Jump to content
Sniper

Second-quarter GDP plunged by worst-ever -32.9% amid virus-induced shutdown

Recommended Posts

15 minutes ago, Sniper said:

 

Interesting, I see multiple recession lines on those three charts I posted?  :scratchhead:

Thats not what I meant, you are pointing to the 2008 recession, and making observations about it, and as i read it seemed like youre applying the same standard to all recessions. Plenty of recessions in US history show very healthy recoveries in short time, as not a single one shares the same liability or recovery strategies. 

I dont disagree with current economic outlooks, we are in a self-destructive pattern, not new to the pandamic.. which is normal. The fabricated economic disaster due to the pandemic has the potential to create a very bad depression. In a year where a normal recession was predicted.. it can only mean worse.

Share this post


Link to post
Share on other sites
1 hour ago, JackDaWack said:

Thats not what I meant, you are pointing to the 2008 recession, and making observations about it, and as i read it seemed like youre applying the same standard to all recessions. Plenty of recessions in US history show very healthy recoveries in short time, as not a single one shares the same liability or recovery strategies. 

The only way to compare things is to look back in history to other similar incidences. Past recessions all vary, in the length and recovery. If you recall, the last one in 2008 was called the "Great Recession", because it was way worse than many past ones. So, if the one in 2008 was considered bad, and you compare the current downturn to those numbers, what do you call THIS recession?

Share this post


Link to post
Share on other sites

https://www.marketwatch.com/amp/story/new-york-city-is-dead-forever-according-to-one-lifelong-new-yorker-2020-08-16

A very interesting article and perspective of dying cities due to the fallout of recent reactions to the virus. If the statistics are correct, our most valuable areas of commerce will be empty, and an economic recovery will be extremely difficult. There are many low skilled jobs gone that cant be recovered without new businesses, in a place that won't need them. 

My only question is, where are these people all moving to? Will their new locations have an increase for demand in services/business? Or will only existing business benefit? Most surrounding areas are already saturated with people. 

I'm hearing a lot of talk from people wanting to move to red states, about going WFH indefinitely. Could the destruction of cities be another ploy to water down red votes in suburbs?

Chicago has had a very similar experience. And I'm shocked it took this long, but the criminal elements that seem to run this city are scaring off all the productive liberals. 

Share this post


Link to post
Share on other sites
41 minutes ago, JackDaWack said:

https://www.marketwatch.com/amp/story/new-york-city-is-dead-forever-according-to-one-lifelong-new-yorker-2020-08-16

A very interesting article and perspective of dying cities due to the fallout of recent reactions to the virus. If the statistics are correct, our most valuable areas of commerce will be empty, and an economic recovery will be extremely difficult. There are many low skilled jobs gone that cant be recovered without new businesses, in a place that won't need them. 

My only question is, where are these people all moving to? Will their new locations have an increase for demand in services/business? Or will only existing business benefit? Most surrounding areas are already saturated with people. 

I'm hearing a lot of talk from people wanting to move to red states, about going WFH indefinitely. Could the destruction of cities be another ploy to water down red votes in suburbs?

Chicago has had a very similar experience. And I'm shocked it took this long, but the criminal elements that seem to run this city are scaring off all the productive liberals. 

All areas of the residential real estate market in this state are booming as those that used to live in NYC and Philly are getting out before they get trapped in their apartments again.  NJ 101.5 had a long discussion of this multiple times a day.  Those who called said what I stated above, addind that they can do most of their work from home anyway.  My next door neighbor is in that boat.  He's not planning to go back to Manhattan until at least January.  Loves not commuting 1.5 hours each way.

Share this post


Link to post
Share on other sites

Is seven years enough time to show a recovery form a recession? Often, but not always. What went on to cause the 2007 recession was similar to what caused the lost decade in Japan in terms of money creation and destruction. It was actually probably worse in terms of the fundamental impacts, globally, on the banking infrastructure. 

While going by the stock market, we had a big rally and then moved sideways for a couple years before stepping in the giant pile of dogshit that is 2020. However in terms of jobs and just general quality of life it looked like we were finally getting a proper recovery.  Like unemployment out-competing a lot of jobs for compensation. 

Will we get a depression? Possibly. A lot of damage was done. However a lot of numbers are being inflated by unprecedented intervention. Heck, I still get spammed with realtor housing reports after my last refi, and they went from forecasting -1.6% housing prices in the next 12 months to 2.2%. I can tell you almost all the inventory went poof. In a town of 50k+ people, last I looked we had all of 24 homes listed. did that contract because of people fleeing NYC? People shifting form trying to sell to strategic default? Both? 

My 401 went from being in the negative to being up 5% for the year.

And like it or not, the fed and the government are moving to embrace modern monetary theory. Not the lefty, you can print money for everything until everyone is rich misunderstanding of it, but more so the textbook understanding. Which is that so long as your printing doesn't create additional available money, or inflation is a desired outcome, then you can print up money and not care about debt.  

The government seems ot be happy to do it where there is a lot of destruction of money going on. QE and the UEI bailout are examples where it hasn't seemed to create widespread inflation. 

It's some weird shit going on.  It'll likely get weirder. 

  • Agree 1

Share this post


Link to post
Share on other sites
50 minutes ago, raz-0 said:

 

It's some weird shit going on.  It'll likely get weirder. 

That's for sure. Very hard to predict long term finacials including inflation. 

Its very interesting to see a major split in economic conditions. It seems that while many people are defaulting on their mortgages, a large number of people are out buying houses.

And to see a busting city like NYC crash, its primary cash flow apparently is Broadway, i never knew this, and they arent even predicted to go back to full operations within the next year. That alone pulls in tons of money for other business in the area when people make day trips. 

43 minutes ago, RUTGERS95 said:

NYC people are heading to NNJ and CT. 

I'm not worried about recovery as the cities are only service based and that will transplant with demand.  Articles are not very well researched imho

I agree to an extent, services will move to where they are needed, but i wonder if outside a city certain services will even have demand.

Share this post


Link to post
Share on other sites
17 minutes ago, JackDaWack said:

That's for sure. Very hard to predict long term finacials including inflation. 

Its very interesting to see a major split in economic conditions. It seems that while many people are defaulting on their mortgages, a large number of people are out buying houses.

And to see a busting city like NYC crash, its primary cash flow apparently is Broadway, i never knew this, and they arent even predicted to go back to full operations within the next year. That alone pulls in tons of money for other business in the area when people make day trips. 

I agree to an extent, services will move to where they are needed, but i wonder if outside a city certain services will even have demand.

of course they will.  An exodus isn't overnight overloading any one particular area.  Big cities are fked

Share this post


Link to post
Share on other sites
1 hour ago, raz-0 said:

Is seven years enough time to show a recovery form a recession? Often, but not always.

The normal business cycle is like 6 years, so yes, 7 years is way enough time for a recovery. It should happen in only a few years.

Obama's recovery ran from 2009 to 2014, and the only way it happened is because the Fed dropped interest rates from around 5% to near zero. The Fed also printed over $4 Trillion in different QE programs, which juiced the market. Once the QE stopped in the end of 2014, the market and economy moved sideways for two years, until Trump won.

1 hour ago, CMJeepster said:

All areas of the residential real estate market in this state are booming as those that used to live in NYC and Philly are getting out before they get trapped in their apartments again.  NJ 101.5 had a long discussion of this multiple times a day. 

Actually, in NJ, Single Family Listings and Sales are down YTD compared to last year. Listings are down -25%, Pending Sales down -5% and Closed Sales down -13%. What isn't down is prices, they are up +8%, due to limited inventory.

http://njar-public.stats.10kresearch.com/docs/lmu/x/EntireState?src=map

 

Share this post


Link to post
Share on other sites
11 minutes ago, Sniper said:

 

Actually, in NJ, Single Family Listings and Sales are down YTD compared to last year. Listings are down -25%, Pending Sales down -5% and Closed Sales down -13%. What isn't down is prices, they are up +8%, due to limited inventory.

http://njar-public.stats.10kresearch.com/docs/lmu/x/EntireState?src=map

 

I cant remember where I was reading it, but its an indication that people aren't selling their homes due to economic uncertainty, in a way people are battening down the hatches. With the influx of buyers, inventory is down, demand is up, and prices are inflated. I know of only a few people taking advantage of selling shore houses for a nice profit, while unloading the financial liability if we have a bad recession. 

When things, if things, go back to normal and people realize how terrible commuting in NJ is, its gonna be interesting to see what happens. If people start selling mid recession there will probably be some great deals to find. 

 

Share this post


Link to post
Share on other sites
3 hours ago, JackDaWack said:

I cant remember where I was reading it, but its an indication that people aren't selling their homes due to economic uncertainty, in a way people are battening down the hatches. With the influx of buyers, inventory is down, demand is up, and prices are inflated.

Also remember, if you sell your home NOW at a inflated price, your next house's price will also be inflated. Add in the uncertainty of employment, and not many will put their house on the market, unless they have to. Also, there's still over 30 million who've been unemployed since March, and foreclosure moratorium expired, so I expect some fire sales in the near future.

Share this post


Link to post
Share on other sites
37 minutes ago, Sniper said:

Also remember, if you sell your home NOW at a inflated price, your next house's price will also be inflated. Add in the uncertainty of employment, and not many will put their house on the market, unless they have to. Also, there's still over 30 million who've been unemployed since March, and foreclosure moratorium expired, so I expect some fire sales in the near future.

Not a bad time if your looking to head somewhere away from NJ. 

  • Like 1

Share this post


Link to post
Share on other sites
2 hours ago, JackDaWack said:

Not a bad time if your looking to head somewhere away from NJ. 

That actually might be a good idea for some. Take the profits now, while prices are high. Based on this report, they might not stay up.

......"Fast forward to today, when the dam of pent up mortgage delinquencies cracked some more, with the Federal Housing Administration reporting that its mortgages which represent the affordable path to homeownership for many first-time buyers, minorities and low-income Americans, now have the highest delinquency rate in at least four decades.

The share of delinquent FHA loans rose to 15.7% in the second quarter, up a whopping 60% from about 9.7% in the previous three months and the highest level in records dating back to 1979, the Mortgage Bankers Association said Monday."

Being that many of these FHA loans are 3% downpayment, how many people will just walk away, since they have very little skin in the game? I track the houses sold in my area, and many are 3% FHA. It's rare to see anyone put down more that 5% in the last few years. These are ticking time bombs.

And in other news, New Jersey is Number One!!

......."According to Bloomberg, New Jersey had the highest FHA delinquency rate, at 20%.

The state also had the biggest increase in the overall late-payment rate, jumping to 11% in the second quarter from 4.7%. Following were Nevada, New York, Florida and Hawaii -- all states with a high proportion of leisure and hospitality jobs that were especially hard-hit by the pandemic, the MBA said."

THANKS MURPHY!!!!!!! You made us Number One!!!!

Share this post


Link to post
Share on other sites

If there isn't some additional aid coming in the near future, many people's situations look like it will get worse.

......"Sixty-one percent of people who lost their job due to Covid-19 couldn’t come up with $500 in cash without selling something or taking out a loan, according to the SimplyWise survey — potentially helping tie over the needy but also putting them in debt. (That compares with 42% of Americans overall.)

Thirty-eight percent of people who have lost a job or had their income reduced due to Covid-19 couldn’t last more than a month off of savings of any kind, according to a bi-monthly survey published by SimplyWise, a technology company that helps people make Social Security decisions.

More alarming still, about 1 in 5 people couldn’t last more than two weeks off of their savings, such as an emergency stash or money earmarked for retirement, the company found.

106662592-1597347606069-20200813_continu

SimplyWise conducted its online survey of 1,128 American adults in early July. That suggests respondents’ financial situation may have worsened in the intervening time once aid ran dry.

https://www.cnbc.com/2020/08/19/nearly-40percent-of-cash-strapped-americans-cant-last-a-month-on-savings.html

Share this post


Link to post
Share on other sites

Well, looks like the so called "V" shaped recovery is turning into a "W" shaped recovery. State Unemployment numbers have reversed direction and are holding around the 1 million weekly number. Add in the Fed numbers, and they're going back up.

MW-IN818_jobles_20200903114227_ZG.jpg?uu

Here's the longer timeline showing where State UE claims were running before the China virus:

bfmA60F_0.jpg?itok=SkiLqcT7

Also, total continuing claims has been holding around the 30 million level, not many jobs have come back, and probably won't be coming back.

continuing%20claims.jpg?itok=gT2sUSa0

And, per the ADP jobs report yesterday, new job totals missed by a lot...

...."Private payroll growth came in well below expectations for August, according to a report Wednesday from ADP, whose job tallies have differed widely from the government’s during the coronavirus pandemic.

Companies added 428,000 jobs during the month, well below the 1.17 million estimate from economists surveyed by Dow Jones though a leap above the lackluster 212,000 that ADP measured for July.

https://www.cnbc.com/2020/09/02/private-payrolls-grow-by-428000-but-miss-expectations-adp-report-says.html

So, the economy can't create enough jobs in a MONTH to equal half that are lost in ONE WEEK.

Share this post


Link to post
Share on other sites

Well... no shit. 

I mean tons of people cant get their jobs back in many states and the live entertainment industry and ain't coming back for a while. Many service based industries too.. Its intuitive that those unemployed numbers will remain high. Not sure what TF people are expecting here. 

Share this post


Link to post
Share on other sites
18 minutes ago, JackDaWack said:

Many service based industries too.

Actually, that's where the bulk of the new jobs last month were created:

....."Big business dominated job creation, as firms with more than 500 employees added 298,000 workers. Medium-sized businesses were next with 79,000 while companies with fewer than 50 workers grew by 52,000.

Job creation skewed heavily to services, which added 389,000 compared with the 40,000 for goods producers. (The total doesn’t add up to 428,000 due to rounding.)

After lagging through the early part of the pandemic recovery, leisure and hospitality led with 129,000 new jobs while education and health services contributed 100,000 and professional and business services grew by 66,000. Construction also added 28,000 and manufacturing was up 9,000."

 

Share this post


Link to post
Share on other sites

Looked at historical data.  In 2018 we saw between 6500 and 12k new claim for weeks in this time frame.  Continuing claims between 70k and 100k.  Going back to 2010, the numbers were pretty much the same as 2018.

For comparison.

I think a lot of small retail businesses that were hanging in are running out of resources and the will to keep people employed.  Other businesses may be shedding payroll in anticipation of continued slowness in NJ.  But the numbers are still higher than other years. 

Not sure what all that means, but it looks like there are still issues in NJ.

Site I used.

https://oui.doleta.gov/unemploy/claims.asp

 

Share this post


Link to post
Share on other sites
3 hours ago, Kevin125 said:

Not sure what all that means, but it looks like there are still issues in NJ.

What I think it means is that the numbers haven't trended down. It's been 6 months. New claims recently have spiked back up to 24K. These aren't from temporary closures, but permanent closures. Not looking like much of a recovery.

Share this post


Link to post
Share on other sites
22 hours ago, Sniper said:

What I think it means is that the numbers haven't trended down. It's been 6 months. New claims recently have spiked back up to 24K. These aren't from temporary closures, but permanent closures. Not looking like much of a recovery.

Using the Freehold Raceway Mall as a barometer.... two anchor stores are gone. One more on the way out.  About 20 percent of the smaller retail stores there are permanently closed.   Area food establishments probably have fewer staff.  Some have probably closed.   I know a small number of people who have more corporate style jobs that lost those jobs when governors shut down businesses.  They were not called back to work.

Have we seen to numbers for lost government jobs?  I think that number is about..... Zero.

 

  • Agree 1

Share this post


Link to post
Share on other sites

The hits keep coming for workers, I doubt these jobs and revenues are coming back...

......"Prolonged closures at Disney’s California-based theme parks and limited attendance at its open parks has forced the company to lay off 28,000 employees across its parks, experiences and consumer products division, the company said.

In a memo sent to employees on Tuesday, Josh D’Amaro, head of parks at Disney, detailed several “difficult decisions” the company has had to make in the wake of the coronavirus pandemic, including ending its furlough of thousands of employees.

Disney has been hemorrhaging money since the outbreak began. In the second quarter, the company reported a loss of $1 billion in operating income due to the closures of its parks, hotels and cruise lines. In the third quarter, the company reported a steeper loss of $3.5 billion.

https://www.cnbc.com/2020/09/29/disney-to-layoff-28000-employees-as-coronavirus-slams-theme-park-business.html

Share this post


Link to post
Share on other sites

Wish I could say I feel bad for them, but they have been price gouging for years. Used to be an average family could afford a trip to Disney. Now they are all about the Benjamins. Disney has a bigger economy than some countries. 

  • Like 1
  • Agree 1

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.



×
×
  • Create New...