The warmer weather has calmed nerves pertaining to the coronavirus, however it appears that the early fatality estimates of 100,000 will be correct. The other disturbing aspect will be the 1.5 million cases in the US and probably, 5 million worldwide. The real sad aspect of this virus will be the severe hit to our economy and to the global economy. In our small world as individuals, we only are aware of how the virus effects us. If you lost your job, this is not a recession, but a depression. If your job was not effected like a police officer and your health is fine, you might think all this is an overreaction? It isn't.
Work behind the scenes
There are many groups and firms out there that seek data like Cambridge Analytica, who sold our privacy data to Facebook. There are many others like Salesforce, Cloudera and Teradata. Sometimes we catch a break and are privy to this info. I have two which will shed some light on the darkness of this disease.
According to James Beard Foundation as many as 80% of restaurants that are currently closed, may never reopen. Dear Reader, there are 16 million people who are employed in this field.
A poll conducted by Weiss, an investment firm asked small business owners if they expect to fold before the end of the year. 52% said, "YES!" This represents another 16 million companies to which many more thousands of jobs will be lost along with their production and lost of revenue for local government. In addition, whomever supplied them with items that were necessary to produce a product will see this shrinkage in demand. This is how all things are connected.
Related aspect...
Black Knight reports that 3.8 million homeowners are one month or more behind in paying their mortgage. We will get a government report on this come Monday. This could confirm, reject or get worse. Sorry. The data is a lagged stat. There isn't a revealed figure for 2020. Nevertheless...
The other financial problem is the 40 million of us who rent. The call for rent strikes is being heard and small landlords fear their little empire could be crushed as they receive from Peter (renters) to pay Paul (banks). US households are holding record debt of 14.3 trillion and many are adding to this by borrowing from their credit cards to pay rent, utilities and purchase food. There are millions of people out there who are entitled to unemployment and as of yet, they have not received one check. It gets worse when you read the garbage put out by the Labor Bureau concerning the unemployment numbers. They say unemployment is 14.7%. It is ten points higher!
This does not mean that they put out lies. It is like the old expression, "Garbage in, garbage out."
For example, Florida has a population of 21.67 million. It is the 3rd largest state by population. Now, follow this thinking. Florida put out its unemployment figure last week. It says that it has only 416,000 unemployed. This is pure BS! Why, you ask? Because if the labor department is correct with 33 million citizens being unemployed, this comes to a one in five ratio. Now, go back to Florida's report. Let's say one-half of Florida's population was working. Using the same ratio, we arrive at 2 million plus unemployed. That should be the minimum figure. It is probably way, way more. Florida is a service state with its jobs. It relies on tourism. Orlando is the tourist capitol. It has Disney, Universal and Sea World. They are all closed! The reason for the phony report of 416K is because no one can get through to the unemployment office to file a claim. The other side of the picture is the staff at Florida's office is understaffed. You get the same stories all across the nation and most notably, from Red States. The one report that the labor department had right concerned truckers. These over-the-road haulers move 70% of merchandise. The report says 88,300 truckers were laid off. People, it gets worse as the disease has already claimed the following firms. Going out of business signs are being posted on a daily occurrence. Keep in mind that every company employs thousands and yet, the stock market keeps climbing. They are wrong and coming, very soon will be a record down day in the market as they take their blinders off.
Bankruptcy Call (so far for 2020):
Diamond Offshore Drilling Eco-Stim Energy Solution
BlackRidge Technology International Whitney Petroleum
Real Good Solar Foresight Energy
Valeritas Holdings United Cannabis
J. Crew LSC Communication
Pier I Imports McClatchy
McDermott International Stealth Technologies
Globe Photos Pioneer Energy Services
Frontier Communications Omagine
Yuma Energy Generation Zone
Carbo Ceramics Broad Vision
Quorum Health Neiman Marcus
Helios and Matheson Analytics Souplantation
many, many more to come...
Litigation Nation
Ambulance chasers are out in full force. When the danger of the virus passes, the new danger of lawyers will be even more disastrous. There will be suits against hospitals, governors, the president, manufacturers and any business that remained open with sick people on site. The list and reasons will be as long as the number of cases which are well over a million. There are already cases where pastors versus their state. Nurses and retail workers for not providing a safe workplace. College students seeking reimbursement of tuition for cancelled classes. Insurance firms that sought ways out of paying claims. Airlines for not refunding ticket costs due to canceled flights. Sport vendors due to cancelled games. The CARES Act because it declares that their loans are forgivable and yet, banks seek payment. How about this one? Illegals are suing for stimulus checks for their children who were born in the US which makes them citizens. They want a check!
The stock market has yet to realize this aspect. Just like the government, they cannot see farther than their nose. The only good news that I have to offer is this: the night is followed by dawn...Peace.
