Archive for July 2020

The Friday File: the longest reigning monarch was France’s Louis XIV. He ruled from 1643 to 1715, 72 years and 110 days. Thai King Bhumibol Adulyadej who ruled from 1946 to 2014, a period of 70 years and 126 days follows and just beats out Prince Johann of Liechtenstein who ruled from 1858 to 1929,…

In 20Q2, GDP declined by a whopping -9.5%, the worst quarter since record keeping began in 1947, probably the worst quarter ever. Since 1947, the worst contraction had been 2.6% in 58Q1. GDP began recovering in May and June, reducing the massive 20Q2 decrease. Even if there is no improvement in GDP during Q3, 20Q3…

Evidence suggests workers with more generous unemployment benefits are slightly more likely to have higher unemployment rates and return to prior jobs at slightly lower rates than those with less generous benefits. The certainty of higher benefits through 12/31/20 could increase these trends. However, with 32 million unemployed and just 5.4 million job openings, the…

With its recent rapid romp to over $1,900/oz, gold has easily surpassed the 2011 peak of $1,815/oz. In real terms, gold remains 5% below its 2011 high, and almost 50% below its 1980 peak. Why the melt up? Low interest rates, inflation fears as the Fed’s balance sheets skyrockets, a weakening dollar making gold cheaper…

Researchers believe Sar-Cov-2 kills between 0.5%-1% of those who contract it, and the number of US deaths is 150,000. Using the midpoint suggests 22.5 million persons in the US have or have had Covid-19. Separately, 4.2 million persons have tested positive for Covid-19, and serological research suggests case counts are 6 to 24 times higher…

The Friday File: While the lifespan of women living in, for example, the US averages 81.1 years vs. 76.1 for men, why is debated. A new theory suggests sex chromosomes. Across mammals, birds, reptiles, amphibians, sharks, bony fish, arachnids, and insects, the heterogametic sex (the one having an X and a Y chromosome) has a…

For the week ending 7/18/20, first time unemployment claims rose 109,000 to 1,416,000, the first rise in 16 weeks, and claims remain well above the pre-pandemic high of 695,000 in 1982. Yet, continuing claims keep declining and at 16.2 million are down 1.1 million from the week before. So, layoffs are being more than offset…

In past recessions, it has been manufacturing that drove the economy into recession, as households stopped buying cars, houses, and refrigerators while services like eating out and going to movies ameliorated the situation. This recession, it is reversed. Service activity has largely collapsed while manufacturing is quickly recovering. This is because of stepped up household…

In the short run, keeping employees attached to their employers through the PPP and other such schemes is reasonable. However, the slower the economic recovery, the less helpful this strategy. That is because the weaker the revival, the deeper the structural changes to the economy. In this case, we must encourage the movement of workers…

In May, retail sales including autos and food jumped 18.2% M-o-M and in June they jumped another 7.5% M-o-M and are now up 1% Y-o-Y! A V-shaped recovery, albeit one aided by substantial government support. Similarly, housing starts jumped 8.2% in May M-o-M and another 17.3% in June M-o-M and are now down 4% Y-o-Y…