The Fed doesn’t believe in a V-shaped recovery and neither should you

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The Fed is warning of several risks to the economic recovery process including damaged labor market dynamics and the potential for a long and deep recession.

Don’t underestimate COVID-19 and the global scale of the economic crisis.

We see the risks for stocks as tilted to the downside and expect a correction lower driven by a rotation out of the mega-cap tech leaders.

The FOMC met this week for its first Fed funds interest rate decision since the two emergency cuts in March. As expected, the policy rate was left unchanged at 0% with the markets focusing more on the various relief measures in response to the coronavirus pandemic and now looking ahead towards the economic rebound.

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South Dakota has ‘flattened the curve’ without shutting down

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South Dakota Governor Kristi Noem got pushback for her decision to let the 880,000 citizens of her state decide on their own whether to follow her suggestions as to social-distancing and other behaviors to fight the coronavirus. On Wednesday she told Breitbart in an exclusive interview that despite her state remaining free of lockdown/shutdown/stay-at-home orders, the significant surge in virus cases projected by various predictive models failed to materialize.

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The big freelance skills needed as companies rebuild after COVID 19

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Over twenty two million Americans lost their jobs in a little less than a month due to COVID 19. It took the Great Depression more than four years to achieve an equivalent level of unemployment.

Millions of freelancers around the world have also lost critical project and consulting work; many clients have closed up shop. Gigsters have struggled to make a living as companies focus on conserving cash, reducing non-essential expense, and planning for an uncertain post COVID 19 world.

So, it made sense to ask freelance platform CEOs and thought leaders this question in our series, the freelance revolution during COVID 19:

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Another thing the virus could kill : More than 1,000 Colleges and Universities

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CHANGED FOREVER?

COVID-19 has disrupted our world in big and small ways. We have shut down as a nation to save lives. We watch the news and hear of deaths in the hundreds and thousands and wonder if we are at the peak yet. Simple acts, such as going to the grocery store or walking the dog, have become significant sources of anxiety. Food insecurity has intensified as increasing lines at food banks demonstrate. We have new respect for service workers. We cheer our new heroes, the first responders, doctors, and nurses who are our frontline soldiers in this war.

And we celebrate our teachers, but we have ignored university professors, who have also had to refocus the way they teach, do research and spread knowledge.

Higher education as a sector is getting hammered. Our national focus is rightly on the current frontline health providers. But we need to realize that despite some federal funding, many universities and colleges may never recover from COVID-19.

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A coronavirus recession will mean more robots and fewer jobs

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Automated delivery bots are already working in the small town of Milton Keynes, England.

All economic downturns increase automation. This one will be worse.

The novel coronavirus pandemic is certainly not good for the labor market. Recent weeks have seen unemployment claims surge to record levels as businesses and entire industries shutter in order to stop the spread of the Covid-19. As a result, the economy has plummeted, with the Dow Jones Industrial Average and S&P 500 down more than 20 percent from their February highs.

While social distancing measures may be temporary, this economic downturn’s effect on the labor market will have long-lasting effects. In a joint post with his colleagues, Mark Muro, a senior fellow and policy director at the Brookings Institution’s Metropolitan Policy Program, recently wrote, “any coronavirus-related recession is likely to bring about a spike in labor-replacing automation.”

Economic downturns, he argues, bring about increased levels of automation, which is already an existential threat to many jobs. And a coronavirus recession, due to its breadth and scale, could cause even more automation.

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How economists calculate the costs and benefits of COVID-19 lockdowns

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Value of Saving One Statistical Life, by Age

There is a huge public debate whether the economic costs of actions designed to arrest the spread of COVID-19 are worth the potential health benefits achieved.

Literally trillions of dollars in lost economic output and uncounted lives hang in the balance. No rational discussion of this weighty issue is possible without first having a hard-nosed discussion of the dollar value of saving the lives of COVID-19 patients.

This post will focus on the well-established methods that health economists have devised to answer this question.

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This company is building backyard homes at no cost to Los Angeles homeowners

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Crews build an ADU in the backyard of the McCauley residence in Gramercy Park.

But homeowners have to be willing to rent out the units.

Davita and Martin McCauley were starting to think about how, in the years to come, they would care for her mother as she aged .

The McCauleys own a classic World War II-era Southern California home: a peach-hued stucco bungalow in Gramercy Park, with a grassy lawn in the front and a detached garage in the back.

They were toying with the idea of eventually moving her into their three-bedroom house, and adding a second story to make more space, when they were introduced at church to a mutual friend working for a new company called United Dwelling.

At no cost to homeowners, the company builds “granny flats” in the backyards of single-family homes, finds a tenant to rent them out to, and splits the lease revenue with the homeowner for up to 25 years, at which point the homeowner owns the unit outright.

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Look to cities, not nation-states, to solve our biggest challenges

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Los Angeles’ economy is bigger than that of many nation states.

This article is part of the World Economic Forum Annual Meeting

The world in 2020 is looking more turbulent and uncertain than ever. Powerful economic, demographic and technological forces are rewiring international politics. According to the World Economic Forum’s new Global Risks Report, structural shifts are encouraging nation-states to adopt more transactional and unilateral postures. Some nations are abandoning old alliances, questioning the value of multilateralism and retreating to narrowly defined national interests. Amid continued downward pressure on the global economy, citizens are growing restless and frustrated with their national politicians.

Maybe they’re onto something. Perhaps nation-states are part of the problem.

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Why Manhattan’s skyscrapers are empty

Duplex Penthouse At 50 United Nations Plaza As Manhattan Luxury Condo Builders Try Dealmaking In Hunt For Buyers

Approximately half of the luxury-condo units that have come onto the market in the past five years are still unsold.

In Manhattan, the homeless shelters are full, and the luxury skyscrapers are vacant.

Such is the tale of two cities within America’s largest metro. Even as 80,000 people sleep in New York City’s shelters or on its streets, Manhattan residents have watched skinny condominium skyscrapers rise across the island. These colossal stalagmites initially transformed not only the city’s skyline but also the real-estate market for new homes. From 2011 to 2019, the average price of a newly listed condo in New York soared from $1.15 million to $3.77 million.

But the bust is upon us. Today, nearly half of the Manhattan luxury-condo units that have come onto the market in the past five years are still unsold, according to The New York Times.

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The geography of gender: where women work, economies grow

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Women from a single mothers’ association sweep rice at their processing plant in the town of Bolgatanga, Ghana.

Our world is full of brilliant possibilities. But they’re not always open to everyone. The opportunities for women to contribute to the global economy are intrinsically linked to where in the world they are born and reach adulthood. So long as global disparities exist in education and opportunity – as the World Economic Forum’s Global Gender Gap Report reaffirms this week – this will always remain the case. This holds us all back. Yet, the business community can, and must, help tackle this divide.

The geography of gender is challenging and complex. The latest Mastercard Index of Women Entrepreneurs (MIWE), for example, highlights the significance of geography in female entrepreneurship. Unsurprisingly, MIWE showed that higher-income, advanced economies, with open and vibrant markets that support SMEs and the ease of doing business provide highly conducive and enabling conditions to support female business owners.

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The coming boom in Millennial wealth

 

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Historically, much written on Millennials has focused on economic strife and crushing student loan debt. While, as with virtually every other generation in history, many Millennials have struggled financially during their youth, a new report from youth marketing experts YPulse makes four predictions that are suggestive of a significant turnaround being on the horizon.

Before getting to the predictions, it is important to take into account two key factors pertaining to Millennial wealth. First, the U.S. economy has been booming for a sustained period of time. Unemployment reached the point in 2018 where there are more open jobs than workers, the stock market is up, GDP has been growing at a healthy pace, and average real earnings have been increasing. In such an environment, those becoming established in jobs are in a better position to thrive. Moreover, many Millennials have been known to be careful spenders on many consumer products.

A second factor that bodes well for wealth growth is that student loans are not the albatross they are made out to be for most Millennials. While this does not mean that a significant number of individuals do not struggle with student debt, when one takes a macro view of the situation, it is not as bad as it has often been made out to be. One needs to remember that average level of $30,000 of student loan debt in 2019 would have translated to about $4650 in 1970 when an average aged Baby Boomer was taking out loans.

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Boomer homes to flood US market, but who will buy them?

Baby Boomer home sales will flood the housing market: Report

Baby Boomers’ homes will be sold on a large scale over the next 20 years, but with millennials refraining from home ownership, who will be buying them?

The U.S. housing market is on the verge of being inundated with homes for sale on a scale that hasn’t been seen since the housing bubble in the mid-2000s.

The tsunami is being driven by a grim reality: Baby Boomers dying.

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