Experts say U.S. President Trump’s move to bypass Congress last weekend to sign an executive order to push forward a new round of negotiations on the anti epidemic aid program has not helped economic growth.
Trump’s executive orders include a temporary extension of unemployment benefits (at $400 a week), partial deferral of payroll taxes, suspension of federal student loan payments, and possible further suspension of tenant eviction orders. Even if trump can overcome the legal issues surrounding his conduct, economists say his efforts may not have much impact.
mark Zandi, chief economist at Moody’s Analytics, estimates that Trump’s executive order could provide more than $400 billion in relief. Michael feroli, an economist at JPMorgan Chase, said on Monday that the moves could bring “less than $100 billion” in stimulus money.
by comparison, the total amount of aid plans proposed by the Republican led Senate is $1 trillion, and the total amount of aid bills passed by the leading house of Representatives is more than $3 trillion.
Lydia boussour, a senior American economist at the Oxford Institute of economics, estimates that the total amount of presidential executive order relief will be 0.2% of GDP, which is actually “insignificant”.
big companies in the United States are going bankrupt at a record rate, but this is only part of the picture. According to some statistics, during the covid-19 pandemic, thousands of small businesses were disappearing, which could seriously drag down the economy.
part of the reason why the silent bankruptcy wave of small enterprises can not be counted is that the well-known real-time data about small enterprises are very scarce, and since the owners of small enterprises often have no debt, they do not need to go through the bankruptcy court.
“you may just call the utility company and tell them to stop service and close down and leave,” said William Dunkelberg, chief economist at the National Federation of independent enterprises. However, he also said the number of small business failures “will be much higher than normal because we are in a disastrous economic situation.”
more than 80000 companies were permanently closed from March 1 to July 25, according to online review website yelp Inc. About 60000 of them are local businesses, that is, companies with less than five locations. According to the American bankruptcy Association, from mid February to July 31, there were indeed about 800 small businesses that filed for bankruptcy protection under Chapter 11 of the bankruptcy code, and the agency expects the figure for the whole of 2020 to be 36% higher than last year.
the Federal Reserve can only buy short-term bonds of target companies, whose employees are mostly Americans, making automobile manufacturer related bills the main target. Since its last update on July 10, the Federal Reserve has purchased another $224 million in auto company related debt, the largest amount of any industry. Auto bonds are now the second highest in the Fed’s overall exposure, according to CreditSights’ analysis of the Fed’s data released on Monday.
the strategist led by Jeff khasin said in the report that the US financial subsidiaries of Daimler, Volkswagen, Toyota and Ford Motor of Germany are included in the Fed’s heavy positions.
although the Fed’s bond investments are intended to replicate the broader distribution of credit markets, these purchases undoubtedly support one of the largest domestic industries in the United States. The auto industry supports nearly 10 million U.S. jobs, contributing about 3% of the domestic economy each year, according to the alliance of automobile manufacturers, a lobby group.
David kostin, chief US equity strategist at Goldman Sachs, said technology stocks provide the best growth potential for long-term investors, despite the recent shift to value stocks.
kostin said: “the higher growth is still in technology stocks.” The low interest rate policy is likely to continue for several years after the popularity of the new crown, which will further benefit these stocks.
“in a low interest rate environment, higher growth will be more valuable and more rewarding in the long run. So that’s the story behind technology stocks. That’s why I focus on long-term growth. ” Kostin said.
Boeing said on Tuesday that the number of cancelled aircraft orders exceeded new orders for the sixth consecutive month as demand continued to decline. The company’s customers cancelled orders for 43 of its troubled 737 Max aircraft in July, with zero new orders.
Boeing said last month that it would cut production targets for some aircraft, including the 737 Max and 787 Dreamliner, as the new crown popularity continued to hurt demand for new aircraft.
from the beginning of this year to July, Boeing’s net negative orders were 836, including the aircraft cancelled from the backlog of pending orders. Boeing usually removes orders from its records when customers are struggling. The July adjustment reduced Boeing’s backlog to 4496.
Boeing delivered only four aircraft in July, including a 767 freighter and a 777 Freighter, as well as two Dreamliner Dreamliners.
airbnb will file its IPO application with the US Securities and Exchange Commission (SEC) in secret later this month and is expected to list by the end of this year, according to sources.
it is reported that Morgan Stanley will lead the public offering and Goldman Sachs will play a “key role”.
in a financing round in April, airbnb was valued at $18 billion, down from the previous valuation of $31 billion. Affected by the new crown epidemic, the company’s bookings tend to zero for several consecutive weeks.
airbnb was expected to go public at the beginning of this year, but because of the popularity of the new crown, it shelved its listing plan and laid off 25% (about 1900 employees) to cut costs. Brian Chesky, airbnb’s CEO, has previously told employees that the company’s revenue in 2020 will be less than half of that in 2019.