year and 10-year Treasurys in July book largest monthly yield drop since March of 2020 – Data on Friday showed that Fed’s preferred inflation gauge rose sharply in June. Treasury yields ended lower on Friday, with the 2- and 10-year rates notching their biggest one-month drops in over a year, as the Federal Reserve’s preferred inflation gauge rose sharply in June, but by less than forecasters had expected.The session marked the final trading day in July, which has seen long-dated debt yields fall to around five-month lows. Meanwhile, equities finished lower Friday, after hitting record highs earlier this week, amid a spike in new virus cases sparked by the spread of COVID-19’s delta variant (link). The Federal Reserve’s preferred U.S. inflation measure (link) rose sharply again in June and the increase over the past year remained at a 13-year high, raising the cost of living for consumers and casting a shadow over a strong economic recovery.The so-called personal-consumption expenditures index rose 0.5% in June, government figures show. Economists polled by the Wall Street Journal had expected the Commerce Department to report that PCE, a measure of household spending on goods and services, increased 0.7% last month. It was the fourth big upturn in a row and kept the increase over the past 12 months at 4%.A separate measure of inflation that strips out volatile food and energy prices climbed to the highest level since 1992. The core PCE price index rose 0.4% in June, and its increase over the past 12 months crept up to 3.5% from 3.4%. Central bankers regard the core measure as a better indicator of underlying inflation.One Fed official, St. Louis Fed President James Bullard (link), said the central bank should start to slow down its bond purchases this fall and finish by March. He expects GDP growth to be stronger in the second half and some of the surge of inflation this year to last into 2022. In a speech to European Economics and Financial Centre on Friday, Bullard said that he thought financial markets “are very well prepared” for the reduction in purchases.Meanwhile, the most comprehensive gauge of the rise in labor costs decelerated in the second quarter. The employment cost index (link) rose 0.7% in the second quarter, after rising 0.9% in the January-March quarter, the Labor Department said Friday. Economists polled by the Wall Street Journal had forecast a 0.9% increase.In other data released Friday, a measure of business conditions in the Chicago region — known as the Chicago Business Barometer (link) — rose to 73.4 this month from 66.1 in June, showing the area’s economy is surging. And consumer sentiment (link) fell in July as inflation expectations hit the highest level in more than a decade, according to a University of Michigan survey.The data come after a reading of second-quarter U.S. gross domestic grew at a 6.5% annualized rate (link), with consumer spending (link) climbing sharply at an 11.8% annual rate.
The United States suspended its debt ceiling in 2019. That ends this weekend. – The Treasury Department runs into an important deadline this weekend, when a 2019 suspension of the government’s debt limit – known as the debt ceiling – expires Saturday. That forces the Treasury Department to perform what are called “extraordinary measures” so the government can continue paying its obligations as lawmakers prepare to face off over the issue moving forward. The debt ceiling is the amount the Treasury can borrow on behalf of the public. Raising or suspending that borrowing limit does not dictate how much money the government spends, but allows the U.S. to pay what has already been approved. The debt ceiling was suspended in 2019 under President Donald Trump. On Friday, the Treasury Department started taking its “extraordinary measures” ahead of the looming deadline and warned congressional leaders in a recent letter that the Treasury will need to start taking additional steps starting Monday to keep the U.S. from defaulting on its obligations if congressional action was not taken. Treasury Secretary Janet Yellen said failure to meet its obligations would cause “irreparable harm” to the U.S. economy. The U.S. has never defaulted on its debt, a situation unwelcome to lawmakers on both sides of the political aisle. But heading into the weekend, no actions appeared to be on the near horizon to address the issue – but a hard deadline to take action isn’t clear. In addition to its “extraordinary measures,” the Treasury Department said earlier this year it would have $450 billion in cash on hand starting next month. Last week, the Congressional Budget Office estimated the government would probably run out of cash to pay its bills starting this fall, likely in October or November, echoing an early projection by the Bipartisan Policy Center of the so-called “X date” coming some time this fall. But as the U.S. heads toward another deadline, there is the additional uncertainty of the coronavirus, one that has not factored into previous debt limit debates. In the past, raising or suspending the debt ceiling had taken place with bipartisan support. Most recently, the 2019 bill suspending the debt ceiling passed before lawmakers headed out on recess, with a number of Senate Democrats joining Republicans in the majority to pass the bill 67 to 28. Last week, now Senate Minority Leader Mitch McConnell suggested putting a debt limit provision in the $3.5 trillion reconciliation bill Senate Democrats are working on, telling Punchbowl News he doesn’t expect a single Republican to vote to raise it. Senate Majority Leader Chuck Schumer pointed out Democrats joined Republicans three times during the Trump administration to raise the ceiling, calling it “Trump debt.”
GOP sees debt ceiling as its leverage against Biden Senate Republicans plan to demand big spending reforms in exchange for their support of legislation to raise the nation’s debt ceiling, seeking leverage to rein in President Biden’s plan to pump trillions of dollars into the economy. GOP senators are reviving demands they made in 2011, the last time there was a political standoff over raising the debt limit, but it’s a risky move. The 2011 debt limit was solved at the last moment, and a subsequent downgrading of the nation’s creditworthiness by S&P triggered a stock market crash. The issue is coming to a head, as Treasury Secretary Janet Yellen warned Friday that the debt limit will likely have to be raised by the end of September and urged Congress to do so under regular order, which means finding at least 10 Republican votes to support it in the Senate. If Republicans can get spending reforms attached to the debt limit increase, they want to force Democrats to jam debt limit legislation in a budget reconciliation bill that is expected to pass without any GOP support. They don’t want to vote for anything that could give them some shared responsibility for the nation’s $29 trillion debt. But Democrats, who are falling behind schedule on their two-track strategy for passing infrastructure legislation, will have a hard time wrapping up work on a reconciliation package by October. Republican senators are calling for major spending reductions over the next 10 years in exchange for raising the federal government’s borrowing authority. They’re also pushing for the establishment of special commissions to curb the long-term growth of Social Security and Medicare. “I’m all for spending caps, especially on nondefense domestic discretionary spending,” said Senate Republican Whip John Thune (S.D.) when asked about legislation to raise the debt limit. “If they had a realistic way of getting a BCA-type approach to it, that would be great,” he said, referring to the Budget Control Act, which Congress passed in 2011 after a bitter fight over the debt limit. That deal from 10 years ago established discretionary spending limits over a 10-year period as well as automatic across-the-board spending reductions of certain spending programs. “A lot of our guys would like to see the government shutdown [legislation] attached. There’s the Romney Trust bill, which creates a commission to do entitlement reform. There are a number of budget reforms that our members I think would be supportive in the context of a vote on the debt limit,” Thune added. He was referring to legislation sponsored by Sen. Rob Portman (R-Ohio) and other Republicans that would prevent future government shutdowns by creating an automatic continuing resolution to keep federal departments and agencies operating if Congress can’t agree on spending bills.
Biden’s new bill a ‘grab bag’ of social infrastructure | PBS NewsHour (video & transcript) Six months into Biden’s presidency, he’s facing numerous challenges: a resurgence of COVID-19, mainly among the unvaccinated, a nation still highly polarized, and a battle to get both a bipartisan infrastructure bill, and a highly ambitious, democrats-only package of social programs through Congress. First is the bipartisan infrastructure bill that would provide about $600 billion in new money for roads, bridges, rail, rural broadband, so-called hard infrastructure. That’s the bill that a number of Republicans in principle have said they’d like to support. The other one is a much more ambitious $3.5 trillion Democrats only bill that provides for social spending from pre-K to two years of free community college, vastly expanded Medicare for dental and vision services, help for child care, help for seniors. And there’s not a single Republican in the Senate who will support it. So you need every Democrat. And then Kamala Harris is the tiebreaker. So those are the two bills that are that are making their way or not through the process.NewsHour Weekend special correspondent Jeff Greenfield joins from Santa Barbara to discuss.
Infrastructure bill on the rocks, as GOP rejects Dem compromise –Bipartisan infrastructure negotiations have hit another roadblock, as Senate Democrats continue to work on a backup plan for President Biden’s biggest legislative priority.CNN, Bloomberg and Politico were among the outlets reporting that a number of sticking points were outstanding after Republicans rejected a compromise proposal from the White House and Democratic negotiators. The two sides remain at an impasse on a number of issues, including funding for highways versus public transit, questions over broadband internet access and how the bill would be financed.Earlier this month, negotiators from both parties had said they expected this week to deliver the text of the legislation with its final details hammered out. That deadline now seems in peril ahead of the scheduled Aug. 9 recess, when lawmakers are due to return home.Democrats are continuing to attempt a two-track process to appease the ideological breadth of their party. The bipartisan bill that members of both parties have been negotiating for weeks in order to get moderates on board now appears to be in question. That bill would require 60 votes to move forward in the Senate, meaning that at least 10 Republicans would have to support it.The second part of the process would deliver on many of Biden’s campaign promises and White House priorities while appeasing the party’s progressives. A $3.5 trillion bill that included a number of climate measures would then be passed in the Senate through reconciliation, which would require only 50 Democratic votes. With just 50 members of the caucus, any single Democratic or independent senator who decided not to align with the Democrats could sink the bill, meaning that it must win the approval both of progressives like Senate Budget Chairman Bernie Sanders of Vermont and of moderates like Sen. Joe Manchin of West Virginia. In an interview with ABC News on Sunday, House Speaker Nancy Pelosi confirmed her position that she would not take up the bipartisan bill until the reconciliation bill had also passed. She said she was rooting for the infrastructure bill to pass and congratulated Biden and the negotiators on their work, but laid out why the second bill was necessary.”We say build back better with women,” Pelosi said. “That’s why we need childcare. That’s why we need home health care funding. That’s why we need family and medical leave. So building the human infrastructure is really a part of building the physical infrastructure. So that’s why we will have something further to add. The deal is not as green as I would like it to be, the infrastructure bill … but nonetheless, I hope it will pass.”
Infrastructure-Bill Negotiators Try to Overcome Late Hurdles – WSJ – A push to complete a roughly $1 trillion infrastructure agreement hit a series of hurdles Monday, as aides squabbled over funding for water infrastructure and how to apply a requirement that federal contractors pay their employees a locally prevailing wage, among other issues.Lawmakers had previously set Monday as a target for closing out their talks and beginning floor consideration of the emerging agreement, though that timeline seemed to slip as the two sides sniped at each other.Democrats sent Republicans an offer Sunday night to try to resolve the remaining issues, which also include transit funding and repurposing Covid-19 aid for infrastructure, according to a Democratic aide familiar with the talks.Republican aides panned the offer on Monday, accusing Democrats of backtracking on parts of the agreement. Other aides familiar with the talks said negotiators were also still trying to figure out how to cover the cost of the spending with a mix of new revenue and savings measures.The core group of 10 senators who have spent weeks negotiating the details of the agreement – which they first unveiled last month at the White House with President Biden – met again Monday evening. Leaving the meeting, several of the lawmakers said that many of the final issues would be left to the White House counselor Steve Ricchetti and Sen. Rob Portman (R., Ohio). A GOP aide disputed that the negotiations were left to the two men. White House press secretary Jen Psaki cast the flare-up of disagreements in the talks as part of the process toward achieving an agreement. At stake is the fate of both the infrastructure plan – of which about $600 billion would be spending above projected federal levels if current programs continued – and President Biden’s broader goals on Capitol Hill. Top Democrats see the infrastructure bill as the first plank of approving much of Mr. Biden’s $4 trillion agenda and are hoping to follow it with a $3.5 trillion bill that they plan to advance through a budget process that avoids the 60-vote threshold necessary for most legislation in the Senate.Senate Majority Leader Chuck Schumer (D., N.Y.) has said he wants to approve the infrastructure deal and an outline of the $3.5 trillion bill before the Senate is set to leave town next month, creating a tight timetable to make progress on a variety of policy questions. An initial procedural vote on the infrastructure plan failed last week, as Republicans said they were unwilling to support the effort until they had completed the deal’s details. Mr. Schumer said lawmakers could work through the coming weekend to finish up the deal.The dispute around water infrastructure revolved around how to incorporate a $36-billion, Senate-passed water reauthorization bill into the deal, according to aides in both parties. Republicans charged Democrats with suddenly demanding more funds for water infrastructure, while Democrats said Republicans were abandoning a previous understanding on the issue.Negotiations on transit funding continued Monday, as Democrats sought a greater share of funding for public-transit systems than Republicans.
Sen. Joe Manchin on bipartisan infrastructure bill: ‘everything could fall apart’ if it fails — Sen. Joe Manchin (D-W.Va.) put his Democratic colleagues on notice Monday night, predicting they would not be able to pass a massive $3.5 trillion spending plan if attempts to piece together a bipartisan $1.2 trillion infrastructure fail.”I would say that if a bipartisan infrastructure bill falls apart, everything could fall apart,” Manchin told reporters. ” … Both of them are extremely important, but [if] one falls apart, how do you do the other one? How’s the other one become more important?”Lawmakers from both parties have struggled to iron out the final details of the $1.2 trillion package, the framework of which was announced by President Biden last month. Senators involved in negotiations had hoped to have a final bill completed early this week after Senate Republicans blocked a procedural vote last week on the unfinished legislation.Earlier Monday, Senate Majority Leader Chuck Schumer (D-NY) threatened to make senators work through this weekend to put a bill on the floor for a vote. “We have reached a critical moment,” Schumer said on the Senate floor. “The bipartisan group of Senators has had nearly five weeks of negotiations since they first announced an agreement with President Biden. It’s time for everyone to get to ‘yes’ and produce an outcome for the American people.”
infrastructure talks leave Biden’s entire agenda at risk — (AP) – President Joe Biden’s latest leap into the Senate’s up-and-down efforts to clinch a bipartisan $1 trillion infrastructure deal comes with even more at stake than his coveted plans for boosting road, rail and other public works projects. The outcome of the infrastructure bargaining, which for weeks has encountered one snag after another, will impact what could be the crown jewel of his legacy. That would be his hopes for a subsequent $3.5 trillion federal infusion for families’ education and health care costs, a Medicare expansion and efforts to curb climate change. Biden and Senate Majority Leader Chuck Schumer, D-N.Y., will need support from every Democratic moderate and progressive to push the $3.5 trillion bill through the 50-50 Senate, with Vice President Kamala Harris’ tie-breaking vote. If the infrastructure talks implode, it may be harder for moderates – who rank its projects as their top priority – to back the follow-up $3.5 trillion plan, which is already making them wince because of its price tag and likely tax boosts on the wealthy and corporations. “I would say that if the bipartisan infrastructure bill falls apart, everything falls apart,” West Virginia Sen. Joe Manchin, one of his chamber’s most conservative Democrats, warned reporters this week. That could well prove an overstatement, since moderates like him will face enormous pressure from Biden, Schumer and others to back the $3.5 trillion package, whatever the bipartisan plan’s fate. But it illustrates a balancing act between centrists and progressives that top Democrats must confront. “If infrastructure collapses, which I hope it does not, you’d have the difficulty of holding some of the Democrats” to back the $3.5 trillion bill, No. 2 House leader Steny Hoyer, D-Md., said Tuesday in a brief interview. Party leaders will be able to lose no more than three Democrats to prevail in the 435-member House. Both sides in the talks were expressing renewed optimism Tuesday about prospects for a deal, a view they’ve expressed before without producing results. The uncertainty underscored that Democrats were at a promising yet precarious point for their agenda, with stakes that seem too big for them to fail yet failure still possible.
In 67-32 Vote, Bipartisan Infrastructure Deal Advances To Debate In The Senate – With 17 Republicans joining all 50 Democrats, the Senate on Wednesday voted to advance debate on a broad infrastructure package, just hours after a bipartisan group of senators and Joe Biden reached accord on a $550 billion plan that is a major step forward for the White House’s economic agenda. Below is a list of the key republicans who joined the Democrats to pass the vote:While the 67-32 procedural vote doesn’t guarantee that the package of spending on physical infrastructure will pass the Senate, but is a good indication that it may have enough support. Lawmakers expect votes on amendments and final passage to last into the weekend and possibly next week, with an eye to salvaging a long recess set to begin Aug. 9.The Senate will convene at 10:30 AM tomorrow. Following the conclusion of Morning Business, the Senate will resume consideration of the Motion to Proceed to H.R. 3684 (the legislative vehicle for the bipartisan infrastructure bill), post-clotureAs noted earlier, a core group led by Republican Senator Rob Portman of Ohio and Democratic Senator Kyrsten Sinema of Arizona hammered out the infrastructure deal after lawmakers failed to muster the votes to begin debate last week.”Our plan will create good-paying jobs in communities across our country without raising taxes. Reaching this agreement was no easy task – but our constituents expect us to put in the hard work and show that two parties can still work together to address the needs of the American people,” the group of nine Republicans, 10 Democrats and one independent said in a statement.Among the projects that would get money, according to the White House:
- $110 billion for roads, bridges and major projects
- $73 billion for electric grid upgrades
- $66 billion for rail and Amtrak improvements
- $65 billion for broadband expansion
- $55 billion for clean drinking water
- $39 billion for transit
- $17 billion for ports and $25 billion for airports
- $7.5 billion for electric vehicle chargers
“This deal signals to the world that our democracy can function, deliver, and do big things,” Biden said in a statement. It “will help ensure that America can compete in the global economy just when we are in a race with China and the rest of the world for the 21st century.”But several Republicans, including Rick Scott of Florida and Ted Cruz of Texas, blasted the overall price tag and said they would oppose the bill.”Congress can’t keep spending trillions of dollars we don’t have,” the senators said in a statement. “The infrastructure package announced today continues the trend in Congress of insane deficit spending.”The package would be paid for by measures like re-purposing $200 billion in unspent Covid-19 relief funds, sales from the Strategic Petroleum reserve, increased customs user fees, government-sponsored enterprise fees and increased reporting requirements on cryptocurrency transactions. It also uses some funding sources that are sometimes called gimmicks, like counting revenue from future economic growth, extending cuts to future Medicare spending that Congress regularly turns off and allowing companiesIf the Senate is able to pass the bill in the coming days, Democrats hope to quickly pivot to passing a budget for fiscal 2022 which would set up a fast-track process to enact much of the rest of Biden’s economic agenda without any Republican support.
Sen. Kyrsten Sinema won’t back Democrats’ $3.5T reconciliation bill – Sen. Kyrsten Sinema does not support Democrats’ $3.5 trillion budget plan that aims to deliver major components of President Joe Biden’s economic agenda that Democrats hope to pass after moving a separate bipartisan infrastructure deal that Sinema negotiated.Sinema, D-Ariz., told The Arizona Republic on Wednesday she had reviewed the Senate Budget Committee’s spending framework and has told Senate leadership and Biden that she supports many of its goals, including job growth and American competitiveness. “I have also made clear that while I will support beginning this process, I do not support a bill that costs $3.5 trillion – and in the coming months, I will work in good faith to develop this legislation with my colleagues and the administration to strengthen Arizona’s economy and help Arizona’s everyday families get ahead,” Sinema said in a written statement.Sinema’s reservations with the overall budget bill, along with those of Sen. Joe Manchin, D-W.Va., suggests Democrats won’t have the votes to pass the more expansive plan, forcing Democrats to scale back the bill. All Senate Democrats would have to vote for the budget reconciliation bill for it to pass in the 50-50 chamber, where Vice President Kamala Harris would deliver a vote to break a tie. The package is a crucial component of Biden’s “human infrastructure” agenda that includes expanding Medicare and caregiving for the disabled and elderly, funding universal pre-kindergarten and paying for climate change initiatives. Sen. Mark Kelly, D-Ariz., also wants to advance the vehicle to get the process started on the budget reconciliation package, he said in a statement to The Republic. He did not commit support to the top-line $3.5 trillion price tag. “A lot of work remains to continue rebuilding and growing our economy, which is why I want to see us move forward with this budget process,” Kelly said. “I look forward to continuing to work on the details to make sure we create more good-paying jobs and get Arizonans the skills they need to work them.”Sinema’s position on the price tag drew swift condemnation from progressive House Democrats and activists already incensed with her stance on maintaining the legislative filibuster. The filibuster is an obstacle to swiftly advancing Democrats’ agenda ahead of the 2022 midterm elections. Rep. Alexandria Ocasio-Cortez, D-N.Y., tweeted to her 12.7 million followers: “Good luck tanking your own party’s investment on childcare, climate action, and infrastructure while presuming you’ll survive a 3 vote House margin.” Rep. Rashida Tlaib, D-Mich. meanwhile, accused Sinema of not caring about Arizona floods, wildfires across the West and aging infrastructure.”Sinema is more interested in gaining GOP friends and blocking much needed resources, than fighting for her residents’ future,” Tlaib wrote on Twitter. Sinema’s position on the budget reconciliation bill comes the same day she and Sen. Rob Portman, R-Ohio, announced a major breakthrough on a separate $1.2 trillion bipartisan public works infrastructure plan. Later in the day, senators voted 67-32 to begin debate on that infrastructure bill. Seventeen Republicans joined with Democrats to advance the legislation. That effort would remake the nation’s roads, bridges, airports, transit and water systems, and other projects.
Infrastructure deal is a mirage of hope in a poisoned Congress – For the briefest moment, amid an inferno of fury, mistrust, stunts and ill-faith, Congress actually worked.The Senate vote Wednesday on a bipartisan infrastructure deal was merely on opening debate on the plan, with legislative text yet to be released. But such tiny breakthroughs in Capitol Hill stalemate pass for huge success in a body that reflects, and now actively deepens, America’s bitter national estrangement.The bill — based on a still fragile compromise wrought in weeks of talks — is a critical plank of Joe Biden’s presidency as he seeks to show Americans that flailing, politicized Washington can still fix big things. In a treacherous path toward passage, the measure could still be derailed by Republicans intimidated by former President Donald Trump, who issued a vague threat of 2022 primaries against Republicans if the deal happened. It also needs the courage of more moderate GOP senators to survive, as the demands of progressive House Democrats threaten to blow it up. While more than $1 trillion for roads and bridges and other physical infrastructure represents a critical investment, the symbolism of Wednesday’s vote is more important. The President hopes it will validate the parable of his inaugural address – that “politics need not be a raging fire destroying everything in its path.”Sadly, most current evidence suggests the opposite in a Congress consumed by its poisoned antagonism, where traditional ideological fractures are exacerbated by the trauma of the January 6 insurrection and the stress of the pandemic.On Wednesday alone, Republican Rep. Lauren Boebert of Colorado reportedly threw a maskback at a floor staffer who offered her one so that she could comply with the reinstatement of masking requirements, announced by the Capitol attending physician late Tuesday in light of new US Centers for Disease Control and Prevention guidance amid rising case numbers across the country.And House Speaker Nancy Pelosi is hardly maintaining the decorum expected of an office that is second in line to succeed the President. She described Minority Leader Kevin McCarthy as “such a moron.” She was frustrated that her fellow Californian is leading his conference on a made-for-Fox-News crusade against masking guidelines with the kind of zeal that might be better employed urging Republican voters to get vaccinated. McCarthy had earlier turned masking into another culture war battle by accusing liberals of wanting “a perpetual pandemic state.”The modern House has featured some combustible political characters. But relations between the two leaders of the rival parties have never been this toxic in living memory.
U.S. Senate in rare Saturday session on $1 trln infrastructure bill (Reuters) -The U.S. Senate in a rare Saturday session worked on a bill that would spend $1 trillion on roads, rail lines and other infrastructure, as lawmakers from both parties sought to advance President Joe Biden’s top legislative priority. The ambitious plan has the backing of Democrats and Republicans alike and has already cleared two hurdles by broad margins in the closely divided Senate. But so far no lawmakers have seen the final text of the bill, which includes about $550 billion in new spending and was still being written on Saturday. Earlier votes were for a shell bill that the actual legislation will be added to once it is complete. “Once the bipartisan group completes the legislative text, I will offer it as a substitute amendment,” top Senate Democrat Chuck Schumer said on Saturday. The Senate is going to move forward on both tracks of infrastructure before the beginning of the August recess. The longer it takes to finish, the longer we’ll be here. But we’re going to get the job done.” After passing the $1 trillion bill, Schumer aims to push forward on a sweeping $3.5 trillion package that focuses on climate change and home care for the elderly and children. That faces staunch Republican opposition and some dissent among moderate Democrats. The Senate voted 66-28 on Friday to take up the bill, with 16 Republicans joining all 48 Democrats and two independents in support. The package would dramatically increase the nation’s spending on roads, bridges, transit and airports. Supporters predicted it will ultimately pass the Senate and House of Representatives, eventually reaching Biden’s desk for him to sign it into law. It includes about $550 billion in new spending, on top of $450 billion that was previously approved. It also includes money for eliminating lead water pipes and building electric vehicle charging stations. The bill does not include funding for most climate change and social initiatives that Democrats aim to pass in the separate $3.5 trillion measure without Republican support. Democrats hold razor-thin margins in both the Senate and the House of Representatives, meaning the party must stick together to achieve its legislative goals. Progressive members of the House Democratic caucus have already suggested the $1 trillion package is inadequate, and the Senate could likewise impose changes that could complicate its chances of becoming law. But supporters, including Schumer and Republican Senate Leader Mitch McConnell, have been optimistic about its prospects.
COVID-19 surge explodes Biden’s claim of “independence” from pandemic – On July 4, President Joe Biden gave a speech in which he effectively asserted that the COVID-19 pandemic was over in America. Biden said the United States was “declaring our independence from a deadly virus … We can live our lives, our kids can go back to school, our economy is roaring back.” It was a theme Biden has repeated in speech after speech. On May 13, he said America was nearing the “finish line” of the pandemic. On June 15, he said: “America is headed into the summer dramatically different from last year’s summer: a summer of freedom, a summer of joy, a summer of get-togethers and celebrations. An all-American summer that this country deserves after a long, long, dark winter that we’ve all endured.” In reality, since Biden’s announcement of “independence” from COVID-19, cases have surged seven-fold and hospitalizations and deaths are rising as the dangerous Delta variant of the disease has become dominant. In the epicenters of the current pandemic outbreak – Arkansas, Louisiana and Florida – cases are at the highest level since January and are on track to set new records. Throughout 2020, then-President Donald Trump repeatedly claimed that the pandemic would “disappear.” Trump’s lies were aimed at eliminating all social distancing measures that had been imposed to contain the spread of COVID-19, with the aim of getting workers back on the job to increase the profits of the financial oligarchy. Biden’s lying declarations of “independence” from the pandemic had the same aim: to justify the abandonment of restrictions on the spread of COVID-19. “Take your mask off. You’ve earned the right,” Biden declared in May. And just as Trump’s insistence on reopening businesses and schools fueled a massive resurgence of the pandemic, the Biden administration’s encouragement of Americans to abandon mask-wearing and social distancing has fueled what may become the greatest outbreak of the pandemic to date. “Almost the same number of cases were reported today (70,264) as this day last year (71,600),” stated Caitlin Rivers, an epidemiologist at Johns Hopkins University on Sunday. But the worst is yet to come. Last Wednesday, the COVID-19 Scenario Modeling Hub, a consortium of researchers working in consultation with the Centers for Disease Control and Prevention (CDC), released a model showing that the number of daily US COVID-19 deaths could surge to 4,000 by October – the highest level of any period of the pandemic.
Rising case count reignites debate over COVID-19 restrictions –Biden administration officials are discussing the potential for tougher guidelines to blunt the nationwide surge in COVID-19 cases, but the White House will have to weigh how new measures might affect its overall vaccination push. The rise in infections around the country has sparked calls from some health experts to reimpose stricter masking guidance and other efforts designed to slow the spread of the virus. Doing so would likely set off criticism from conservatives and spark enforcement issues, as some Republican governors have vowed not to return to restrictions on businesses. White House officials – wary of any appearance that they are politicizing health guidelines – have been adamant that the Centers for Disease Control and Prevention (CDC) will have the final say on whether new guidance is needed. “It would be actually surprising and odd if our health and medical experts were not having an active discussion about how to best protect the American people. And there is of course an active discussion about a range of steps that can be taken, as there has been from the first day of this administration,” White House press secretary Jen Psaki said Monday. “Certainly the surge in cases among the unvaccinated because of the delta variant prompts even more discussion about what actions can be taken,” Psaki added. “But we are going to, the CDC looks at data, they look at data across the country … and if they make an assessment, we will of course be here to follow their guidance.” Anthony Fauci, President Biden’s top medical adviser on the pandemic, told CNN on Sunday that recommending vaccinated Americans resume wearing masks in some settings is “under active consideration.” Fauci and other medical experts are part of those discussions, with Biden receiving regular briefings. Asked Monday if the president supports restrictions for unvaccinated people in public settings like restaurants and museums, Psaki reiterated that the White House will follow the CDC’s lead. But some localities aren’t waiting to take their cues from Washington. Los Angeles County and St. Louis recently announced new mask mandates, even for vaccinated individuals who are indoors. New Orleans issued an advisory encouraging the use of masks when indoors, and several other municipalities have gone a similar route.
The C.D.C. tells Americans to avoid travel to Spain and Portugal as cases rise. The C.D.C. on Monday published a “Level 4” travel notice – the highest warning it issues – saying those who must travel to either country should make sure they are fully vaccinated. Still, the agency said, “even fully vaccinated travelers may be at risk for getting and spreading Covid-19 variants.”Spain and Portugal just reopened their borders to American tourists in June and have been counting on a pent-up demand for their destinations to help fuel an economic recovery.Over the past two weeks, there has been a 74 percent increase in new coronavirus cases in Spain, and a rise of 18 percent in Portugal, according to New York Times data.The C.D.C. also updated Level 4 travel notices on Monday for Cuba,Cyprus and Kyrgyzstan.Last week, the C.D.C. also put out a similar travel notice for theUnited Kingdom, where restrictions have been lifted entirely and new cases have also been on the rise.To travel from the United States to Spain, there is no requirement to bring proof of vaccination or a negative coronavirus test. To travel from the United States to Portugal, tourists must provide proof of a negative coronavirus test. Restrictions on travel from Europe and other parts of the world to the United States will remain in place. On Monday, the Biden administration said those rules would continue, citing concerns that infected travelers may contribute to further spread of the contagious Delta variant across the country, Jen Psaki, the White House press secretary, said Monday afternoon.
The White House will continue to impose travel bans, citing Delta variant concerns. – The Biden administration will continue to restrict the entry of Europeans and others into the United States, citing concerns that infected travelers may contribute to further spread of the contagious Delta variant across the country, Jen Psaki, the White House press secretary, said Monday afternoon.Concern about the variant had convinced officials not to lift the current travel restrictions on foreigners, Ms. Psaki said, some of which had been in place since the beginning of the pandemic. Vaccines remain effective against the worst outcomes of Covid-19, including from the Delta variant.”The more transmissible Delta variant is spreading both here and around the world,” she told reporters, adding that cases are rising in the United States, particularly among the unvaccinated.The decision is a blow to the travel industry, which hoped that a lifting of the travel bans could increase tourism for the remaining summer months, helping hotels, airlines and other businesses that have been struggling.But Ms. Psaki said that it was unclear when the United States would remove the bans completely.”I don’t have a timeline to predict for you because it’s all about what success we have at getting more people vaccinated, getting more vaccines out to the world and fighting the virus,” she said.The United States began restricting travel from foreigners in January 2020, when former President Donald J. Trump restricted some travel from China in the hopes of preventing the spread of the virus. That effort largely failed.But health officials pressed the Trump administration to expand travel bans to much of Europe during the first surge of the pandemic in the spring of 2020, and more countries have been added to the ban as the original virus and several variants have spread rapidly from country to country.The Trump administration also used a public health authority known as Title 42 to effectively shut down the southern border to entry, citing worries that immigrants crossing on foot could bring the virus into the country. The Biden administration stopped enforcing the rule for unaccompanied children crossing the border alone and for some families.But Ms. Psaki said that the Title 42 restrictions, like the other travel bans, would remain for the time being.”We have never conveyed or announced a timeline for Title 42,” she said. “So nothing has changed in that regard, it remains in place, and it will remain in place as long as that is the guidance from our health and medical experts.”
The Biden administration is considering mandating federal workers to be vaccinated or face testing. – The Biden administration is considering requiring all federal employees to be vaccinated against the coronavirus or be forced to submit to regular testing, social distancing, mask requirements and restrictions on most travel, officials said Tuesday – a dramatic shift in approach by President Biden that reflects the government’s growing concern about the spread of the highly contagious Delta variant. Mr. Biden said on Tuesday that a vaccine mandate for all federal workers is under consideration, but did not provide details. Administration officials said the idea being debated was similar to a plan announced by New York City, which would require any of the city’s 300,000 employees who refuse to be vaccinated to submit to weekly testing. Officials said there was no consideration of simply firing employees who refuse to get vaccinated, but that the government could add additional burdens or restrictions on those who do not get the protections in an effort to convince more people to get the shot in the first place. They said there is evidence that making life inconvenient for those who refuse the vaccine works reasonably well to increase vaccination rates. Around the country, mayors, business leaders, hospital administrators and college presidents are requiring Covid-19 vaccinations, even for those who have refused to voluntarily roll up their sleeves. So far, Mr. Biden has resisted. He has not yet required all federal workers to be vaccinated. He has not ordered members of the military to get shots. And he has not used his bully pulpit call for a broader use of vaccine mandates. But the president’s stance may be shifting quickly. Inside the West Wing, his top public health experts are furiously debating the right path forward, according to administration officials, as the Delta variant surges in places where there are high numbers of unvaccinated Americans, posing a special threat to children, older people, cancer patients and others with weakened immune systems.
CDC Director Hints At ‘Health Passes’, Warns COVID May Be “Few Mutations” Away From Evading Vaccines -Centers for Disease Control and Prevention (CDC) Director Dr. Rochelle Walensky told reporters during a teleconference on Tuesday that her biggest concern is that the CCP virus may be “just a few mutations” away from being able to evade vaccines.“The largest concern that I think we in public health and science are worried about is that virus and the potential mutations. We have a very transmissible virus which as the potential to evade our vaccines in terms of how it protects us from severe disease and death,” Walensky said.”Right now, fortunately, we are not there. These vaccines operate really well in protecting us from severe disease and death. But the big concern is the next variant that might emerge, just a few mutations potentially away, could potentially evade our vaccines.”[ZH: Remember just a few weeks before she lifted the mask mandate, Walensky warned the world of a sense of “impending doom.”] Walensky advised that the threat of a variant that is immune to the current vaccines is the reason more Americans should be vaccinated in a bid to contain the virus and its mutations.
‘Long Covid’ patients will be covered by federal disability law, Biden says. – Americans suffering from “long Covid” – a term referring to new or ongoing health problems from a coronavirus infection that occurred weeks or months ago – will have access to the benefits and protection provided under federal disability law, President Biden said on Monday.Speaking in the Rose Garden to celebrate the 31st anniversary of the Americans with Disabilities Act, Mr. Biden listed some of the lingering effects that have been seen in coronavirus survivors, including “breathing problems, brain fog, chronic pain or fatigue,” and noted that the effects sometimes rise to the level of a disability.“We are bringing agencies together to make sure Americans with long Covid, who have a disability, have access to the rights and resources that are due under the disability law,” Mr. Biden said, noting that they would include special accommodations and services in the workplace, in schools and in the health care system.In some cases, the health effects of Covid-19 can persist for months after initially causing only mild symptoms. A study published in April found that a coronavirus infection also appears to increase the risk of death and chronic medical conditions afterward, even in people who were never sick enough with the virus to be hospitalized. The research, based on records of patients in the Department of Veterans Affairs health system, also found that non-hospitalized Covid survivors had a 20 percent greater chance of needing outpatient medical care in the six months following infection than did people who had not contracted the coronavirus.
Mayorkas working remotely after being exposed to COVID-19 -Homeland Security Secretary Alejandro Mayorkas will be working from home this week after coming into contact with someone who tested positive for the coronavirus and submitting himself to quarantine. “Secretary Mayorkas has a virtual schedule this week after coming into close contact with a DHS official who later tested positive for COVID-19,” Department of Homeland Security (DHS) spokesperson Marsha Espinosa said in a statement to The Hill on Tuesday.”The Secretary is fully vaccinated, has no symptoms, and has tested negative twice. Official DHS contact tracing is underway. These recommendations have been informed by the Office of the DHS Chief Medical Officer and are taken in an overabundance of caution,” Espinosa added.
Pentagon requires masks indoors regardless of vax status – The US military has fallen in line with the latest Centers for Disease Control and Prevention (CDC) recommendations about mask-wearing.The Pentagon announced Wednesday that service members, civilian workers, contractors and visitors must wear masks indoors at military installations and other facilities “owned, leased or otherwise controlled” by the Defense Department in areas where COVID-19 transmission is “substantial” or “high.”The memo from Deputy Secretary of Defense Kathleen Hicks also requires those who are not fully vaccinated to practice social distancing.The Pentagon directive follows Tuesday’s CDC recommendation of indoor mask mandates in jurisdictions with at least 50 confirmed cases of COVID-19 per 100,000 people over the previous seven days.According to the CDC’s own data, approximately two-thirds of America’s counties are experiencing “substantial” or “high” levels of transmission. Nearly half of all US counties fall into the latter category, defined as at least 100 cases per 100,000 people over the past seven days.Coronavirus cases have increased across the US due to the highly contagious Delta variant, which is responsible for the vast majority of infections in the country. The US Navy announced Wednesday that a reservist based in Idaho died Monday and a doctor assigned to the Naval Medical Center at Camp Lejeune, N.C., died last Friday. The deaths of 47-year-old Master-at-Arms First Class Allen Hillman and 48-year-old Capt. Corby Ropp bring the total number of sailors who perished from COVID-19 to 10 and are the first for the Navy since April 29.
CDC Reversal on Masks, Vaccinated as Covid Spreaders, While Boosters Look to Be Coming Late and Not Hugely Effective – Yves Smith The Covid situation has developed not necessarily to the CDC’s advantage. Let us count some of the ways before we turn to a new failure in the making, the vaccine boosters. The CDC left public health officials in the dark during the crucial early months by botching its Covid test and then having trouble with assuring adequate supplies, and stonewalling its own responsibility (the first story was that contractors were to blame, but after months of reporting, it turned out that CDC scientists were)The CDC refused to recommend putting teeth in quarantinesCDC chief Rochelle Walensky said “Vaccinated people do not carry the virus,” as did some public service commercialsThe VAERS database is not only weeks behind in reporting cases of vaccine incidents, but multiple clinicians have submitted adverse events that are almost impossible to attribute to anything else that have not been included in VAERSThe CDC doggedly refusing to acknowledge aerosol transmission and continuing to recommend surface cleaning theater long after the careful and paradigm-shifting work of epidemiologists and aerosol scientists came up with a more convincing and complete theoryWalensky made a fool of herself by crying about how awful things were going to get, and later saying before Congress that her son wasn’t going to camp as the CDC had already finished its “Mission accomplished! Throw off your masks” guidance. Now the CDC has done yet another flip-flop which only further undermines its and the medical establishment’s credibility. The lead item on national TV news this evening was conceding that vaccinated people could (as in are) spreading Covid and they should therefore mask indoors. Oh, but only where the horse has left the barn and is in the next county. As Lambert said in Water Cooler, quoting a Reuters recap:“The recommendations to wear masks in some indoor settings will apply in areas with surging COVID-19 cases, they said.” Awesome. Let’s mask up only after it’s too late. As I keep asking: What business is the CDC in, anyhow?The only goal we can fathom was that Biden was determined to have his July 4 “Freedom Day” whether or not that made any sense in light of vaccination levels and and variant infectiousness. And as Lambert and I have repeatedly bemoaned, treating unmasking as a reward doubled down on right wing messaging that masking was a horrible imposition. Help me. Bathing daily is much more hassle. Do you hear people whine about that?
The Biden administration wants states and cities to pay people $100 to get vaccinated. – The Biden administration is calling on states, territories and local governments to pay $100 to Americans who remain unvaccinated against the coronavirus to get their shots. The move comes as concern has grown about rising cases across the country, and the administration has shifted its strategy to focus on more personalized approaches. The Treasury Department said Thursday that the money to pay for the vaccine incentive payments could come from the $350 billion of relief funds that is being given to states and cities as part of the economic rescue package that Congress approved in March. The incentive is intended to “boost vaccination rates, protect communities, and save lives.” The administration is also stepping up efforts to get to companies to give their employees time off to get the vaccine. The Treasury Department and the Internal Revenue Service said that employers can claim tax credits to cover wages paid to workers who take family members to get vaccinated or care for members of their households who are recovering from the vaccination. Self-employed workers are also eligible to receive the tax credits. The initiative expands on a program that was rolled out in April that offered a paid leave tax credit to offset the cost to companies with fewer than 500 workers incurred by giving paid time to workers getting vaccines. President Biden on Thursday announced that all civilian federal employees must be vaccinated or be forced to submit to regular testing, social distancing, mask requirements and restrictions on most travel. The president also directed the Defense Department to study how and when to add the coronavirus vaccine to the list of required vaccinations for all members of the military. The Biden administration has been tussling with some states over how the relief money can be used, but earlier this year issued guidance that made clear it can go toward programs that are expected to increase the number of people who choose to get vaccinated. The Treasury Department said it will provide technical assistance for states and cities to help them use the money to boost vaccinations in their communities and it will be working with the Department of Health and Human Services. States and cities have been taking creative approaches, such as lotteries, to encourage people to get vaccinated. Some experts, especially in the early days of the vaccination campaign, have expressed concern, though, over the idea of paying people to get vaccinated, worrying that it could be perceived as out of step with messaging that vaccines bring enormous benefits on their own. Opponents of the idea have also questioned whether paying people is the best use of funds to encourage people to get vaccinated.
House Democrats expand probe into political interference into CDC during Trump administration –House Democrats on Monday widened their investigation into political interference at the Centers for Disease Control and Prevention (CDC) during former President Trump’s administration based on new documents. Through letters, Democrats on the House Select Subcommittee on the Coronavirus Crisis requested interviews from eight former and current CDC and Department of Health and Human Services (HHS) officials and employees and three former Trump appointees as the probe branches out. Along with the letters, the subcommittee also released a new email suggesting that senior officials were informed of and planning to discuss how to respond to Trump adviser Paul Alexander’s email requesting an “immediate stop” to all of the CDC’s Morbidity and Mortality Weekly Reports (MMWR). The subcommittee, led by Chairman James Clyburn (D-S.C.), has been looking into reports and emails indicating that Trump appointees tried to meddle in the CDC’s coronavirus response, including through efforts to edit and stop scientific reports on COVID-19. The Trump administration has denied that any political influence affected the reports, traditionally considered to be untouched by politics. A CDC career employee sent the newly released email from Aug. 9 that indicated senior leadership was available to meet and talk about “next steps” following Alexander’s request to halt publication of the MMWR. On Monday, House Democrats asked for interviews with former CDC Deputy Director Anne Schuchat and former CDC official Nancy Messonnier, who held different positions during the pandemic and resigned earlier this year. Former Trump appointees to the CDC Kyle McGowan, Amanda Campbell and Nina Witkofsky were also requested for interviews.
The Vaccine Aristocrats by Matt Taibbi – Covid-19 cases are rising, but the “Pandemic of the Unvaccinated” blame-game campaign is the worst way to address the problem On This Week With George Stephanopoulos this past Sunday, a bafflegab of Washington poo-bahs including Chris Christie, Rahm Emmanuel, Margaret Hoover, and Donna Brazile – Stephanopoulos calls the segment his “Powerhouse Roundtable,” which to my ear sounds like a Denny’s breakfast sampler, but I guess he couldn’t name it Four Hated Windbags – discussed vaccine holdouts. The former George W. Bush and Giuliani aide Hoover said it was time to stop playing nice: If you’re going to get government-provided health care, if you’re getting VA treatment, Medicare, Medicaid, Social Security, anything – and Social Security obviously isn’t health care – you should be getting the vaccine. Okay? Because weare going to have to take care of you on the back end. Brazile nodded sagely, but Emmanuel all but gushed cartoon hearts. “You know, I’m having an out of body experience, because I agree with you,” said Obama’s former hatchet man, before adding, over the chyron, FRUSTRATION MOUNTS WITH UNVACCINATED AMERICANS: I would close the space in. Meaning if you want to participate in X or Y activity, you gotta show you’re vaccinated. So it becomes a reward-punishment type system, and you make your own calculation. This bipartisan love-in took place a few days after David Frum, famed Bush speechwriter and creator of the “Axis of Evil” slogan, wrote a column in The Atlanticentitled “Vaccinated America Has Had Enough.” In it, Frum wondered: Does Biden’s America have a breaking point? Biden’s America produces 70 percent of the country’s wealth – and then sees that wealth transferred to support Trump’s America. Which is fine; that’s what citizens of one nation do for one another … [But] the reciprocal part of the bargain is not being upheld … Will Blue America ever decide it’s had enough of being put medically at risk by people and places whose bills it pays? Check yourself. Have you? I’m vaccinated. I think people should be vaccinated. But this latest moral mania – and make no mistake about it, the “pandemic of the unvaccinated” PR campaign is the latest in a ceaseless series of such manias, dating back to late 2016 – lays bare everything that’s abhorrent and nonsensical in modern American politics, beginning with the no-longer-disguised aristocratic mien of the Washington consensus. If you want to convince people to get a vaccine, pretty much the worst way to go about it is a massive blame campaign, delivered by sneering bluenoses who have a richly deserved credibility problem with large chunks of the population, and now insist they’re owed financially besides. There’s always been a contingent in American society that believes people who pay more taxes should get more say, or “more votes,” as Joseph Heller’s hilarious Texan put it. It’s a conceit that cut across party. You hear it from the bank CEO who thinks America should thank him for the pleasure of kissing his ass with a bailout, but just as quickly from the suburban wine Mom who can’t believe the ingratitude of the nanny who asks for a day off. Doesn’t she know who’s paying the bills? The delusion can run so deep that people like Margaret Hoover can talk themselves into the idea that Social Security – money taxpayers lend the government, not the other way around – is actually a gift from the check-writing class.
Iowa governor suggests immigrants partially to blame for rising COVID-19 cases -Iowa Gov. Kim Reynolds (R) on Tuesday placed partial blame for the recent surge in COVID-19 cases on immigrants crossing into the U.S. from its southern border.”Part of the problem is the southern border is open and we’ve got 88 countries that are coming across the border and they don’t have vaccines so none of them are vaccinated and they’re getting dispersed throughout the country,” Reynolds said to reporters, according to the Des Moines Register. The Register notes that Reynolds has been a vocal critic of President Biden‘s handling of the U.S.-Mexico border. She recently sent 29 state troopers to the southern border at the request of Texas.Health experts have largely attributed to the recent surge in cases to the more infectious delta variant, which has now become the dominant strain in the U.S. The surge has also been dubbed the “outbreak of the unvaccinated” as people who are not immunized against COVID-19 have been disproportionately affected by this recent surge. Joe Henry, state political director for the League of United Latin American Citizens of Iowa, said to the Register that Reynold’s comments amounted to “hate-mongering.” “For her to cry wolf about this doesn’t seem to make sense in light of the fact that she hasn’t done the work here in Iowa to make sure that everybody gets vaccinated,” Henry said.
Biden’s Border Patrol Dumping COVID-Positive Illegals In Texas Town Via Local Charity –Police in La Joya, Texas are reporting that illegal immigrants who have tested positive for Covid-19 are being released from federal custody and into the hands of a Catholic charity – which then dumps them in local hotels without notice. “On July 26, 2021, a La Joya Police Department Officer was waved down by a concern citizen at the Whataburger,” according to a Facebook post by the La Joya PD. “The citizen explained to the Officer that she had observed a family group who were not being observant of proper health guidelines. She stated that the family was coughing and sneezing without covering their mouths and were not wearing face masks.” “The Officer approached the family and was told by them that they had been apprehended by Border Patrol days prior and were released because they were sick with Covid-19,” the post continues. “It was also learned that the family was housed at the Texas Inn Hotel located at 612 E. Expressway 83 La Joya Tx. 78560, by a charity group. Officers made contact with Hotel management who explained that Catholic Charities of The Rio Grande Valley had booked all the rooms in the hotel to house undocumented immigrants that were detained By Border Patrol.” The executive director of the charity confirmed that they are placing illegal migrants infected with COVID into hotels, but that the incident has been “corrected” and a security guard will keep migrants inside the hotel.
Pandemic Aid Programs Spur a Record Drop in Poverty – The huge increase in government aid prompted by the coronavirus pandemic will cut poverty nearly in half this year from prepandemic levels and push the share of Americans in poverty to the lowest level on record, according to the most comprehensive analysis yet of a vast but temporary expansion of the safety net.The number of poor Americans is expected to fall by nearly 20 million from 2018 levels, a decline of almost 45 percent. The country has never cut poverty so much in such a short period of time, and the development is especially notable since it defies economic headwinds – the economy has nearly seven million fewer jobs than it did before the pandemic. The extraordinary reduction in poverty has come at extraordinary cost, with annual spending on major programs projected to rise fourfold to more than $1 trillion. Yet without further expensive new measures, millions of families may find the escape from poverty brief. The three programs that cut poverty most – stimulus checks, increased food stamps and expanded unemployment insurance – have ended or are scheduled to soon revert to their prepandemic size. …
Private Equity invests in “Primary Care” Medicine – I am adding a brief comment here (it fits and is on topic) rather than going back to the earlier post which I believe to be titled correctly; “Little Good can Come from Private Equity in the Healthcare Industry.” As my source of information I had identified two different articles taken from Modern Healthcare and also MedPage Today. Both I read religiously and from both I get email notifications. My three points to my titling are as follows:
- “Investors spent almost 10 times more buying physician practices in the second quarter of 2021 compared with the prior-year period.” It appears Private Equity woke up. A year later they are investing 10 times more that the previous year and are investing “more,” more in one particular part of healthcare . . . Primary Care. This is new and a greater investment.
- “Involvement in Primary-Care opens the door to supplying medical services through Medicare Advantage plans which are more open to pricing than traditional Medicare.” This is a newer foray into primary care which has been ignored by Insurance Companies and Private Equity firms as the money is in Specialties. It does open a door for PE to be more involved in healthcare.“
- Insurance companies are aggressive about building out primary care acquisitions to increase their patient influence on the front end, control costs in their own Medicare Advantage plans, and to minimize outside influence. It is all about locking in people to a company’s medical network in MA. For Private Equity investors, it’s more about having leverage in negotiations with insurers if they control some doctors in an area.
Granted PE firms have been involved in healthcare; but, they have largely ignored Primary Care. Granted It is a new endeavor. I am not a Private Equity person although my investment choices has given me a secure life going forward during my remaining years. I admit, there are those who know more than I on Private Equity. I do not believe I labeled the previous post incorrectly.
SBA gives banks a break on PPP loan forgiveness The Small Business Administration will allow borrowers with Paycheck Protection Program loans of $150,000 or less to apply online for forgiveness directly from the agency.Lenders will have to opt in to allow the SBA to process the applications, and they will still issue a decision on whether to grant forgiveness, according to rulemaking documents the agency issued to the industry Wednesday. The portal will open on Aug. 4, the SBA said.The initiative, which the SBA touted as a way to start closing down a program that launched in April 2020, was welcomed by banks that are still dealing with the cost of processing applications from borrowers who want forgiveness. Through May, banks had funneled nearly $800 billion in forgivable PPP loans to small businesses hurt by the COVID-19 pandemic.
Brown wants CFPB to investigate reports of Chime account closures -Senate Banking Committee Chairman Sherrod Brown, D-Ohio, urged the Consumer Financial Protection Bureau to address the risks posed by Chime, a San Francisco fintech that sparked a backlash this year after closing consumer accounts without warning.Brown sent a letter to acting CFPB Director Dave Uejio Tuesday urging him to address the problems at Chime and other digital-only financial companies that claim to provide financial services to people not served by traditional banks.Chime launched a broad marketing campaign this year by promising to speed up payments from federal stimulus checks and unemployment insurance, only to abruptly shutter some accounts while alleging fraudulent activity.
Fees paid to Fannie and Freddie could help fund infrastructure plan – The Senate’s nearly $1 trillion bipartisan infrastructure proposal would be partially funded with an extension of the hike in guarantee fees charged by Fannie Mae and Freddie Mac.Congress originally mandated the 10-basis-point increase in fees lenders pay the government-sponsored enterprises in 2011 to fund payroll tax relief. That add-on was set to expire later this year. But in a move sure to upset the mortgage industry, legislators are now considering extending the additional fee to provide $21 billion in funding for the infrastructure package, according to a summary of the bill. The full text has yet to be finalized. Under the infrastructure plan, lawmakers also propose raising $28 billion for the package by applying information reporting requirements to digital assets, including cryptocurrency. Under that proposal, businesses would have to report crypto transactions of at least $10,000.
Freddie Mac: Mortgage Serious Delinquency Rate decreased in June –Freddie Mac reported that the Single-Family serious delinquency rate in June was 1.86%, down from 2.01% in May. Freddie’s rate is down year-over-year from 2.48% in June 2020. Freddie’s serious delinquency rate peaked in February 2010 at 4.20% following the housing bubble, and peaked at 3.17% in August 2020 during the pandemic. These are mortgage loans that are “three monthly payments or more past due or in foreclosure”. Mortgages in forbearance are being counted as delinquent in this monthly report, but they will not be reported to the credit bureaus. This is very different from the increase in delinquencies following the housing bubble. Lending standards have been fairly solid over the last decade, and most of these homeowners have equity in their homes – and they will be able to restructure their loans once (if) they are employed. Also – for multifamily – delinquencies were at 0.15%, down from 0.19% in May, and down from the peak of 0.20% in April 2021.
Fannie Mae: Mortgage Serious Delinquency Rate Decreased in June -Fannie Mae reported that the Single-Family Serious Delinquency decreased to 2.08% in June, from 2.24% in May. The serious delinquency rate is down from 2.65% in June 2020.These are mortgage loans that are “three monthly payments or more past due or in foreclosure”. The Fannie Mae serious delinquency rate peaked in February 2010 at 5.59% following the housing bubble, and peaked at 3.32% in August 2020 during the pandemic. By vintage, for loans made in 2004 or earlier (1% of portfolio), 5.04% are seriously delinquent (down from 5.27% in May). For loans made in 2005 through 2008 (2% of portfolio), 8.75% are seriously delinquent(down from 9.09%), For recent loans, originated in 2009 through 2021 (97% of portfolio), 1.69% are seriously delinquent (down from 1.82%). So Fannie is still working through a few poor performing loans from the bubble years.Mortgages in forbearance are counted as delinquent in this monthly report, but they will not be reported to the credit bureaus.This is very different from the increase in delinquencies following the housing bubble. Lending standards have been fairly solid over the last decade, and most of these homeowners have equity in their homes – and they will be able to restructure their loans once they are employed.
MBA Survey: “Share of Mortgage Loans in Forbearance Slightly Decreases to 3.48%” – Note: This is as of July 18th. From the MBA: Share of Mortgage Loans in Forbearance Slightly Decreases to 3.48%: The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 2 basis points from 3.50% of servicers’ portfolio volume in the prior week to 3.48% as of July 18, 2021. According to MBA’s estimate, 1.74 million homeowners are in forbearance plans. The share of Fannie Mae and Freddie Mac loans in forbearance decreased 2 basis points to 1.81%. Ginnie Mae loans in forbearance decreased 1 basis point to 4.35%, while the forbearance share for portfolio loans and private-label securities (PLS) increased 5 basis points to 7.38%. The percentage of loans in forbearance for independent mortgage bank (IMB) servicers remained the same relative to the prior week at 3.68%, and the percentage of loans in forbearance for depository servicers decreased 1 basis point to 3.61%. “As is typical for mid-month reporting, forbearance exits slowed, and there was a slight increase in new requests. The net result was a small drop in the share of loans in forbearance – the 21 st consecutive week of declines,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “The forbearance share decreased for GSE and Ginnie Mae loans, but increased for portfolio and PLS loans, as new forbearance requests increased for this category.” This graph shows the percent of portfolio in forbearance by investor type over time. Most of the increase was in late March and early April 2020, and has trended down since then. The MBA notes: “Total weekly forbearance requests as a percent of servicing portfolio volume (#) increased relative to the prior week: from 0.03% to 0.04%”
Black Knight: Number of Homeowners in COVID-19-Related Forbearance Plans Increased Slightly -Note: Both Black Knight and the MBA (Mortgage Bankers Association) are putting out weekly estimates of mortgages in forbearance.This data is as of July 27th.From Andy Walden at Black Knight: Forbearances See Weekly Rise: After the last couple of weeks of volumes remaining flat, we did see some movement in the number of active forbearance plans this past week. According to our McDash Flash daily Forbearance Tracker data, the total number of active plans is up by 31,000 since last Tuesday.Such upward movement late in the month has been relatively common in the recovery to date. Plan removals are clustered early in the month, which tends to lead to some degree of restart activity as the month progresses.Despite this increase, there are still 163,000 (-7.9%) fewer plans than at the same time last month. As of July 27, 1.9 million borrowers remain in COVID-19 forbearance plans, making up 3.6% of all active mortgages and 2.0% of GSE, 6.3% of FHA/VA and 4.4% of Portfolio/PLS loans.Forbearances rose most significantly among loans held in bank portfolios or private label securities – which were up 35,000 for the week – with FHA/VA mortgages seeing a slight uptick in plans as well (+1,000). The 5,000-plan decline among GSE loans offset just a small share of the total weekly rise.There are still some 179,000 plans are still scheduled to be reviewed for extension/removal in July, which provides some substantial opportunity for improvement next week.While still low, new forbearance plan starts hit their highest weekly level since late March, with restart activity also remaining elevated. Roughly 2/3 of all starts over the past week were restarts. Removal volumes were the lowest since late May given the low volume of review activity at this time of month.
Eleven million families in the US at risk of losing their homes as CDC eviction moratorium set to expire – An historic and devastating wave of evictions and foreclosures looms, with the Centers for Disease Control and Prevention’s (CDC) federal eviction moratorium set to expire at the end of this week, on July 31. With just days to go, there is no indication the Biden administration is going to extend it. White House Press Secretary Jen Psaki boasted in a press conference on Friday about vague efforts by the Biden administration to “help people with government-backed mortgages stay in their homes through monthly payment reductions and potential loan modifications.” Noticeably absent was any reference to the end of the moratorium or relief for renters. At his CNN town hall event on Wednesday, President Biden did not even speak about the housing crisis. Nor did he say anything about it on Friday when he spoke at a campaign rally in Arlington in support of Democrat Terry McAuliffe’s run for governor of Virginia. Last year exceeded the $10 trillion mark in housing debt for the first time in history, according to the New York Fed’s Household Debt and Credit Report, reaching levels higher than those seen in the third quarter of 2008, which reached just under $10 trillion. This creates the obvious preconditions, paired with job losses, attacks on workers’ wages and a new surge in the pandemic, for an immense foreclosure crisis. Despite the CDC’s moratorium, which was issued on September 4, 2020 as state-level moratoriums expired, over 444,000 evictions have been ordered during the pandemic, with over 6,600 in the week preceding July 17, according to Princeton University’s Eviction Lab. According to the Eviction Lab, neighborhoods with the highest eviction filing rates have the lowest COVID-19 vaccination rates. The housing crisis presents an immediate danger to public health, especially given the spread of COVID-19 among the homeless population, which many of those being evicted or foreclosed on will join. Much of the $47 billion in federal aid for renters provided under pandemic stimulus programs is being held up by state governments, with the end of the moratorium expected to create a surge in evictions the money was ostensibly intended to prevent. According to figures released in March by the Consumer Financial Protection Bureau, 11 million families are at risk of losing housing, with 2.1 million being at least three months behind on mortgage payments, while 8.8 million are behind on rent.
Home Ownership Rate: 65.6% in Q2 2021 -The Census Bureau has now released its latest quarterly report with data through Q2 2021. The seasonally adjusted rate for Q2 is 65.6 percent, unchanged from Q1. The nonseasonally adjusted Q2 number is 65.4 percent, down from the Q1 2021 65.6 percent figure. Over the last decade, the general trend has been consistent: The rate of homeownership continued to struggle. The recent recession as a result of the COVID-19 global pandemic caused a massive, but brief, jump in homeownership due to grossly reduced spending.Here’s an excerpt from the press release:Announcement: Due to the coronavirus pandemic (COVID-19), data collection operations for the CPS/HVS were slightly affected during the second quarter of 2021, though to a much lesser extent than last year, as in-person interviews were allowed for 99 percent of the country. The remaining interviews were conducted over the telephone. If the Field Representative was unable to get contact information on the sample unit, the unit was made a Type A noninterview (no one home, refusal, etc). We are unable to determine the extent to which this data collection change affected our estimates. See the FAQ for more information.National vacancy rates in the second quarter 2021 were 6.2 percent for rental housing and 0.9 percent for homeowner housing. The rental vacancy rate was 0.5 percentage points higher than the rate in the second quarter 2020 (5.7 percent) and 0.6 percentage points lower than the rate in the first quarter 2021 (6.8 percent). The homeowner vacancy rate of 0.9 percent was virtually the same as the rate in the second quarter 2020 (0.9 percent) and virtually the same as the rate in the first quarter 2021 (0.9 percent).The homeownership rate of 65.4 percent was 2.5 percentage points lower than the rate in the second quarter 2020 (67.9 percent) and not statistically different from the rate in the first quarter 2021 (65.6 percent). Data users should see the FAQ regarding statistical comparisons to quarters affected by the COVID-19 pandemic.The Census Bureau has been tracking the nonseasonally adjusted data since 1965. Their seasonally adjusted version only goes back to 1980. Here is a snapshot of the nonseasonally adjusted series with a 4-quarter moving average to highlight the trend.
FHFA House Price Index: Up 1.7% in May, All Time High – The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for May. Here is the opening of the press release: – House prices rose nationwide in May, up 1.7 percent from the previous month, according to the latest Federal Housing Finance Agency House Price Index (FHFA HPI). House prices rose 18.0 percent from May 2020 to May 2021. The previously reported 1.8 percent price change for April 2021 was unrevised. For the nine census divisions, seasonally adjusted monthly house price changes from April 2021 to May 2021 ranged from +1.0 percent in the Middle Atlantic division to +2.4 percent in the Pacific division. The 12-month changes ranged from +15.4 percent in the West South Central division to +23.2 percent in the Mountain division.”House prices continued their record-setting growth into May,” said Dr. Lynn Fisher, FHFA’s Deputy Director of the Division of Research and Statistics. “This trend will likely continue around the country as busy summer homebuying months maintain the pressure being felt in already tight housing markets.” The chart below illustrates the monthly HPI series, which is not adjusted for inflation, along with a real (inflation-adjusted) series using the Consumer Price Index: All Items Less Shelter.
Case-Shiller: National House Price Index increased 16.6% year-over-year in May –S&P/Case-Shiller released the monthly Home Price Indices for May (“May” is a 3 month average of March, April and May prices). This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index. From S&P: S&P Corelogic Case-Shiller Index Reports Record High Annual Home Price Gain Of 16.6% In May The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 16.6% annual gain in May, up from 14.8% in the previous month. The 10-City Composite annual increase came in at 16.4%, up from 14.5% in the previous month. The 20-City Composite posted a 17.0% year-over-year gain, up from 15.0% in the previous month.Phoenix, San Diego, and Seattle reported the highest year-over-year gains among the 20 cities in May. Phoenix led the way with a 25.9% year-over-year price increase, followed by San Diego with a 24.7% increase and Seattle with a 23.4% increase. All 20 cities reported higher price increases in the year ending May 2021 versus the year ending April 2021….Before seasonal adjustment, the U.S. National Index posted a 2.1% month-over-month increase in May, while the 10-City and 20-City Composites both posted increases of 1.9% and 2.1%, respectivelyAfter seasonal adjustment, the U.S. National Index posted a month-over-month increase of 1.7%, and the 10-City and 20-City Composites both posted increases of 1.7% and 1.8%, respectively. In May, all 20 cities reported increases before and after seasonal adjustments.The 16.6% gain is the highest reading in more than 30 years of S&P CoreLogic Case-Shiller data. As was the case last month, five cities – Charlotte, Cleveland, Dallas, Denver, and Seattle – joined the National Composite in recording their all-time highest 12-month gains. Price gains in all 20 cities were in the top quartile of historical performance; in 17 cities, price gains were in top decile.”We have previously suggested that the strength in the U.S. housing market is being driven in part by reaction to the COVID pandemic, as potential buyers move from urban apartments to suburban homes. May’s data continue to be consistent with this hypothesis. This demand surge may simply represent an acceleration of purchases that would have occurred anyway over the next several years. Alternatively, there may have been a secular change in locational preferences, leading to a permanent shift in the demand curve for housing. More time and data will be required to analyze this question. The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).
Zillow Case-Shiller House Price Forecast: “Expected to decelerate”, 16.2% YoY in June – The Case-Shiller house price indexes for May were released yesterday. Zillow forecasts Case-Shiller a month early, and I like to check the Zillow forecasts since they have been pretty close. From Matthew Speakman at Zillow: May 2021 Case-Shiller Results & Forecast: Growth Continues Climb The forces that have propelled home price growth to new highs over the past year remain in place and are offering little evidence of abating. … The housing market’s historically tight inventory conditions finally started to ease in May, but that did little to immediately tame the record-strong home price appreciation that the market has experienced in recent months. The number available homes across the nation finally ticked up this spring, albeit from a historically low reference point, after spending most of the last year in a steady decline. Still, price pressures remain very firm and appear ready to stay that way in the months to come. Indeed, sharply-rising prices do appear to have priced out some home shoppers, particularly those looking to enter the market for the first time, and causing fatigue among would-be buyers. But overall demand for homes remains very firm, as bidding wars persist and the still-relatively few homes available for sales continue to fly off the shelves at a historically fast pace. Increased inventory levels should eventually help tame the record-high pace of price appreciation, but it’s going to take a while. Monthly and annual growth in June as reported by Case-Shiller is expected to deceleratefrom May and April 2020 in all three main indices. S&P Dow Jones Indices is expected to release data for the June S&P CoreLogic Case-Shiller Indices on Tuesday, August 24. The Zillow forecast is for the year-over-year change for the Case-Shiller National index to be at 16.2% in June, from 16.6% in May.
New Home Sales Decrease to 676,000 Annual Rate in June – The Census Bureau reports New Home Sales in June were at a seasonally adjusted annual rate (SAAR) of 676 thousand. The previous three months were revised down sharply. Sales of new singleâ€family houses in June 2021 were at a seasonally adjusted annual rate of 676,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 6.6 percent below the revised May rate of 724,000 and is 19.4 percent below the June 2020 estimate of 839,000. The first graph shows New Home Sales vs. recessions since 1963. The dashed line is the current sales rate. This is the start of likely year-over-year declines since sales soared following the first few months of the pandemic. The second graph shows New Home Months of Supply. The months of supply increased in June to 6.3 months from 5.5 months in May. The all time record high was 12.1 months of supply in January 2009. The all time record low was 3.5 months, most recently in October 2020. This is above the normal range (about 4 to 6 months supply is normal). Starting in 1973 the Census Bureau broke inventory down into three categories: Not Started, Under Construction, and Completed. The third graph shows the three categories of inventory starting in 1973. The inventory of completed homes for sale is just above the record low, but the combined total of completed and under construction is close to normal. The last graph shows sales NSA (monthly sales, not seasonally adjusted annual rate). In June 2021 (red column), 60 thousand new homes were sold (NSA). Last year, 79 thousand homes were sold in June. The all time high for June was 115 thousand in 2005, and the all time low for June was 28 thousand in 2010 and in 2011. This was well below expectations of 800 thousand sales SAAR, and sales in the three previous months were revised down significantly.
A few Comments on June New Home Sales – New home sales for June were reported at 676,000 on a seasonally adjusted annual rate basis (SAAR). Sales for the previous three months were revised down significantly. This was well below consensus expectations for June, and probably the start of a number of months with year-over-year declines. However, sales were in line with home builder comments about “limiting sales”, closing communities and limited finished inventory. Earlier: New Home Sales Decrease to 676,000 Annual Rate in June.This graph shows new home sales for 2020 and 2021 by month (Seasonally Adjusted Annual Rate). The year-over-year comparisons were easy in the first half of 2021 – especially in March and April. However, sales will likely be down year-over-year in the 2nd half of 2021 – since the selling season was delayed in 2020.And on inventory: note that completed inventory (3rd graph in previous post) is near record lows, but inventory under construction is closer to normal. This graph shows the months of supply by stage of construction.The inventory of completed homes for sale was at 36 thousand in June, just above the record low of 33 thousand in March and April 2021. That is about 0.6 months of completed supply (just above the record low).The inventory of new homes under construction, and not started, is at 5.6 months – slightly above the normal level. However, a record 105 thousand homes have not been started – about double the normal level.
NAR: Pending Home Sales Decreased 1.9% in June -From the NAR: Pending Home Sales Fall 1.9% in June: Pending home sales declined marginally in June after recording a notable gain in May, the National Association of Realtors reported. Contract activity was split in the four major U.S. regions from both a year-over-year and month-over-month perspective. The Northeast recorded the only yearly gains in June. The Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, fell 1.9% to 112.8 in June. Year-over-year, signings also slipped 1.9%. An index of 100 is equal to the level of contract activity in 2001….The Northeast PHSI increased 0.5% to 98.5 in June, an 8.7% rise from a year ago. In the Midwest, the index grew 0.6% to 108.3 last month, down 2.4% from June 2020.Pending home sales transactions in the South fell 3.0% to an index of 132.4 in June, down 4.7% from June 2020. The index in the West decreased 3.8% in June to 98.1, down 2.6% from a year prior. This was below expectations of a 0.5% increase for this index. Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in July and August.
Q2 2021 GDP Details on Residential and Commercial Real Estate – The BEA released the underlying details for the Q2 advance GDP report today. The BEA reported that investment in non-residential structures decreased at a 7.0% annual pace in Q2. Note that weakness in non-residential structures started in 2019, before the pandemic. Investment in petroleum and natural gas structures increased sharply in Q2 compared to Q1, and was up 46% year-over-year. However, investment in petroleum and natural gas structures is still down over 60% from the peak in 2014. The first graph shows investment in offices, malls and lodging as a percent of GDP. Investment in offices (blue) decreased in Q2, and was down 9.0% year-over-year. Investment in multimerchandise shopping structures (malls) peaked in 2007 and was down about 19% year-over-year in Q2 – and at a record low as a percent of GDP. The vacancy rate for malls is still very high, so investment will probably stay low for some time. Lodging investment increased slightly in Q2 compared to Q1, but lodging investment was down 19% year-over-year. All three sectors – offices, malls, and hotels – are being hurt significantly by the pandemic. The second graph is for Residential investment components as a percent of GDP. According to the Bureau of Economic Analysis, RI includes new single family structures, multifamily structures, home improvement, Brokers’ commissions and other ownership transfer costs, and a few minor categories (dormitories, manufactured homes). Even though investment in single family structures has increased from the bottom, single family investment is just approaching normal levels as a percent of GDP. Investment in single family structures was $405 billion (SAAR) (about 1.8% of GDP), and up 45% year-over-year. Investment in multi-family structures increased in Q2. Investment in home improvement was at a $331 billion Seasonally Adjusted Annual Rate (SAAR) in Q2 (about 1.5% of GDP). Home improvement spending has been strong during the pandemic. Note that Brokers’ commissions (black) increased sharply last year as existing home sales increased in the second half of 2020, but was down in Q2. Brokers’ commissions were up 49% year-over-year in Q2.
Hotels: Occupancy Rate Down 8% Compared to Same Week in 2019 –Note: The year-over-year occupancy comparisons are easy, since occupancy declined sharply at the onset of the pandemic. So STR is comparing to the same week in 2019.The occupancy rate is down 7.8% compared to the same week in 2019. From CoStar: STR: US Weekly Hotel Occupancy Reaches Highest Level Since October 2019: U.S. weekly hotel occupancy reached its highest level since October 2019, while room rates hit an all-time high, according to STR’s latest data through July 24.
July 18-24, 2021 (percentage change from comparable week in 2019*):
Occupancy: 71.4% (-7.8%)
Average daily rate (ADR): $141.75 (+4.0%)
Revenue per available room (RevPAR): $101.24 (-4.2%)
Historically, the middle weeks of July are the country’s highest occupancy weeks each year, and 2021 has been no different even as demand slows week to week.The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.The red line is for 2021, black is 2020, blue is the median, dashed purple is 2019, and dashed light blue is for 2009 (the worst year on record for hotels prior to 2020). Occupancy is well above the horrible 2009 levels and weekend occupancy (leisure) has been solid. With solid leisure travel, the Summer months have had decent occupancy – but it is uncertain what will happen in the Fall with business travel.
Las Vegas Visitor Authority for June: Convention Attendance N/A, Visitor Traffic Down 18% Compared to 2019 -From the Las Vegas Visitor Authority: June 2021 Las Vegas Visitor Statistics Marking the sixth consecutive month of MoM gains, June saw the destination host more than 2.9 million visitors, +3.2% MoM and down â€17.6% vs. June 2019.
While convention and group data continue to be gathered, the return of several conventions including World of Concrete, Surfaces, Nightclub & Bar and the Int’l Esthetics, Cosmetics & Spa Conference helped support midweek business. Hotel occupancy continued to improve, reaching 75.9% (up 5.0 pts MoM, down â€15.8 pts vs. June 2019), as Weekend occupancy neared 90% (89.4%) and Midweek occupancy reached 70.9% (up 8.1 pts MoM, down â€18.8 pts vs. June 2019.) The first graph shows visitor traffic for 2019 (blue), 2020 (orange) and 2021 (red).Visitor traffic was down 17.6% compared to the same month in 2019 There had been no convention traffic since March 2020, but there were a few conventions in June (data not available yet). I’ll add a graph of convention traffic once convention data is available. Note: Conventions started again in June, but the data isn’t available yet.
Personal Income increased 0.1% in June, Spending increased 1.0% – The BEA released the Personal Income and Outlays, June 2021 and Annual Update report: Personal income increased $26.1 billion (0.1 percent) in June according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) decreased $2.6 billion (less than 0.1 percent) and personal consumption expenditures (PCE) increased $155.4 billion (1.0 percent). Real DPI decreased 0.5 percent in June and Real PCE increased 0.5 percent; goods decreased 0.2 percent and services increased 0.8 percent. The PCE price index increased 0.5 percent. Excluding food and energy, the PCE price index increased 0.4 percent. The June PCE price index increased 4.0 percent year-over-year and the June PCE price index, excluding food and energy, increased 3.5 percent year-over-year.The following graph shows real Personal Consumption Expenditures (PCE) through June 2021 (2012 dollars). Note that the y-axis doesn’t start at zero to better show the change. The dashed red lines are the quarterly levels for real PCE. Personal income and personal spending were above expectations, and the increase in PCE was slightly below expectations.
June personal income and spending show pandemic cushion approaching depletion –How well personal income and spending held up throughout the pandemic is one of the best things about the government response. For June, nominal personal income increased 0.1%. After inflation, however, it decreased -0.4%. Nominal personal spending increased 1.0%. After inflation, it still increased 0.5%. Here are the real figures for both personal spending and disposable income: Expenditures are up 2.7% since right before the pandemic, while income is up 3.3%. Here is how real personal spending compares with the other side of the coin, real retail sales: Both of these have returned to basically normal levels m/m. While the stimulus has abated, spending hasn’t crashed. That’s a good thing. The cushion of the increased pandemic stimulus has also largely faded in the personal savings rate: This tells us that within the next few months that cushion is probably going to be exhausted, and consumers are going to have to stand on their own.
Real Disposable Income Per Capita in June Down 0.6%, Revisions Made – With the release of this morning’s report on June’s Personal Incomes and Outlays, we can now take a closer look at “Real” Disposable Personal Income Per Capita. At two decimal places, the nominal -0.04% month-over-month change in disposable income is cut to -0.55% when we adjust for inflation. This is an increase from last month’s -2.74% nominal and -3.33% real decreases. The year-over-year metrics are 0.46% nominal and -3.41% real.Post-Great recession, the trend was one of steady growth, but generally flattened out in late 2015 with increases in 2012 and 2013. As a result of COVID pandemic stimulus measures, major spikes can be seen in April 2020, January 2021 (a December 2020 payment), and March 2021.The first chart shows both the nominal per capita disposable income and the real (inflation-adjusted) equivalent since 2000. This indicator was significantly disrupted by the bizarre but predictable oscillation caused by 2012 year-end tax strategies in expectation of tax hikes in 2013 and more recently, by COVID stimulus. The BEA uses the average dollar value in 2012 for inflation adjustment. But the 2012 peg is arbitrary and unintuitive. For a more natural comparison, let’s compare the nominal and real growth in per-capita disposable income since 2000. Nominal disposable income is up 112% since then. But the real purchasing power of those dollars is up 41.9%.
Consumer Confidence Mostly Unchanged in July – The headline number of 129.1 was an increase of 0.2 from the final reading of 128.9 for June. This was above the Investing.com consensus of 123.9. “Consumer confidence was flat in July but remains at its highest level since February 2020 (132.6),” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “Consumers’ appraisal of present-day conditions held steady, suggesting economic growth in Q3 is off to a strong start. Consumers’ optimism about the short-term outlook didn’t waver, and they continued to expect that business conditions, jobs, and personal financial prospects will improve. Short-term inflation expectations eased slightly but remained elevated. Spending intentions picked up in July, with a larger percentage of consumers saying they planned to purchase homes, automobiles, and major appliances in the coming months. Thus, consumer spending should continue to support robust economic growth in the second half of 2021.”Read more … The chart below is another attempt to evaluate the historical context for this index as a coincident indicator of the economy. Toward this end, we have highlighted recessions and included GDP. The regression through the index data shows the long-term trend and highlights the extreme volatility of this indicator. Statisticians may assign little significance to a regression through this sort of data. But the slope resembles the regression trend for real GDP shown below, and it is a more revealing gauge of relative confidence than the 1985 level of 100 that the Conference Board cites as a point of reference.
Durable-Goods Orders Advanced in June as U.S. Economy Continues to Grow – WSJ – Orders for cars, appliances and other durable goods increased in June, signaling continued strength in the U.S. economy as manufacturers continue to deal with shortages in parts and labor and confront higher material costs.New orders for products meant to last at least three years increased 0.8% to a seasonally adjusted $257.6 billion in June as compared with May, the Commerce Department said Tuesday. Economists surveyed by The Wall Street Journal had estimated a 2% gain. Orders increased 3.2% in May from the prior month, a slightly better reading than the previous estimate of 2.3%. Demand for durable goods has increased in 13 of the last 14 months.Low business and retail inventories have translated to increased demand for manufacturers, but supply-chain issues continue to constrain production and delay some shipments. New orders for nondefense capital goods excluding aircraft – so-called core capital-goods, a closely watched proxy for business investment – increased 0.5% in June from the previous month. The prior month such orders also were up 0.5%. “Despite supply chain challenges the outlook remains bright,” Wells Fargo Securities economists Tim Quinlan and Sarah House said in their analysis following the release, citing continued gains in core capital goods orders.
Richmond Fed Manufacturing: Continued Strength in July -Fifth District manufacturing activity showed continued growth in July, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite index rose to 27 from 26 in June and indicates expansion.The complete data series behind today’s Richmond Fed manufacturing report, which dates from November 1993, is available here.Here is a snapshot of the complete Richmond Fed Manufacturing Composite series. Here is an excerpt from the latest Richmond Fed manufacturing overview:Fifth District manufacturing activity strengthened in July, according to the most recent survey from the Federal Reserve Bank of Richmond. The composite index inched up from 26 in June to 27 in July, buoyed by increases in the shipments and employment indexes, while the third component index – new orders – declined but remained in expansionary territory. The indexes for inventories of raw materials and of finished goods declined, as both of these indexes hit record lows, and vendor lead times continued to lengthen. Manufacturers were optimistic that business conditions would improve further in the coming months. Link to ReportHere is a somewhat closer look at the index since the turn of the century.
July Dallas Fed Manufacturing – This morning the Dallas Fed released its Texas Manufacturing Outlook Survey for July. The latest general business activity index came in at 27.3, down 3.8 from 31.1 in June. All figures are seasonally adjusted. Here is an excerpt from the latest report:Texas factory activity continued its robust expansion in July, according to business executives responding to the Texas Manufacturing Outlook Survey. The production index, a key measure of state manufacturing conditions, was largely unchanged at 31.0, a reading well above average and indicative of strong output growth. Other measures of manufacturing activity also pointed to continued growth this month.Expectations regarding future manufacturing activity remained optimistic in July. The future production index slipped eight points to 48.4, and the future general business activity index was unchanged at 37.1. Most other measures of future manufacturing activity declined but remained solidly in positive territory. Monthly data for this indicator only dates back to 2004, so it is difficult to see the full potential of this indicator without several business cycles of data. Nevertheless, it is an interesting and important regional manufacturing indicator.
July Regional Fed Manufacturing Overview -Five out of the twelve Federal Reserve Regional Districts currently publish monthly data on regional manufacturing: Dallas, Kansas City, New York, Richmond, and Philadelphia.Regional manufacturing surveys are a measure of local economic health and are used as a representative for the larger national manufacturing health. They have been used as a signal for business uncertainty and economic activity as a whole. Manufacturing makes up 12% of the country’s GDP.The other 6 Federal Reserve Districts do not publish manufacturing data. For these, the Federal Reserve’s Beige Book offers a short summary of each districts’ manufacturing health. The Chicago Fed published their Midwest Manufacturing Index from July 1996 through December of 2013. According to their website, “The Chicago Fed Midwest Manufacturing Index (CFMMI) is undergoing a process of data and methodology revision. In December 2013, the monthly release of the CFMMI was suspended pending the release of updated benchmark data from the U.S. Census Bureau and a period of model verification. Significant revisions in the history of the CFMMI are anticipated.” Five out of the twelve Federal Reserve Regional Districts currently publish monthly data on regional manufacturing: Dallas, Kansas City, New York, Richmond, and Philadelphia. The latest average of the five for July is 30, up from the previous month.
Global supply chains buckle as virus variant and disasters strike – (Reuters) – A new worldwide wave of COVID-19. Natural disasters in China and Germany. A cyber attack targeting key South African ports. Events have conspired to drive global supply chains towards breaking point, threatening the fragile flow of raw materials, parts and consumer goods, according to companies, economists and shipping specialists. The Delta variant of the coronavirus has devastated parts of Asia and prompted many nations to cut off land access for sailors. That’s left captains unable to rotate weary crews and about 100,000 seafarers stranded at sea beyond their stints in a flashback to 2020 and the height of lockdowns. “We’re no longer on the cusp of a second crew change crisis, we’re in one,” Guy Platten, secretary general of the International Chamber of Shipping, told Reuters. “This is a perilous moment for global supply chains.” Given ships transport around 90% of the world’s trade, the crew crisis is disrupting the supply of everything from oil and iron ore to food and electronics. German container line Hapag Lloyd described the situation as “extremely challenging”. “Vessel capacity is very tight, empty containers are scarce and the operational situation at certain ports and terminals is not really improving,” it said. “We expect this to last probably into the fourth quarter – but it is very difficult to predict.” Meanwhile, deadly floods in economic giants China and Germany have further ruptured global supply lines that had yet to recover from the first wave of the pandemic, compromising trillions of dollars of economic activity that rely on them. The Chinese flooding is curtailing the transport of coal from mining regions such as Inner Mongolia and Shanxi, the state planner says, just as power plants need fuel to meet peak summer demand. In Germany, road transportation of goods has slowed significantly. In the week of July 11, as the disaster unfolded, the volume of late shipments rose by 15% from the week before, according to data from supply-chain tracking platform FourKites. Manufacturing industries are reeling. Automakers, for example, are again being forced to stop production because of disruptions caused by COVID-19 outbreaks. Toyota Motor Corp said this week it had to halt operations at plants in Thailand and Japan because they couldn’t get parts. Stellantis temporarily suspended production at a factory in the U.K. because a large number of workers had to isolate to halt the spread of the virus. The industry has already been hit hard by a global shortage of semiconductors this year, mainly from Asian suppliers. Earlier this year, the auto industry consensus was that the chip supply crunch would ease in the second half of 2021 – but now some senior executives say it will continue into 2022. An executive at a South Korea auto parts maker, which supplies Ford, Chrysler and Rivian, said raw materials costs for steel which was used in all their products had surged partly due to higher freight costs.
U.S. Population Growth, an Economic Driver, Grinds to a Halt – WSJ – America’s weak population growth, already held back by a decadelong fertility slump, is dropping closer to zero because of the Covid-19 pandemic. In half of all states last year, more people died than were born, up from five states in 2019. Early estimates show the total U.S. population grew 0.35% for the year ended July 1, 2020, the lowest ever documented, and growth is expected to remain near flat this year.Some demographers cite an outside chance the population could shrink for the first time on record. Population growth is an important influence on the size of the labor market and a country’s fiscal and economic strength. One bad year doesn’t automatically spell trouble for future U.S. demographic health. What concerns demographers is that in the past, when a weak economy drove down births, it was often a temporary phenomenon that reversed once the economy bounced back.Yet after births peaked in 2007, they never rebounded from the nearly two-year recession that followed, even though Americans enjoyed a subsequent decade of economic growth.With the birthrate already drifting down, the nudge from the pandemic could result in what amounts to a scar on population growth, researchers say, which could be deeper than those left by historic periods of economic turmoil, such as the Great Depression and the stagnation and inflation of the 1970s, because it is underpinned by a shift toward lower fertility. “The economy of the developed world for the last two centuries now has been built on demographic expansion,” said Richard Jackson, president of the Global Aging Institute, a nonprofit research and education group. “We no longer have this long-term economic and geopolitical advantage.”
Weekly Initial Unemployment Claims decrease to 400,000 — The DOL reported: In the week ending July 24, the advance figure for seasonally adjusted initial claims was 400,000, a decrease of 24,000 from the previous week’s revised level. The previous week’s level was revised up by 5,000 from 419,000 to 424,000. The 4-week moving average was 394,500, an increase of 8,000 from the previous week’s revised average. The previous week’s average was revised up by 1,250 from 385,250 to 386,500.This does not include the 95,166 initial claims for Pandemic Unemployment Assistance (PUA) that was down from 109,868 the previous week.The following graph shows the 4-week moving average of weekly claims since 1971. The four-week average of weekly unemployment claims increased to 394,500.The previous week was revised up.Regular state continued claims increased to 3,269,000 (SA) from 3,262,000 (SA) the previous week.There are an additional 5,246,162 receiving Pandemic Unemployment Assistance (PUA) that increased from 5,133,938 the previous week (there are questions about these numbers). This is a special program for business owners, self-employed, independent contractors or gig workers not receiving other unemployment insurance. And an additional 4,233,883 receiving Pandemic Emergency Unemployment Compensation (PEUC) down from 4,134,716.Weekly claims were at the consensus forecast.
Hotel Jobs in New York, Illinois Hit Hardest by Coronavirus Pandemic — New York and Illinois are among the states that have lost the highest percentage of hotel jobs due to the coronavirus pandemic and are still hurting even as travel starts to return to normal levels across the country, according to a new report. The data released this week by the American Hotel & Lodging Association shows that projections for the industry remain “well below pre-pandemic levels,” according to a news release. The association notes that more than 1 in 5 direct hotel operations jobs lost during the pandemic – about 500,000 total – will not return by the end of 2021, and the lost room revenue will amount to $44 billion compared to 2019.In percentage terms compared to 2019, New York (37.9%), Illinois (35.2%), Massachusetts(30.2%) and Hawaii (28.8%) are the states that are seeing the biggest hotel job losses expected by the end of 2021, according to the association’s state-by-state breakdown. The hotel industry in Washington, D.C. – also covered in the report – has been hit even harder, with job losses at 43.1%. COVID-19-induced hotel job losses for the country as a whole are nearly 21%, and 19 states have losses higher than the national average.”Despite an uptick in leisure travel, midway through 2021 we’re still seeing that the road to a full recovery for America’s hotels is long and uneven,” said Chip Rogers, the association’s president and CEO, in a statement.Travel and tourism is coming back in the U.S. as restrictions lift, but Jennifer Myers, AHLA’s senior director of government affairs communications, tells U.S. News via email that the recovery is happening “unevenly” with business travel lagging the recovery in leisure.”While the recent uptick in leisure travel for summer is encouraging, business and group travel, the industry’s largest source of revenue, will take significantly longer to recover,” Myers says. “Business travel is down and not expected to return to 2019 levels until at least 2023 or 2024. Major events, conventions and business meetings have also already been canceled or postponed until at least 2022.”
Walmart to offer free college tuition and books to employees as recruitment lags – Walmart announced on Tuesday that it will pay for college tuition and books for its associates as an incentive to attract more people to work for the company and grow their careers. The initiative, according to Walmart, is part of its Live Better U education program. The company is investing nearly $1 billion over the next five years for career-driven training and development. Previously, the retailer charged its employees $1 per day to participate in the program, and the company would pay for the rest of the educational costs. However, this fee will be removed for all associates beginning on Aug. 16, effectively making all education programs paid for by Walmart. “We are creating a path of opportunity for our associates to grow their careers at Walmart, so they can continue to build better lives for themselves and their families,” Lorraine Stomski, senior vice president of learning and leadership at Walmart, said in a statement. “This investment is another way we can support our associates to pursue their passion and purpose while removing the barriers that too often keep adult working learners from obtaining degrees,” she added. The Live Better U program was established three years ago to assist employees with moving up in the company, according to The Washington Post. The workers are able to select from 10 academic partners, including the University of Arizona, the University of Denver, Purdue University Global and Southern New Hampshire University, according to the Post. More than 52,000 Walmart employees have reportedly taken part in the program since 2018, with upwards of 8,000 graduating.
Americans Spent More Time Watching Television During COVID-19 Than Working – The coronavirus pandemic largely altered how people engage with the world, including how Americans spend their time. Perhaps most distinctively, the share of employed Americans working from home nearly doubled during the COVID-19 pandemic in 2020, rising to 42%, according to the U.S. Bureau of Labor Statistics’ American Time Use Survey, released on Thursday. As more Americans began working from home, average travel times decreased across all demographics, while the average time individuals spent alone increased, according to the survey, which measures the average amount of time per day individuals spent working, providing child care, traveling and engaging in leisure and sports activities, among other metrics. The survey uses data gathered between May and December of 2020 because of a temporary data collection suspension due to the coronavirus pandemic. After sleeping, Americans spent most of their time watching television, averaging about 3.1 hours per day – just slightly more time than they spent working.Across all demographics, the amount of time Americans spent engaged in leisure and sports activities, including watching television, increased during the coronavirus pandemic to just over 5.5 hours per day from 5 hours in 2019, according to the survey. Men saw a 37-minute increase in leisure time during the pandemic, whereas women gained 27 minutes, the survey says. Watching television, including watching live programming, viewing DVDs, and streaming shows on TV sets, computers and portable devices, occupied the most time in 2020 of any leisure activity, ranging from more than 5 hours per day for those 75 and older to just over 2 hours per day for those ages 35 to 44.But Americans in some states watch more television than others. The BLS produces state-by-state tables using data collected over a five year period, with the most recent data representing the period 2015-2019. The majority of the top 10 states that watch the most TV are in the South, while most states that average the least amount of time watching TV are in the West. Between 2015 and 2019, people in West Virginia watched the most television, logging more than 3.8 hours per day, followed by Alabama and Arkansas. On the other side of the list, Alaskans on average spend just over 1.8 hours per day watching TV, followed by Utahns and Washingtonians.These states watched the most television daily:
Utilities disconnect 116,000 Pa. households after state lifts moratorium on pandemic shutoffs -Pennsylvania utilities have cut off service to 116,000 customers for nonpayment since the state lifted a moratorium on shutoffs on April 1 after astaggering number of unpaid bills piled up during the coronavirus pandemic.Though the shutoff number may appear large, utilities regulated by the Pennsylvania Public Utility Commission are actually disconnecting customers at a slower pace than they did in 2019, the year before the pandemic, allaying some concerns about a tsunami of shutoffs after the year-long moratorium was lifted.”We didn’t get a tidal wave we feared – this is very good news,” said Elizabeth R. Marx, executive director of the Pennsylvania Utility Law Project, which represents low-income customers. “But the numbers still trouble me.”Marx said there should be fewer shutoffs coming out of the pandemic because utilities put into place several new or expanded relief programs to assist customers. The PUC also required utilities to allow customers with large debts up to five years to pay overdue bills, a step to keep monthly payments affordable.Several utilities, such as Peco of Philadelphia, delayed residential terminations for several weeks after the moratorium was lifted, Marx said. PPL Electric Utilities, based in Allentown, waited until June to start residential shutoffs.Philadelphia Gas Works, the city-owned utility, ramped up shutoffs over the last three months – it disconnected no residential customers in April, 828 in May, and 3,578 in June, according to reports filed this month with the PUC. A representative of the utilities said the energy companies had always intended to ease out of the moratorium, hoping that the mass mailing of shutoff notices would induce customers to pay in full or enter into payment agreements.
The Washington Post will require employees to be vaccinated. – The Washington Post will require all employees to show that they are vaccinated against the coronavirus, the newspaper’s publisher said on Tuesday.The Post’s publisher, Frederick J. Ryan Jr., said in an email to staff that the company had decided to require proof of vaccination as a condition of employment, starting when workers return to the office in September, after hearing concerns from many employees about the emergence of coronavirus variants.”Even though the overwhelming majority of Post employees have already provided proof of vaccination, I do not take this decision lightly,” Mr. Ryan wrote in the email, which was viewed by The New York Times. “However, in considering the serious health issues and genuine safety concerns of so many Post employees, I believe the plan is the right one.”The Post, which is owned by the Amazon founder Jeff Bezos and employs more than 1,000 journalists, is planning for a Sept. 13 office return. Contractors and guests to the office would also be required to provide proof of vaccination, Mr. Ryan said. He said the company would provide accommodations for those with “documented medical conditions and religious concerns.”Mr. Ryan said in the email that all employees would come into the office three days a week in September in the first phase of the company’s return-to-office plan.Companies across the United States are wrestling with how to safely transition workers back to offices after nearly 18 months of remote work. The rising number of infections from the Delta variant has prompted many companies to rethink the return-to-office plans they announced in the spring.Many large companies have been resistant to mandating vaccines, wary of litigation, backlash and, in some instances, the risk of losing key employees. But as the vaccine has become more readily accessible, more companies have edged closer to some sort of requirement. CNN has mandated full vaccinations for all employees working in its various offices and in the field, a spokeswoman said on Tuesday. The investment bank Morgan Stanley said in June that, effective this month, visitors and employees in its New York offices would need to be vaccinated. Saks will require employees to be fully vaccinated when they start going to the office this fall. And Delta Air Lines is requiring new hires to be vaccinated.
Closing the Largest Generic Drug Plant in the US Is a Sick Joke But Joe Manchin’s daughter, a company executive, is laughing all the way to the bank. — Carla Shultz has worked for 13 years at Mylan Pharmaceuticals here – a stable, union job at the largest manufacturer of generic drugs in the United States. With Covid-19 vaccines getting approved, Shultz imagined that new work might be opening up. Instead, Mylan’s workers were informed that the company’s new owners were closing the Morgantown flagship plant and shifting the work to India or Australia, effective July 31, 2021. “We’ve had no recalls. We’ve been FDA-ready every time. It’s a pristine plant with hard-working employees. It’s just unbelievable that they would shut us down,” said Shultz this month, standing outside the ranch house where her mother, Barbara, a coal miner’s widow, sat surrounded by family photographs, hooked up to an oxygen machine. “We are losing 2,000 jobs paying an average of $60,000 to $70,000 a year, workers that are buying homes … cars, that are paying for gas at the gas pump and going to the supermarkets; that are pumping money into the economy, as well as the tax dollars going into the school systems, into the sewage systems, the water facilities and so on,” says Gouzd. In a soon-to-be-released study commissioned by the Democracy Collaborative, economist Michael Shuman puts the losses associated with the shut-down in the hundreds of millions of dollars in a state, West Virginia, that already has the sixth highest poverty rate in the country. Schuman estimates that Viatris’s plans will suck $403 million in wages from the local economy and cause knock-on effects likely to result in the loss of 4,642 jobs, or nearly 6 percent of the jobs in Monongalia County. Add up the tax losses and secondary costs of depression, addiction, and potential drug and domestic abuse, and “It’s the economic equivalent of a nuclear bomb going off in the county economy,” says Shuman. The anticipation of reduced spending by Viatris has already caused the local water utility to increase its water rates on residents.Gouzd, like Shultz, has all sorts of questions. Among them: Why hasn’t West Virginia’s senior senator, Joe Manchin, made an effort to keep the plant open? Does it have anything to do with the fact that his daughter, Heather Bresch, was a top executive at Mylan for almost eight years, and worked there for almost three decades? Bresch, the second most highly paid executive in the Pittsburgh region, left the company upon the completion of the merger, receiving a golden parachute estimated to top $30.8 million, according to the Pittsburgh Business Journal.
As Arkansas and Missouri see a rise in COVID-19 cases, more economic protections are needed – EPI Blog – Key takeaways:
- As the Delta variant of COVID-19 spreads throughout the United States, Arkansas and Missouri are facing an even more dramatic spike in COVID-19 cases, in part due to lower vaccination rates. This puts many at risk and may contribute to long-term economic problems in the region.
- To mitigate these effects, Missouri and Arkansas policymakers must take immediate action to strengthen public health and the economy, including:
- Expanding Medicaid and eliminating barriers to benefits.
- Recommitting to the federal expansion of unemployment benefits to cushion the economic harm as business disruptions grow.
- Enacting paid sick leave and paid family and medical leave.
As COVID-19 cases and hospitalizations begin to rise again across the country, some states are more vulnerable than others. Neighboring states Missouri and Arkansas are in the middle of a serious COVID-19 spike along with Louisiana, Florida, and Mississippi. The number of cases per capita in the two states – about 52 new cases daily per 100,000 residents in Arkansas and 40 per 100,000 residents in Missouri – is more than twice the national average of 19. The seven-day rolling average of deaths in the two states is rising rapidly and is three times the national average. Mercy Hospital in Springfield, Missouri ran out of ventilatorsover the Fourth of July weekend. Hospitals across the state of Arkansas are already reaching maximum capacity – even as a record number of COVID-19 hospitalizations are anticipated in the coming weeks.The new Delta variant of COVID-19, which has caused new lockdowns in Australia and Malaysia and caused some nations to restrict incoming flights from Britain, has spread throughout these two states and is now the most dominant strain of the virus throughout the United States.Both Missouri and Arkansas are lagging behind the country in COVID-19 vaccinations, the primary factor in lowering the risk of hospitalization. Across the United States, 55% of the population has at least one shot, but in Missouri that rate is 47% and in Arkansas 45%. But even those numbers belie the situation in Arkansas’s northern and Missouri’s southern counties – most are below 30% fully vaccinated, and just 17% of Reynolds County, Missouri is fully vaccinated, including just one in three people over 65.
Visitation suspended at Louisiana prisons amid COVID-19 surge – The Louisiana Department of Public Safety and Corrections on Tuesday said it would be temporarily suspending visitation and volunteering at all state-run prisons as Louisiana is reporting record surges in COVID-19 infections among its largely unvaccinated population. The corrections agency announced in a press release that the suspension would remain in place until Aug. 16, at which point the department “will review and reconsider the need for these measures.” The move, which will immediately take effect at Louisiana’s eight state-run prisons, was being taken “out of an abundance of caution concerning the latest surge of COVID-19 positive cases in Louisiana,” the department said. Visits had been reinstated at state prisons in March after a nearly yearlong suspension due to COVID-19 as several prisons across the country recorded virus outbreaks among inmates and staff. As of July 21, there were 26 active COVID-19 infections among Louisiana prison staff, with none recorded among prisoners, according to state data. The Louisiana corrections department said that while the visitation suspension is in place, inmates will continue to be offered two free phone calls per week, with video calling also available for a fee. The department said it “continues to make vaccinations available to all inmates,” with 68 percent of those incarcerated at Louisiana’s state-run prisons already voluntarily vaccinated against COVID-19. “The DOC continues COVID screening with temperature checks and questions for anyone entering the state’s prisons, including staff and vendors,” the department added. “The DPS&C has reminded its staff and inmates on social distancing and hand washing practices to reduce the potential spread of coronavirus.” The announcement comes the same day that Louisiana Gov. John Bel Edwards (D) announced 169 new coronavirus-related hospitalizations in the state, the largest single-day increase since March 2020. The Louisiana Department of Health also recorded 6,797 new COVID-19 cases on Tuesday, the second-highest single-day surge since Jan. 6, when 6,882 cases were reported. Tennessee GOP state senators urge residents to get COVID-19
California to require state employees, health care workers be vaccinated –California on Monday announced that it would be requiring all state and health care workers to either provide proof of vaccination or be tested once a week for COVID-19. “We are now dealing with a pandemic of the unvaccinated, and it’s going to take renewed efforts to protect Californians from the dangerous Delta variant,” California Gov. Gavin Newsom (D) said in a press release. “As the state’s largest employer, we are leading by example and requiring all state and health care workers to show proof of vaccination or be tested regularly, and we are encouraging local governments and businesses to do the same,” he added. “Vaccines are safe – they protect our family, those who truly can’t get vaccinated, our children and our economy. Vaccines are the way we end this pandemic.” Workers at high-risk settings such as hospitals, jails, care homes and homeless shelters will also be subject to these new rules. This new policy will go into effect beginning on Aug. 2. This moves echoes that of New York City Mayor Bill de Blasio (D), who announced on Monday that all city workers would be required to either get vaccinated or undergo weekly testing by Sept. 13 when schools return for the academic year. “Despite California leading the nation in vaccinations, with more than 44 million doses administered and 75 percent of the eligible population having received at least one dose, the state is seeing increasing numbers of people who refused to get the vaccine being admitted to the ICU and dying,” the press release stated, pointing to a sharp increase in new cases that has been observed recently, nearly quadrupling since May.
San Francisco bars to require vaccine proof, negative COVID-19 tests to drink inside – A group that represents nearly 500 bars in San Francisco said on Monday that customers will be required to show proof of vaccination or a recent COVID-19 test showing a negative result in order to drink inside. The group, the San Francisco Bar Owner Alliance, confirmed to NBC News that its members would be implementing the new rules starting Thursday. In its statement announcing the new move, the group said it’s “obligated to protect our workers and their families and to offer safe space for customers to relax and socialize.” The alliance reportedly added that the move came after it saw a number of bar workers come down with coronavirus infections despite being vaccinated. The announcement arrived the same day California said it would be requiring state employees and health care workers to show proof of vaccination or undergo weekly testing for the virus as it works to curb the spread of the disease amid rising cases of the delta variant. “We are now dealing with a pandemic of the unvaccinated, and it’s going to take renewed efforts to protect Californians from the dangerous Delta variant,” Gov. Gavin Newsom (D) said in a press release. “As the state’s largest employer, we are leading by example and requiring all state and health care workers to show proof of vaccination or be tested regularly, and we are encouraging local governments and businesses to do the same,” he said.
De Blasio mandates vaccines or weekly testing for New York City employees –New York City’s entire public workforce will be required to either get vaccinated against COVID-19 or undergo weekly testing beginning on Sept. 13, Mayor Bill de Blasio announced on Monday. “This is about our recovery, this is about what we need to do to bring back New York City, this is about keeping people safe, this is about making sure our families get through COVID OK, this is about bringing back jobs. You name it,” de Blasio said during his daily press briefing. De Blasio cited September as the “pivot point” in the city’s COVID-19 recovery, pointing to how employers will soon begin asking employees to return to offices, people will be returning from summer vacations and the school year will begin in “full strength.” “And so, on Sept. 13, which is the first full day of school, every single city employee will be expected to be either vaccinated, or be tested weekly. This means everybody,” de Blasio said, including all school employees, the New York City Police Department (NYPD), the New York City Fire Department and all other city agencies. The mayor had already announced a similar measure last week for all public city health workers. Soon after this requirement was announced, the NYPD disclosed that it had vaccinated less than half of its police force. At the time, de Blasio said all agencies have “got to do better. We’ve got to go farther.” Beginning on Monday, unvaccinated city employees who are found to not be wearing a mask will be subject to consequences, de Blasio said. “So we’re going to keep climbing this ladder and adding additional measures as needed – mandates and strong measures – whenever needed to fight the delta variant,” de Blasio added. “No. 1 way to fight it is get vaccinated, we’re proving it. This is the reason life is as good as it is in New York City right now because we’re above the national average in vaccinations, but we need to do more.”
De Blasio proclaims ‘voluntary phase is over’ on COVID-19 vaccines – Mayor Bill de Blasio said Tuesday that the “voluntary phase is over” in the effort to administer COVID-19 vaccinations to city workers – hinting that mandatory jabs for the Big Apple’s workforce could come soon.Asked if the city will soon require all city workers to be inoculated, de Blasio said he’s heading in that direction.”Yes, we are climbing a ladder. I’m not answering yes to your question yet,” he said on MSNBC’s “Morning Joe” in response to a question from host Joe Scarborough.”But if that’s not enough, I think we got to be ready to climb the ladder more,” he added. “We’ve got to put pressure on this situation.”On Monday, de Blasio announced that the entire city workforce will soon need to submit to weekly testing if they are not inoculated against the coronavirus. Additionally, city officials said the city, beginning Aug. 2, will require unvaccinated city workers to wear a mask at their workplaces – or face removal from them and suspension without pay. Those new rules came after on Wednesday de Blasio outlined a weekly test-or-COVID-19 vaccine requirement for the city’s public health system workers, amid mounting concern about the spread of the highly contagious Delta variant of the bug in the five boroughs. On Tuesday, de Blasio said enticing New Yorkers with goodies isn’t sufficient to meet the city’s goal of getting more workers inoculated against COVID-19.
New York City and California will require workers to be vaccinated or face testing. – The drive to get Americans vaccinated accelerated on Monday when the most populous state and largest city in the United States announced that they would require their employees to get vaccinated against the coronavirus, or face frequent tests.All municipal employees in New York City, including police officers and teachers, and all state employees and on-site public and private health care workers in California will have to be vaccinated or face at least weekly testing.The Department of Veterans Affairs on Monday also became the first federal agency to mandate that some of its employees get inoculated.The mandates are the most dramatic response yet to the lagging pace of vaccinations around the country in the face of the highly contagious Delta variant, which is tearing through communities with low rates of vaccination and creating what federal health officials have called a “pandemic of the unvaccinated.”Vaccines remain effective against the worst outcomes of Covid-19, including from the Delta variant, but only 49 percent of people in the United States are fully vaccinated, according to federal data.Misinformation and skepticism have dogged the vaccine rollout, too, and in recent weeks new coronavirus infections and hospitalizations have risen, with a fourfold increase in new cases per day over the last month.But both indicators, as well as new deaths, remain well below their winter peaks. Cities, private employers and other institutions have been grappling with whether to require vaccines to help get more people vaccinated.Nearly 60 major medical associations, including the American Medical Association and the American Nurses Association, signed a joint statement on Monday calling for the mandatory vaccination of health care workers that described inoculation as “the logical fulfillment of the ethical commitment of all health care workers.”Hospitals and health care systems like NewYork-Presbyterian and Trinity Health have already announced vaccine mandates, in some cases touching off union protests. The National Football League recently announced it could penalize teams with players who do not get vaccinated. Delta Air Lines will require new employees to be vaccinated, but not its current workers. And last week a federal judge ruled that Indiana University could require vaccinations for students and staff members.New York City will require its roughly 340,000 municipal workers to be vaccinated against the coronavirus by the time schools reopen in mid-September or face weekly testing, Mayor Bill de Blasio said. Enforcing the testing requirement there could be complicated, since the more than two dozen unions that represent municipal employees could take issue with the rule. Mr. de Blasio said the new measures were first steps and that more would follow, and he reiterated a call to private employers to set vaccine mandates for their workers.
State workers in New York must be vaccinated or get weekly tests, Cuomo says. Responding to lagging vaccination rates and a rise in coronavirus cases, Gov. Andrew M. Cuomo said on Wednesday that New York’s tens of thousands of state employees would be required to show proof of vaccination or face weekly testing.The governor also announced a much stricter mandate for state-run hospitals, saying that all “patient-facing” health care workers at those facilities would be required to be vaccinated, without the option of regular testing instead. Mr. Cuomo’s announcement comes two days after Mayor Bill de Blasio announced a similar requirement for New York City’s government work force of 300,000 employees.Much of the nation is grappling with the rapid spread of the Delta coronavirus variant. Earlier this week, Gov. Gavin Newsom of California announced his own requirement that would cover 246,000 state government employees, as well as two million health care workers in the public and private sectors.The North Carolina Department of Health and Human Services will require all workers and volunteers at state-operated facilities to be fully vaccinated or receive an approved medical or religious exemption by Sept. 30, according to a statement sent to The New York Times on Wednesday. Officials did not respond to questions about whether those with exemptions will be required to undergo testing.President Biden plans to formally announce on Thursday that all civilian federal employees must be vaccinated against the coronavirus or be forced to submit to regular testing, social distancing, mask requirements and restrictions on most travel, two people familiar with the president’s plans said Wednesday. Such a policy would be a stark shift for a president who has grappled with the authority he has to force Americans to get vaccinated. Mr. Biden is expected to say more about his plans later this week.The increasing support among government officials for vaccine mandates, which have met with pushback from some unions, underscores their concern with a far more contagious variant that poses a special threat to children, and older and unvaccinated people.”We’re working with our unions to implement this quickly and fairly,” Mr. Cuomo, a third-term Democrat, said during remarks to a state business group on Wednesday.
Puerto Rico’s governor says public employees must get vaccinated or face testing. – Puerto Rico’s governor announced on Wednesday that all public employees in the territory would have to be vaccinated against the coronavirus or face weekly testing, joining a growing list of states, municipalities, companies and the federal government that have imposed some form of vaccine requirement.The governor, Pedro R. Pierluisi, said on Twitter that government employees must get their first shot by Aug. 16 and be completely inoculated by Sept. 30, though exceptions for religious reasons or disabilities will be allowed.On Thursday, President Biden announced in Washington that all civilian federal employees in the United States must be vaccinated or submit to regular testing, social distancing, mask requirements and restrictions on most travel.In recent days New York, California and North Carolina have all announced similar vaccination requirements for their employees, as has the Department of Veterans Affairs. Google, Facebook andThe Washington Post are among the companies that have announced mandates of their own.The pace of vaccinations has declined dramatically since they peaked in April, and just under half the country is fully vaccinated, according to data from the Centers for Disease Control and Prevention. Some communities with low rates of vaccination have seen soaring case rates and hospitalizations in recent weeks, due in part to the highly contagious Delta variant. Mr. Pierluisi’s mandate is in response to a sharp increase in known coronavirus cases in Puerto Rico – the island saw a 311 percent jump in daily cases over the past two weeks, the most of any U.S. state or territory, according to a New York Times database.
California Restaurant Requires “Proof Of Being UNvaccinated” For Service – A restaurant in Huntington Beach, California is requiring that patrons show proof they’re unvaccinated before they can receive service.”PROOF OF BEING UNVACCINATED REQUIRED,” reads a sign taped to the window at Basilico’s Pasta e Vino, according to NBC LA.”Our American way of life is under attack,” wrote owner Tony Roman in a statement to NBCLA. “And I feel blessed to be on the front lines of this battle in defense of Liberty and Freedom, willing to put everything at risk for it, pledging our business as a ‘Constitutional Battleground’ since day one of the lockdowns on March 19th, 2020.””We have never complied with any restrictions since, and when the tiny tyrants go on the attack with new mandates, we fire back launching new missiles of defiance. And with the new and aggressive push for mandatory vax policies, we couldn’t resist, so we are sending a message of our own. Hopefully most are smart enough to read between the lines. Otherwise we will just sit back and have fun watching their heads explode over it.”It’s unknown how Roman verifies a customer is indeed unvaccinated, however he declared it a ‘mask-free zone’ and remained open in March 2020 when other restaurants were on lockdown.The report comes amid a Tuesday admission by the Biden administration that vaccinated people can still contract and transmit COVID – while the Daily Mail reported last week that one fully-vaccinated Australian man infected at least 60 people in a single weekend.
Conflicting school mask guidance sparks confusion —Conflicting mask recommendations and orders from all levels of government and advocacy groups have emerged over the past few weeks, flustering the public as back-to-school season approaches. Confusion is mounting over whether children should wear masks in school and whether their vaccination status should play a role in any guidance ahead of next month, when many schools plan to fully reopen for in-person learning. President Biden addressed the debate this week, saying during a Wednesday town hall that he expects the Centers for Disease Control and Prevention (CDC) to urge unvaccinated students to wear masks in schools and to continue to advise vaccinated students that they don’t need masks. “The CDC is going to say that what we should do is, everyone under the age of 12 should probably be wearing a mask in school,” Biden said at the town hall, as those under 12 years old are currently ineligible to get vaccinated. But the American Academy of Pediatrics issued contradictory recommendations days before, calling for all students older than 2 to wear masks in school, regardless of their vaccination status. The organization said many students can’t get vaccinated and that most schools are not planning to track the vaccination status of the children, although it noted that it “strongly recommends in-person learning.” Mark Schleiss, a professor of pediatrics at the University of Minnesota Medical School, supports requiring masks for all children despite their vaccination status, saying that children make up an increasing percentage of new cases as more adults and seniors are vaccinated. “We need to value and cherish the lives of these kids,” he said. “This idea that children are resistant to COVID-19, that they don’t have serious disease with COVID-19 is – I’m so tired of hearing that because it’s just simply not true.” The CDC has documented almost 500 deaths among children during the pandemic. He also pointed out that creating rules based on vaccination status could “single certain kids out” and put an “onerous burden” on schools to verify that status. In the meantime, states and cities are taking matters into their own hands by announcing different school mask recommendations and mandates, leading to a patchwork of rules across the country. This week, Chicago, Boston and Washington, D.C., announced plans to require all students to wear face coverings in school in the fall. Meanwhile, at least nine states, including Florida and Texas, so far have banned school districts from requiring masks in schools, according to a CNN analysis.
Florida’s governor gives parents final say on masks for children in school. – Defiant in the face of new federal mask recommendations, Gov. Ron DeSantis of Florida on Friday signed an executive order directing state officials to ensure that parents have the power to decide for themselves whether their children wear masks in school this fall.Mr. DeSantis, a Republican who has made freedom from Covid-19 restrictions a signature part of his administration, announced that he would sign an order “protecting the rights of parents” amid an intensifying national movement to control the pandemic, as a highly contagious Delta variant of the virus rips through the unvaccinated population.”In Florida, there will be no lockdowns,” Mr. DeSantis said to cheers at a restaurant in Cape Coral, Fla. “There will be no school closures. There will be no restrictions and no mandates.”The announcement came after Broward County, the second largest school district in Florida, voted this week to require masks in schools. The Centers for Disease Control and Prevention had alsorecommended that all students, teachers and employees wear masks, regardless of their vaccination status.Mr. DeSantis called for a stop to school mask mandates and said that the decision should be in the hands of parents, not school or health officials.His order directed state agencies to ensure that school safety protocols do not interfere with parents’ rights to make health care decisions about their children and empowered the state commissioner of education to withhold state funding from school districts that do not comply.The issue of masking in schools is particularly potent in Florida, which is experiencing one of the fastest Covid-19 outbreaks in the country and where hospitals are once again filling up with coronavirus patients. In Jacksonville, hospitals have more Covid patients than ever before, despite the availability of vaccines. Less than half of the Florida population is fully vaccinated, and children under 12 are not yet eligible for the vaccine.
Biden facing renewed push from Dems to cancel $50K in student loan debt per borrower, extend payment freeze – A group of prominent Democrats on Tuesday once again urged President Joe Biden to extend the federal student loan payment freeze and to forgive $50,000 in student debt per borrower through an executive order. At a joint news conference, Senate Majority Leader Chuck Schumer, D-N.Y., Sen. Elizabeth Warren, D-Mass., and Rep. Ayanna Pressley, D-Mass., urged Biden to use his executive authority to make these changes. Currently, federal student loan payments are set to begin again in October but Pressley said the recent spike in COVID-19 Delta variant infections justifies pushing the date out further.”We urge President Biden to act with urgency,” Pressley said at the news conference. “Failure to act would be unconscionable, would undermine our economic recovery.”Even if the Biden administration decided to take action, such measures wouldn’t help private student loan borrowers because they are not eligible for COVID-19-related federal student loan forbearance and also wouldn’t qualify for forgiveness. However, there are still options available to them, such as refinancing their student loans. Refinancing could help borrowers save on their monthly payments by getting a lower interest rate. Visit Credible to find your personalized rate.This isn’t the first time Democrats have called for an extension to the student loan payment freeze. Previously, Democratic lawmakers sent a letter to Biden with the results of their inquiries to student loan servicers, showing many were concerned about their ability to end student loan forbearance.Now, lawmakers are renewing that call. “Should payments resume on Oct. 1, millions of students, borrowers and parents will be abruptly pushed back into repayment at the same time, even those who are living paycheck-to-paycheck or without paychecks at all,” Schumer said at the news conference. “This could stall our economic recovery and bring millions of student loan borrowers to the edge of a financial cliff.”If Biden extends the federal student loan payment freeze or decides to cancel any amount of student loans, private student loan holders will not be eligible for these benefits.
With student debt forgiveness uncertain, Biden is urged to extend loan freeze – As things stand now, the pandemic-triggered freeze on federal student loans will end on Sept. 30.Many Americans aren’t ready to come face to face with their student loan obligations for the first time since March 13, 2020. Oct. 1 will mean not only the return of interest charges and monthly payments, but also collections of student loans in default.A push is on for President Joe Biden to extend the payment holiday beyond the end of September. That would give borrowers more time to prepare, and pay off other debt – and it would provide Democrats with additional time to press Biden for broader relief.Many members of the president’s party still want him to wipe out $50,000 in student debt for every borrower, though there’s new disagreement over how far he might be able to go. For student loan borrowers, Halloween won’t be the scariest day in October this year. A new survey shows many are dreading Oct. 1 and the end of the long student loan payments holiday that has already been extended three times.More than 4 in 10 borrowers (41%) say they’ll “barely get by” when the freeze expires and will have to cut spending to make ends meet, U.S. News & World Report found. About a quarter (23%) say they won’t be able to resume their payments without finding a new source of income.Roughly a quarter of borrowers report they’re paying back $10,000 or less, but 30% say they owe more than $30,000, and 11% say they’re paying off student loan balances of more than $50,000, according to the U.S. News survey.The financial burdens are keeping double-digit percentages of borrowers from getting married, or buying homes at today’s historically low mortgage rates.Those who are praying for a longer break from student loan payments and interest have some powerful allies in their corner.In June, 64 Democrats in Congress, including Senate Majority Leader Chuck Schumer and Massachusetts Sen. Elizabeth Warren, urged President Biden in a letter to extend the moratorium until either March 31, 2022 – or a time when employment returns to its pre-pandemic levels.
Kuwaiti government bans unvaccinated citizens from traveling outside country – The Kuwaiti government announced on Tuesday that only vaccinated citizens will be permitted to travel outside the country beginning on Aug. 1. Children who are younger than 16 years old, individuals with a certificate from the health ministry saying they cannot be inoculated and pregnant women who have a certificate from authorities that proves they are carrying a child are the only groups of people exempt from the new regulations, Reuters reported. The civil aviation authority also announced on Tuesday that all individuals who arrive in Kuwait must present a negative COVID-19 PCR test and be symptom free before boarding flights, Reuters reported. If the arrivals do not provide a negative COVID-19 PCR test in Kuwait, they will reportedly have to complete a seven-day home quarantine. The new restrictions come one day after the Kuwaiti government scaled back some COVID-19 restrictions and restarted all activities except for gatherings such as conferences, weddings and social events, according to the wire service. Infections, however, are beginning to creep up throughout the world, driven largely by the highly infectious delta variant. In Kuwait, according to the World Health Organization (WHO), new daily cases steadily increased last month before decreasing in June. Kuwait has seen more than 393,000 COVID-19 cases since the pandemic began, according to the WHO. More than 2,200 people in the country have died.
Brazil’s schools set to reopen amid record COVID-19 child deaths – Last week, a news report by UOL revealed that COVID-19 became the number one cause of death among 10-to-19-year-olds in Brazil. Just in the first six months of 2021, 1,581 young people in this age group died from COVID-19. In contrast 1,406 died from cancer in the entire year of 2019. The death toll of younger children is also alarming, with Health Ministry data showing that 1,187 children younger than 10 died from COVID-19 in 2020. However, data from Vital Strategies, which takes into account the surge in deaths from Severe Acute Respiratory Syndrome (SARS), points to 3,129 lives lost. Epidemiologist and professor at the Sergipe Federal University Paulo Martins-Filho said that “this increase in the number of hospitalizations and deaths from COVID-19, observed particularly since February and March, is a reflex of the high community transmission rate and the circulation of variants of concern in the national territory.” He added that “For children, the pandemic was also associated with profound educational, social and psychological changes, food insecurity … which can result in death in poorer regions.” He concluded that “the disease emerged as a new cause of death among children in poor communities, as observed in the North and Northeast regions in Brazil.” In an interview with CNN Brasil, Ana Escobar, a pediatrician from the University of Sao Paulo said that the Gamma variant, which originated and became the dominant variant in Brazil in the first months of the year, was a direct cause for the deadly disease spreading among young people. She explained that it is able to more easily enter cells in the body, while warning of the potential of a new surge in deaths that won’t spare children and teenagers: “the Delta variant, which is already in the country, is even better at it.” In Brazil, the COVID-19 pandemic continues to cause more than a thousand deaths every single day, while the moving average is again on the rise, registering 45,094 daily cases. Sunday, vaccinations with first shots were suspended in eight state capitals, pending the delivery of new vaccine batches by the federal government. Meanwhile, state governors, including those of the Workers Party (PT) and Maoist Communist Party of Brazil (PCdoB), are signaling their support for the profit interests of the ruling class by touting the vaccination of small percentages of the population while reopening schools and the entire economy. Maranhao Governor Flflvio Dino of the PCdoB announced last week the beginning of in-person classes on August 2, along with the full reopening of theaters, churches, commerce and mass events. He justified his measures stating that “We have the mask mandate and social distancing. This is as critical as the vaccine. From this premise … we are flexibilizing economic activities.” Meanwhile, Governor Rui Costa of the PT followed the same line, while threatening Bahia’s state teachers that they will have their wages cut if they refuse to enter schools.
Europe recovers from double-dip recession but lags the United States -Europe’s economy exited a painful double-dip recession in the second quarter, rebounding faster than expected from the ravages of the pandemic as consumers spent pent-up savings and restaurants, factories and other businesses sprang to life after pandemic control restrictions eased.Gross domestic product, the broadest measure of economic output, grew 2 percent in the second quarter of the year in the eurozone, up nearly 14 percent from a year ago and reversing a 0.3 percent contraction in the first three months of the year, Eurostat, Europe’s statistics agency, reported on Friday.But the eurozone’s recovery, while striking for its speed, is far from complete: It continues to lag the United States, which reported data Thursday showing it had returned to its prepandemic level of output in the second quarter. Europe is not expected to hit that marker before the end of the year.The European Union recently increased its forecast for growth this year to 4.8 percent, but the United States economy is expected to grow by 6.9 percent in 2021, according to the Organization for Economic Cooperation and Development. Nonetheless, Europe’s recovery has gained speed as service and manufacturing sentiment and activity jumped among the 19 nations that share the euro currency, after governments worked to prevent new lockdowns in spring. …
Fall in UK daily COVID cases used to reinforce government propaganda that everyone can “live with the virus” – UK Health Minister Sajid Javid was forced to delete and then issue an apology for a tweet he had posted Saturday declaring that the public must not “cower” from COVID-19, but instead learn to “live with” the virus. Javid tweeted the comments after stating that he had contracted COVID and made a “full recovery” from it.At least 152,000 people in the UK made no recovery from COVID and lost their lives to the Conservative government’s herd immunity policy. Javid now denounces as “cowards” those seeking to protect themselves and others from the ravages of the virus, amid his government’s “Freedom Day” elimination of mandatory containment measures.Javid’s comments met with a wave of protest from those who have lost loved ones. But his original tweet was repeating, more crudely, statements he has made consistently from the moment he was appointed health secretary last month. Even as he forecast that within months Britain’s population could be hit by more than 100,000 infections a day, Javid tweeted July 4, eight days after taking office, “We are going to have to learn to live with Covid and find ways to cope with it – just as we already do with flu”.This too was an unvarnished declaration of the government’s “herd immunity” policy. Last Friday, Prof Robert West, a health psychologist at University College London who participates in the behavioural science subgroup of the government’s Scientific Advisory Group for Emergencies (SAGE), said, “What we are seeing is a decision by the government to get as many people infected as possible, as quickly as possible, while using rhetoric about caution as a way of putting the blame on the public for the consequences.””It looks like the government judges that the damage to health and healthcare services will be worth the political capital it will gain from this approach.”
UK’s economic recovery from Covid stalled in June amid ‘pingdemic’ – Britain’s recovery from the pandemic slowed last month as shortages of goods supplied to factories, building sites and shops began to take their toll on growth and increasing numbers of workers across the country were forced to isolate after being pinged by the NHS app.According to the Guardian’s monthly snapshot of economic developments, there was a slowdown in economic growth in June, which could continue if the Delta variant continues to hamper business activity.Construction companies reported a second month of declining activity as the combined impact of EU staff returning home following Brexit and a shortage of materials hit their ability to maintain previously high levels.Overall retail footfall in mid-July was three-quarters of the level recorded in the equivalent week of 2019, prior to the pandemic, reflecting continued caution among shoppers as Covid infection rates remained high. Financial markets took a dive last week in response to concerns that governments were struggling to suppress the Delta variant and fears the highly contagious strain of the coronavirus would persist into the autumn.A more recent improvement in the infection rate following a halving of reported cases in the UK helped markets recover some losses this week. But analysts said the Bank of England’s monetary policy committee (MPC), which meets next week to set interest rates, was likely to maintain its base rate at the historic low of 0.1% over fears that the virus could flare up again.Central bank policymakers are divided about the likely path of the recovery, with deputy governor Sir Dave Ramsden and external member Michael Saunders, a former City economist, saying it was time to begin withdrawing the Pound Sterling150bn stimulus injected into the economy this year as part of an Pound Sterling875bn quantitative easing programme.However, a majority of the nine-strong committee have argued in separate speeches for the plan to remain in place, leaving little doubt that the central bank’s policy of low interest rates and QE will persist following next week’s meeting.
UK teachers’ pay freeze meets no opposition from unions – The Conservative government has announced a pay freeze for teachers in England along with that proposed for all public sector workers, excluding the paltry 3 percent offered to some National Health Service (NHS) staff. The announcement has angered many teachers who will be confronted with a real term loss of income following inflation of over 3 percent for this year alone. The government has utilised the massive bailout of the financial elite and major corporations during the pandemic as a justification to impose the real term cuts on wages and conditions, insisting on the need for “restraint”. A government spokesman said, “The pause to most public sector workforce pay rises ensures we can get the public finances back onto a sustainable path after unprecedented government spending on the response to Covid-19.” This is meeting no opposition from the Labour Party or the education unions. While many educators have labelled the announcement as a “slap in the face”, no action is being called by unions that have subordinated all opposition to the terrible impact of the pandemic on the safety and well-being of staff to the need to protect profits. They played the key role in the repeated reopening of unsafe schools, resulting in an explosion of Covid infections in the wider community. According to the Times Educational Supplement (TES), next year’s pay freeze will result in a real-terms pay cut for experienced teachers of around 8 percent, taking teacher pay back to levels of 15 years ago. The calculation by the Institute of Fiscal Studies (IFS), shows the drop in real-term pay for less experienced teachers is also about 4-5 percent lower than in 2007, just before the global financial crisis. Luke Sibieta, IFS research fellow, said, “It is astounding that teacher pay levels remain so far below what they were before the financial crisis in 2007.” The crash precipitated a decade of slash and burn of working conditions and social devastation for the working class internationally through the programme of austerity. The financial impact of the pandemic by the bourgeoisie and its defenders in the corporatist trade unions is meeting the same response. The pay freeze will further hit teacher recruitment, which has been in crisis for well over a decade. The National Association of Head Teachers (NAHT) issued a statement noting that its own survey research “has found that nearly half of school leaders are considering leaving the profession sooner than originally planned.”
NHS Queen Elizabeth Hospital held up by props as national maintenance bill reaches Pound Sterling9 billion – The Queen Elizabeth Hospital (QEH) in King’s Lynn in the East of England is appalling proof of the state of the National Health Service (NHS) in the UK. It is having to bid for government funding to survive.The hospital opened in 1980 and was cheaply built as a “best-buy hospital” from prefabricated sections, only meant to last 30 years. Over the decades it has become a major hub for around 250,000 people in the communities it services. The hospital currently provides 515 beds for an area of approximately 1,500 km2 encompassing the West Norfolk area, South Lincolnshire and North East Cambridgeshire.It has now been standing for over 40 years and is in dire need of replacing. An anonymous trust employee said that the situation at the QEH is like a “Grenfell waiting to happen”.The horrific state of the building is such that there are temporary supports (acrow props) holding up the roof in wards. There are now a staggering 194 props holding up the hospital, after a further 60 had to be installed April. Some wards have had to be closed due to structural safety concerns. The roof was originally built with reinforced autoclaved aerated concrete (RAAC) planks, which only have a lifespan of 30 years, and is now showing cracks. The planks cannot bear the weight of the roof. The hospitals risk register in March 2020 stated that “there is a direct risk to life and safety of patients, visitors and staff due to the potential catastrophic failure of the roof structure due to structural deficiencies.”
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