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U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
331–340 of 877 posts
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#332Earlier quoted context omitted.
There was some discussion of aspects of this yesterday and there have been a few articles. The general consensus is that kids who have good home environments and have at least some interest in learning will mostly do fine. Some may even do better than normal. But kids in poor home situations who were already barely scraping by--if that--will basically lose the year and everything that implies. In some areas, double-d…
What does it imply? If any school district cares, all the kids will essentially end up repeating a grade. This is not the end of the world. If anything, it might improve student achievement. (Students who are born right after the cutoff for a particular elementary school class, in aggregate, outperform the ones born just before, the youngest in the class.) Outside of college-bound seniors — a special case — the main…
You don't understand how urban school districts work if you think you can just get a grade to "repeat itself." Kids will drop out once they're 18 like flies.
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#333NB this is for the first quarter of 2020, which had hardly any impact from Covid-19 - lockdowns mostly happened late March and the start of April. So the second quarter will be a better reflection of the impact of shutdowns and changes in consumer behaviour/travel, but we won't see figures for that for a while. Almost more worrying, 20% of the value of the S&P 500 is now concentrated in the top 5 tech stocks, which a…
While you’re right that Q2 will be worse than Q1, don’t underestimate how early the pain started. Restaurant bookings on OpenTable began dropping in early March, before the lockdowns began. By 3/16 OpenTable has bookings down 50%, before most municipalities had lockdown orders in place.
And that’s not even including the drop in travel and supply chain difficulties, which started earlier still.
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#334Earlier quoted context omitted.
The used car market has been inflated for years. 100k+ mile vehicles selling for over half their new price makes no sense to me.
It's because of the long term 72-84 month loans. People are trading in used cars for close to the loan payoff amounts - which is still pretty high.
That should only change the asking price, not the actual sales price. Its not like the dealers are going to eat the loss. They just roll what they might lose into the new loan.
I dont have access to the actual sale prices at auction to know what the true worth of these cars is though. I would guess half of the retail asking price?
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#335NB this is for the first quarter of 2020, which had hardly any impact from Covid-19 - lockdowns mostly happened late March and the start of April. So the second quarter will be a better reflection of the impact of shutdowns and changes in consumer behaviour/travel, but we won't see figures for that for a while. Almost more worrying, 20% of the value of the S&P 500 is now concentrated in the top 5 tech stocks, which a…
Vulnerable, yes but the google earnings from yesterday show even in advertising, there seems to be a temporary floor. Entirely possible the floor is a temporary illusion and falls out over next 3mo, but the market is betting that won’t happen (I don’t know why, I’m not an expert on ads)
The market can either be betting that there’s a floor, or that Google will survive and ads will be valuable again in the future. Either or.
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#336Earlier quoted context omitted.
I understand their thinking because not working is causing a massive amount of collateral damage, but the virus doesn't care about any of that. If everyone goes back to normal too early, this all just starts over, and folks are forced to be inside even longer, there's just no way around it.
This is wrong. We are not forced to be inside because of the virus. It would have been totally possible to have this pandemic going on with zero lockdowns, which would have probably led to worse health effects, and less-bad economic effects. It's a pet peeve of mine when people claim that we must lock down or that the virus is forcing us to do this or that, as opposed to it being a political choice based on tradeoffs…
The “lockdown” is a Fabian strategy; one of the goals is to preserve our ability to stage an economic comeback after the health crisis has been resolved. In the near term, the economy is toast no matter what we do (short of a well oiled contact tracing and isolating machine).
This paper seems to suggest there isn’t really a tension between protecting people’s health and saving the economy: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3561560
You are correct that the lockdown measures are a choice and not a natural consequence of the virus though.
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#337I understand that the economy and the market are different but I'm so confused. The S&P is up ~12% this month, despite massive unemployment, a shrinking economy, and serious long-term questions about the outlook. Is most of the 12% just market speculation that the virus issue will pass without a long-term earnings hit?
The S&P500 is an index of some of the best performing companies in the US. Their performance isn't completely correlated with the broader market. Additionally, this damage to the economy is not permanent, most companies in that index will survive and continue to / return to paying dividends for a long time going into the future.
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#338Earlier quoted context omitted.
> Good point. Dow is also up almost as much though. The dow is a subset of large companies in the S&P.
Look at the Russell 2000.
I was responding specifically to this comment that says "look at the Dow Jones instead of the S&P" to make a point that it's the same issue. I agree with parent overall in that I'm surprised the market is holding up as well as it is.
Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#339Earlier quoted context omitted.
> Missing 5/8ths of a school year is going to be absolutely devastating for this generation of kids. Which subject can they study at school that they cannot study at home?
Some of them have essential workers as parents and are left unsupervised during the day. Some have parents ill equipped to assist them with school work those parents never completed themselves. (Hell, I went to college, and my kids' math work is a challenge.) Some have no access to internet. I saw an article the other day (I'm unfortunately having trouble Googling it up) that said some school districts have 15-20% st…
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Re: U.S. Economy Shrinks at 4.8% Pace, Signaling Start of Recession
#340This is anecdotal and it might come across as bitter and tonedeaf as someone who is not in a STEM job and cant see the bigger picture very well. Im a diesel engine tech who repairs those big trucks carrying food and shit tickets to grocery stores. the fact that ANY market is completely detached from whats actually happening to Americans is frustrating. My job just cut benefits and hours but we're "essential." Remembe…
> Lenders and banks were supposed to start going easy on loans but ive had two emails and a phone call about the loan for my Silverado this month and wouldnt you know, the caller was excited to mention my stimulus check. Don't settle for this. My niece had her car repossessed 3 weeks ago. They said for $18k cash she could have it. We told them to pound sand. She's borrowing cars and getting rides, but next week she'l…
This might be a dumb question, but wouldn't whoever sold the car/provided financing have the lien on the title? Wouldn't sale/financing be contingent on no other liens on the car/property?