This year will be remembered … or maybe we will forget it. In the phase of furious coronavirus, civil unrest, and rampant political incitement, meeting reality was validated as a challenge. However, we realize a lot, so here are some ideas on what happened and what could appear in the future. We will talk in particular about the Covid19 virus, the economy, and the money markets.
The 2019 coronavirus pandemic (COVID19) has resulted in a public health catastrophe and a monetary catastrophe in the United States. The pandemic disrupted life crushed the system of medical institutions and triggered a global monetary recession. As of February 15, 2020, there were over 6.5 million cases of COVID19 in the United States and over 195,000 deaths (undated). Put these numbers into context and the pandemic now takes over 3 cases, as many Americans are living as they once did. The scale of the monetary catastrophe becomes unprecedented: the pandemic has triggered a demand for a shock, a delivery shock, even a monetary shock.
Before the pandemic, the American economic system worked well. The price of unemployment is 5,012 months now and inflation is also below the Federal Reserve’s 2.0% target. However, as we shut down much of the US economic system, “real” GDP growth has declined through the use of a month in the second quarter.
The price of unemployment has reached its highest level given the fact that the Second World War, reaching 14.7% at the start of 12 months. Although the price of the hobby has fallen for 5 consecutive months, it is still much better than the 3.5% in February. The leisure, hospitality, and air travel industries need to recognize if this helps.
The American financial system is particularly pushed to aid customer spending. When buyers consume, the business enterprise is worth it and the financial system is doing well. The number of unemployed is now 6.8 million more than in February. that Washington will (almost certainly) eventually pass all the other stimulus bills, so customer spending won’t go down anymore because they did it without help. However, there may be a possibility of being ready for too long. It is clear that the asset market will alternate forever. First, despite the fact that groups provided an era to improve efforts, this example has intensified throughout the duration of the pandemic and this example may even increase as groups try to maximize their profits and some groups will keep this practice so that they can reduce the demand for industrial property. Falling demand can also lead to lower industrial property prices and rents. Finally, many groups are completely closed, allowing staff to search for different job opportunities. The growing diversity of people looking for fewer jobs can create a pleasant job market for the employer and gradual growth.
US stocks peaked on February 12; they remained constant until February 19, and then fell more than 37%, hitting a low on March 23. From there, stocks rose sharply to peak again on September 2. On September 2, stocks were up 87.5%, the best variety on record, even surpassing the tech bubble of March 2000, while stocks were up 49%. As of this writing, stocks are inflated to 83.8%. The returns of stocks are an excellent indicator of financial expectations. When the economic system is in trouble, yields on Treasury bonds tend to fall and vice versa. On February 19, the yield on 10-year Treasury bonds rose to 1.56%. By March 9, the yield had fallen to 0.56%, a low at the time. A situation has become that yields may want to cross as badly as they did in many European countries in 2015. While that no longer materialized, and now no longer does, low yields create an environment in which bonds as funding have become less attractive. Therefore, low yields cause investors to spend money on stocks, which pushes valuations even higher.
Why do shares rise while the financial system is weak?
There is a reason inventory costs rise or fall which is defined by delivery and demand. When the “net” buying for pressure is more than “net”, which promotes the pressure, inventory costs increase and vice versa. It can also be defined by unique approaches, both of which can be close at some point.
The first is to shop when valuations are low. In short, buy after a drop in price. The actions were already in the media when the pandemic hit. However, as the financial system develops, the priority does not get so high.
The reason for this is momentum, which has been the case for several of those 12 months as stocks rose despite lost profits and lower consumption. The component is in the formation of a bubble. Do you remember 2000? Internet stocks, many of which were unprofitable at the time, have skyrocketed. While an excessive amount of momentum can stop badly, momentum can linger for many years (let’s say the ’90s bubble has expired). Six graphics showing how Covid19 shut down the United States economic system in its tracks
When America started shutting down by shutting down March to prevent the development of Covid19, before the Zoom calls or the restaurant closings or the endless Netflix frenzy, humans clearly stopped going anywhere.
In the coming months, unemployment could drop from 4.4% in March to 14.7% in April. It wouldn’t go below 10% until August. The first sector’s U.S. gross domestic product could decline 4.8% over time, the largest contraction due to the 2008 economic crisis. The next sector would fall 31.4% before growing 33.1% in the third quarter.
Now it’s all in retrospect. But when President Joe Biden and Congress approve a $ 1.9 trillion Covid Cures Bill almost a year later, it’s instructive that the appearance is back and takes into account just how the blow to the nation’s economic system becomes unexpected and drastic.
2. Air journey plunged
People have stopped stealing. Trump’s leadership implemented a travel ban in Europe in mid-March; however, air travel to the house collapsed precipitously in the following days. On March 12, nearly 1.8 million people passed Transportation Security Administration (TSA) checkpoints at airports, in accordance with US Homeland Security facts. A week later, that variety had fallen to around 620,000, a decrease of 66%. A week later, it becomes 203,000. In April, fewer than 100,000 humans flew on peak days.
3. Car revenue sank
While driving is still safe, thousands of people stop commuting to work, which has a major impact on new car earnings. The following week, sales were expected at 14th. In the week of March 22, unit purchases were 36% of the previous forecast. A week later, the prognosis was 59% lower.
4. The restaurant is reset to zero
When people are at home, the supply chain quickly closes. For catering companies, March 9 is the first day to shut down the canteen. According to Open Table data, visitors who book online 7 days a week on March 8 get a 1% discount from the previous year. The next day, it fell 14% over the year.
On March 13, it was down 36%. As of March 20, it had fallen 99.35%. If the total sponsorship drops well below 50% on the same day in 2019, it could be June 21.
5. Film Theaters
The weekend of March 6, the US earning over $ 100 million in revenue. Disney’s “Onward” became the highest-grossing film, seen through NBC Universal’s “The Invisible Man”.
The following weekend, container sales fell nearly 50% to $ 54 million. A week later, it becomes $ 195,952.By April, the commercial film business had successfully shut down.
6. Too much fuel
The coming weeks could offer all kinds of ripple effects, upstream and downstream in the delivery chain. Restaurants and stores could first alternate their groups with delivery models. Entertainment groups could increase the switch to video streaming.
An initial delay indicator becomes oil delivery. When the transport stopped, U.S. refineries had to sit on unused barrels, a statistic that only emerged weeks after the industry shut down. By April 24, it had almost doubled to 48 days.
This form of rebound is unprecedented in the tradition of the United States. Facts of the administration of energy information.