The Nation's Financial Condition

[DocBarrister]

According to various media reports, Mnuchin told Senators today that U.S. unemployment could reach 20% without the trillion dollar stimulus package.



That is Great Depression-range unemployment.

If true, a trillion dollars won’t be enough.

DocBarrister

[MDlaxfan76]

According to various media reports, Mnuchin told Senators today that U.S. unemployment could reach 20% without the trillion dollar stimulus package.



That is Great Depression-range unemployment.

If true, a trillion dollars won’t be enough.

DocBarrister

Probably correct.
If so, the direct payments will need to be larger and every month until out the other end.

[a fan]

According to various media reports, Mnuchin told Senators today that U.S. unemployment could reach 20% without the trillion dollar stimulus package.



That is Great Depression-range unemployment.

If true, a trillion dollars won’t be enough.

DocBarrister

Starting to get the picture, are we?

There's 150 million food service workers....since you asked in a previous post if we hit a million jobs lost. We're in the millions already.

Monthly cash payments until quarantine is over.

Mortgage/loan Holiday, for commercial, too.

I have no clue why it's so difficult for folks to understand that you can't shut down the entire US economy for two months without these measures. Mnuchin's words today tells me that they FINALLY get it.

We're talking several Trillions. Trump and Congress blew 3+ trillion MORE over the last three years, so what's the big deal?. The money is there for borrowing. They just need to execute.

[Typical Lax Dad]

According to various media reports, Mnuchin told Senators today that U.S. unemployment could reach 20% without the trillion dollar stimulus package.



That is Great Depression-range unemployment.

If true, a trillion dollars won’t be enough.

DocBarrister

Starting to get the picture, are we?

There's 150 million food service workers....since you asked in a previous post if we hit a million jobs lost. We're in the millions already.

Monthly cash payments until quarantine is over.

Mortgage/loan Holiday, for commercial, too.

I have no clue why it's so difficult for folks to understand that you can't shut down the entire US economy for two months without these measures. Mnuchin's words today tells me that they FINALLY get it.

We're talking several Trillions. Trump and Congress blew 3+ trillion MORE over the last three years, so what's the big deal?. The money is there for borrowing. They just need to execute.

Anyone notice that $1,000.00 was the same amount of the “tax bonus” for the working man? Not based on any reality, just picked out of the sky.

[a fan]

Excepting for when a true direct straight line to national security or common physical infrastructure why should a democratic government bail anyone out?

Speaking for my business, the government forced me to close my doors. That's why.

[DocBarrister]

Excepting for when a true direct straight line to national security or common physical infrastructure why should a democratic government bail anyone out?

Speaking for my business, the government forced me to close my doors. That's why.

Aren’t you a liquor distributor?

DocBarrister

[MDlaxfan76]

Producer/bar if I'm not mistaken.

[DocBarrister]

Producer/bar if I'm not mistaken.

Like one of those microbreweries?

Tough times for a fan.

DocBarrister

[Farfromgeneva]

Excepting for when a true direct straight line to national security or common physical infrastructure why should a democratic government bail anyone out?

Speaking for my business, the government forced me to close my doors. That's why.

Which is a tragedy and I have great empathy for you and understand why you'd personally feel that way, but given you are in a highly regulated business that can be shut down most any time for numerous reasons and has no direct line to national security or physical shared infrastructure I don't see why that alone requires a transfer payment. Otherwise, I can work down the road to why all regulation, licensing and other oversight all being illegitimate. If one accepts that gov't has the legal right to shut any or all businesses down for this, or really anything (commerce clause gets abused) then I don't see the case for compensation. It sucks, but maybe a one off, however we can't simply ride this until it's figured out when we don't have any g*d da** idea how long the path is to "flattening the curve" so to speak. And I'd still rather give it straight to individuals than businesses. Should we bail out every REIT that agreed to sign significant long term leases to wework, who is definitely going to have to have a legal restructuring, the asset/liability mismatch is egregious. There's builders and owner/operators who acquired properties at very tight modeled cash flow levels and levered up and did so signing or knowning they had meaningful counterparty risk there? That would in effect be a indirect transfer payment to Fng Softbank the Japanese idiot conglomerate who bet big on the quality of Sprints operations and has been riding it's stake in Alibaba as far as one can go.

I mean hell, why aren't black folks asking "payments? wheres my m**herf**king reparation money?" and native americans going "payments? S*iiiiiiiit, try getting a "gift" infected blanket to share with your tribe. Where's our dough?"

These statements all get made so definitively but lines have to be established and set hard with a plan and thought in place. Rolling comp and payment holidays for everyone would destroy us in 6mo.

[MDlaxfan76]

Producer/bar if I'm not mistaken.

Like one of those microbreweries?

Tough times for a fan.

DocBarrister

That's my understanding.
Tough times for all restaurants, bars, health clubs, churches...not sure who is doing well except delivery services.

[MDlaxfan76]

Excepting for when a true direct straight line to national security or common physical infrastructure why should a democratic government bail anyone out?

Speaking for my business, the government forced me to close my doors. That's why.

Which is a tragedy and I have great empathy for you and understand why you'd personally feel that way, but given you are in a highly regulated business that can be shut down most any time for numerous reasons and has no direct line to national security or physical shared infrastructure I don't see why that alone requires a transfer payment. Otherwise, I can work down the road to why all regulation, licensing and other oversight all being illegitimate. If one accepts that gov't has the legal right to shut any or all businesses down for this, or really anything (commerce clause gets abused) then I don't see the case for compensation. It sucks, but maybe a one off, however we can't simply ride this until it's figured out when we don't have any g*d da** idea how long the path is to "flattening the curve" so to speak. And I'd still rather give it straight to individuals than businesses. Should we bail out every REIT that agreed to sign significant long term leases to wework, who is definitely going to have to have a legal restructuring, the asset/liability mismatch is egregious. There's builders and owner/operators who acquired properties at very tight modeled cash flow levels and levered up and did so signing or knowning they had meaningful counterparty risk there? That would in effect be a indirect transfer payment to Fng Softbank the Japanese idiot conglomerate who bet big on the quality of Sprints operations and has been riding it's stake in Alibaba as far as one can go.

I mean hell, why aren't black folks asking "payments? wheres my m**herf**king reparation money?" and native americans going "payments? S*iiiiiiiit, try getting a "gift" infected blanket to share with your tribe. Where's our dough?"

These statements all get made so definitively but lines have to be established and set hard with a plan and thought in place. Rolling comp and payment holidays for everyone would destroy us in 6mo.

I'm not sure I agree with this geneva, at least not 100%...by your logic why should any individuals get direct payments? After all, they're "at will" workers after all, should have expected to be let go at any moment...they should have been in a union?

I think I agree with a fan, if your business has been shut down by a demand by government under a national emergency, there's a reasonable expectation of support in return. That is, if you want full buy-in to the system ongoing.

which we do, right?

That said, I agree with you that this is all very problematic.

[Farfromgeneva]

Ok at what cost? As I enjoy pointing out, the generation before me, boomers, have blown up our balance sheet at this stage so there’s no levers to pull.

If we paid for 7-8 mo and caught a rating agency downgrade Is that worth it? And what is the expected payback? Return floor should be what for x cost? I don’t hear any realistic discussion of cost benefit when our country and the global economy is already like a stretched rubber band. More importantly I am super focused on our maintenance as reserve currency which gets less stable by the month for the last couple of years

As far as buy in, the govt had it or it didn’t before corona became anything more than an overrated spring break beer. No one had thoughts of this. I don’t believe it’s required to meaningfully change buy in, especially if you’re talking about heavily regulated industries already. They live with it enough their in or out of business.

I’m not 100% sure on even direct individual pmts here yet, understand the pain but remain consistent in limiting expenditures-ya know, kind of like maybe a fiduciary. But when I think of that I think of individual citizens and not employees and this being a straight transparent wealth transfer for the benefit of society from a political perspective. I also don’t think of corporations as individuals notwithstanding the Supreme Court ruling. So there’s a meaningful distinction, not that I could easily disagree with the at will argument per se, but I do believe at times the govt must stand up and provide safety nets for citizens. That’s before even getting into how do you not subsidize profits in the support? Do you put business owners on tight salaries while their getting the support, no personal cars and home expenses run through tax returns, clean books. Is there any other say? I can live with underserving individuals benefitting from blanket emergency support, but I have a much harder time supporting many bad business operators and owners who a bunch of were living on borrowed time to begin with.

Of course give everyone everything. I see any number approaching $1Tn in business and private sector not individual support and I need a very detailed and thoughtful plan and case to be made to me. I’m that concerned about macro economics and our status even before this event unfolded.

[Farfromgeneva]

Airlines asking for $50Bn, Boeing (whos mgt might be the worst since John delorean had a company) asked for $60Bn for aerospace, hotels (who already get a buttload of support in the form of SBA mini permanent financing but also more recently PACE money allowing them to build with nothing much down and flooding a lot of tertiary markets with generic, builder grade flagged hotels they don’t need and more busted traffic as a result) is asking for $150Bn.

Where’s the line?

[a fan]

Producer/bar if I'm not mistaken.

Like one of those microbreweries?

Tough times for a fan.

DocBarrister

No. A distillery with a tasting room that brings in 7 figures. And no, it's not tough times for me, as long as the government and safety of my fellow citizens allows me to stay open.

We can weather two months of no sales ok, and keep paying our employees.

[a fan]

I see any number approaching $1Tn in business and private sector not individual support and I need a very detailed and thoughtful plan and case to be made to me. I’m that concerned about macro economics and our status even before this event unfolded.

Um.....we borrowed $3 Trillion over the last three years of Trump. Suddenly your calculator springs to life over the idea of $1 Trillion?

You had your chance to complain. You didn't. I did. Have been since Bush era. No one wanted to hear it. Heck, the TrumpFans have been bragging about all that borrowed money and how great the economy is.

As Lou Manheim said to Bud Fox in the movie Wall Street, " You can't get a little bit pregnant, son"

[Farfromgeneva]

Why do you talk at everyone and paint them with the same brush? When have I ever been cool with the fiscal policy and programs of basically the past 20yrs? Where did I once support it? Because I don’t sounding like a shrill maniac everyday on that singular topic clearly I also sat back and had no problem with that? Where pray tell me did you ever get any notion of that from me?

I vehemently disagree that if I don’t rant like a menstruating lady but do in fact bring up my concerns and distaste in more measure calmer ways that means I was fine with it. That’s just wrong on your part. No room even for interpretation.

Had my chance to complain? And I have since I got my bank into ethanol in my 20s during the bush mandate understanding how tragic that would all shake out as it did. I hated the capital gains tax cut because tax rates should be at parity, whatever level that is, so as to not skew investment decisions UNLESS it’s done with it codified as the expected outcome of such changes (which it wasn’t). I hated cash for clunkers and the auto and bank bailout. Dick Fuld could’ve possibly save Lehman, and maybe even some of the subsequent damage overall has he not be looked at the Fed and Bear and sat back thinking, “well, were bigger than bear and globally deeper so if they backstopped them they’ll take care of us”, which he’s effectively admitted to by now.

Otherwise it might make sense to communicate rather than talk at people on autopilot. You’re response is bu**turd IMO and does nothing to even attempt any issues I’ve brought up.

[a fan]

Why do you talk at everyone and paint them with the same brush? When have I ever been cool with the fiscal policy and programs of basically the past 20yrs? Where did I once support it? Because I don’t sounding like a shrill maniac everyday on that singular topic clearly I also sat back and had no problem with that? Where pray tell me did you ever get any notion of that from me?

Same place you got the notion that I think I should get a bail out. We both assumed.

You asked WHY I thought my biz should be eligible for a bailout. I gave you a rational reason.

We don't NEED a bailout. We need to be able to sell our goods in two months. If that happens? No problemo.

Apologies to you for assuming. It's been a rough day, no? So....sorry.

[Farfromgeneva]

Excepting for when a true direct straight line to national security or common physical infrastructure why should a democratic government bail anyone out?

Speaking for my business, the government forced me to close my doors. That's why.

I responded overly strongly but I’m pretty sure I was posing the question hoping to elicit some answers as to why anyone should be bailed out at this moment. Then further for how long, at what acceptable cost or expected floor “return”/benefit from it. But you said you thought that you merited some support because the government told you to shut down your business. It sucks and even moreso when the decision is taken out of your hands, but it doesn’t really make the argument to just spray money to everyone like it’s nba draft night in Vegas.

I still haven’t heard anyone address how much, to whom, for how long, in order to address who or what specifically, what is the expected benefit for such action(s).

I may relatively very persuaded for some or all of what everyone wants to do to make it rain but not just because it’s a mess out there and we still don’t have any visibility beyond tomorrow or next week.

[Farfromgeneva]

This kick the fan thing will cost us dearly one day. We have to, have to allow some negative events to cost people much more than we have since maybe Bretton Woods, or at least Paul Volker dropping loan shark rates onto the public to stave off inflation risks.

Bail out Long Term Capital Mgt, continental illinois, energy policy decisions, 08-10 various actions, permanent state of currency sterilization and semi 0% range bound fed funds (we’ve probably topped out at 2.25-2.5% for a good long while though the ten year climbing back above 1.0% is encouraging), financialization and govt involvement in mortgage market having reduced the great unintentional savings vehicle for most boomers by leveling up and better liquifying the asset class for future generations.

All this while Russia was falling back from its post wall fall potential, China can’t keep its momentum and the European Union is behaving predictably if one ever spent time in those various countries in the past and read two pages of history. So no viable currency or economic counter to us making it easy to be soft, obtuse, believing in our own greatness coming out of the crisis and we’ve so managed our economic infrastructure and expectations that when it breaks sometime sooner rather than later (meaning next 25-50yrs) it’s going to break for the last time.

[a fan]

I still haven’t heard anyone address how much, to whom, for how long, in order to address who or what specifically, what is the expected benefit for such action(s).

I said what to do over a week ago.

Direct payments to tax filers. The more, the better. Remember that the EU is right behind us on this thing.....so their economies, and the demand they bring, is about to go into the toilet. I'd say $2-$5K per month for the two months they are asking for shut down.

From there, mortgage/commerical loan holiday....shift payments by two or three months. Banks still get their full money, plus interest. Back up the banks loss of loan revenue with Federal money/guarantees.

That will get us through the next two months. Citizens will have money. Most businesses will survive.

If you don't do that, there won't be businesses for these workers to return to in 60 days.