by William Skink
This country is not ready for what’s coming.
A decade of central bank intervention to prop up financial markets with low-interest liquidity is going to be undone by the Coronavirus. Wall Street is finally waking up to this harsh reality, and you should to.
A myriad of systemic flaws will be exposed by the global grip of fear and panic now taking hold. Globalized supply chains are already being disrupted and the transportation sector will be hit hard. Then there’s our lovely health care system…
Here in Missoula, the economic pain will start being felt as the weather warms and tourists don’t arrive in droves like they normally do.
Missoula’s economy, like the nation’s, is a house of cards. All the bonds passed in recent years to fund parks, schools and a spanking new library are predicated on continued economic growth. What if that growth is halted by the Coronavirus?
At the end of January, this is how the economic outlook for Missoula was being reported:
“The biggest contributor to overall growth has been expansion in the local economy’s finance and business services industries, which reflects strong tech growth as well as financial institutions serving residential and commercial real estate markets,” Barkey said.
That means booming Missoula tech companies like Cognizant-ATG, Fintech and traditional lawyers, accountants and engineering consultants, fall under those two main categories.
Barkey said the trends will persist as Missoula continues to outpace the state.
“Looking ahead, we expect to see a continuation of growth exceeding the state average, winding down a bit as the pace of the economic expansion cools in the coming years,” he said.
I don’t expect to see a sunny economic forecast like this again in my lifetime.
Over the decades Missoula has transformed from an extraction economy (mostly timber) to an economy that relies heavily on tourism.
Public money has been used to bring hotels downtown. The airport is expanding to bring more tourists in by air. The argument for a gas tax and/or a sales tax is based on it snatching money from those precious tourists who are supposedly going to help dig us out of the housing crisis we are in.
What happens if the tourists don’t come?
Using myself as an anecdotal example, there is no way I’m taking my family on the summer trip we had been planning to Washington State. And one of my co-workers is cancelling their family trip to Disney Land. How many people like us are cancelling trips?
I’ve also been thinking about how the Coronavirus will most likely come to Missoula, if it’s not already here. My thinking is along the lines of what types of populations are mobile. I’m explaining my thought process because what I’m about to say might be controversial.
I think either the seasonal transient population and/or the wealthy vacation home population are the two most likely types of people to spread Coronavirus to our community.
I am not saying homeless people are diseased, let me just state that as clearly as I can. The seasonal transient population is a small subset of the larger population of those without homes. Like the very wealthy, they are not as tied down to a geographic location.
However it arrives, if and when it does, prepare for an increase in irrational behavior.
JC
FUCK THE POOR.. working OR OTHERWISE.
https://www.mintpressnews.com/big-banks-call-wall-street-deregulation-fight-coronavirus/265558/
Big Banks Call for Wall Street Deregulation to “Fight Coronavirus”
As Naomi Klein laid out in her bestseller “Shock Doctrine,” the wealthy elite use the confusion caused by economic and other disasters to quickly force through pro-free-market legislation.
by Alan Macleod
As coronavirus panic hits the U.S., a financial lobbying group is attempting to use the crisis to push through the deregulation of its industry. The Bank Policy Institute (BPI), a Washington-based lobbying organization representing many of the nation’s largest banks, released a set of proposals this week, the most important of which recommends that the Federal Reserve lower capital requirements to zero. This would mean banks could lend an unlimited amount without having any assets or wealth to back it up. It also advocated relaxing the so-called “stress tests” that force banks to show that they can withstand economic shocks. This, it claims, would help America fight the COVID-19 virus. The report’s lead author was BPI CEO Greg Baer, former Managing Director of JP Morgan Chase.
The recommendations have been condemned as incoherent and “transparently opportunistic” by Jeremy Krass of the University of Michigan School of Business. “The whole idea of capital requirements and stress-testing banks is to make sure they have enough cushion to absorb losses” in a period of economic crisis, Kress told the Washington Post. Now that the economy has gone into a sudden shock, Wall Street wants those regulations lifted.
The government itself is also trying to force through measures that it dubiously claims would help fight the coronavirus. Earlier this week President Trump called on Congress to enact a large tax cut and pushed Democrats to support it.
These efforts perfectly encapsulate the idea of the “Shock Doctrine” that author Naomi Klein laid out in her 2007 book of the same name. Klein argued that the wealthy elite use the confusion caused by economic and other disasters to quickly force through pro-free-market legislation that would otherwise meet with widespread and coordinated opposition. As she said, “the idea of exploiting crisis and disaster has been the modus operandi of [economist] Milton Friedman’s movement from the very beginning – this fundamentalist form of capitalism has always needed disasters to advance.”
“Some of the most infamous human rights violations of this era, which have tended to be viewed as sadistic acts carried out by antidemocratic regimes, were in fact either committed with the deliberate intent of terrorizing the public or actively harnessed to prepare the ground for the introduction of radical free-market ‘reforms,’” she explained.
Klein cites Hurricane Katrina – where the Bush administration rushed through privatization and charter school bills for New Orleans while residents were reeling from the devastation – as a perfect example. Going further back, Chilean dictator Augusto Pinochet used his coup against President Salvador Allende to turn Chile into a free-market, neoliberal experiment almost overnight, over the protestations of ordinary Chileans, whom he suppressed with overwhelming force.
There are many things to worry about with the corinavirus, but a plunging stock market is not one of them, unless you are one of the minority who owns a large amount of stock https://t.co/lxZC10PxgD
— Dean Baker (@DeanBaker13) March 6, 2020
The stock market is in serious decline amid fears that the coronavirus will disrupt international supply chains; the Dow Jones index plummeted nearly 1,000 points yesterday. Yet, as the Center for Economic Policy Research’s Dean Baker has noted, the stock market is a very poor indicator of the economy’s current and future health. It is, however, a great gauge on how the top one percent are faring. Stocks also tend to surge after natural disasters (like the 2004 Indian Ocean tsunami) or when conservatives win elections (in December, British banks and weapons manufacturers’ share prices jumped after Boris Johnson beat Jeremy Corbyn). This is because corporations, ignoring the devastation, expect big orders to rebuild or to destroy.
News that will cause stocks to go up:
– a minimum wage increase is struck down
– employees are prevented from unionizing
– corporate taxes are reduced
– labor laws are relaxed
The stock market is not the economy, it’s an estimate of how much wealth can be extracted from workers.
— Existential Comics (@existentialcoms) January 12, 2020
Today the number of COVID-19 cases worldwide reached 100,000, with 3,461 recorded deaths. In response, the Himalayan nation of Bhutan closed its doors to tourists altogether, Starbucks announced it would no longer allow customers to use their own cups due to concern about contagion, and the world’s smallest country, the Vatican, recorded its first case of coronavirus. In the U.S., 259 people have been infected, and 14 have died.
While emergency funding to combat the virus will be passed today, the American response has not been swift. Workers have not been guaranteed full sick pay while quarantining, leading to a situation where many poorer citizens will have to choose between doing the right thing and going broke. A Miami resident returning from China was presented with a $3,500 bill after reporting his flu-like symptoms to medical staff, leading to fears that a lack of universal healthcare will help the virus spread. Analysts, however, appear more concerned about the health of stock prices than the health of the nation. CNBC’s Rick Santelli suggested infecting the entire population with COVID-19 so nobody would have an excuse to miss work, thus effectively sacrificing the country for the sake of the economy. While there are many economic steps the United States could take to help the situation, deregulating Wall Street might not be the most necessary.
Feature photo | A pedestrian wears a surgical mask on a busy street in mid-town Manhattan, as concerns grow around coronavirus, March 3, 2020, in New York. Bebeto Matthews | AP
Alan MacLeod is a Staff Writer for MintPress News. After completing his PhD in 2017 he published two books: Bad News From Venezuela: Twenty Years of Fake News and Misreporting and Propaganda in the Information Age: Still Manufacturing Consent. He has also contributed to Fairness and Accuracy in Reporting, The Guardian, Salon, The Grayzone, Jacobin Magazine, Common Dreams the American Herald Tribune and The Canary.
Much ado about nothing.
27 children have died from the flu this year. Zero have died from Corona Virus. In fact, Corona seems to be killing old people, most of whom were former smokers or who had other lung issues.
Corona is killing the economy more than it’s killing people. Well, let’s be honest – the corporate media is killing the economy. It’s all they have to take out Trump.
I do hope Corona spreads and becomes more fatal. We have a lot of Baby Boomers in this country that need to go. Plus, if enough of them die, housing prices will fall. That’ll help out a lot of struggling millenials, you know…the group that’s waiting for the Boomers to leave the stage so they can finally get a real job and a decent place to live.