Job Losses, Bankruptcies And Store Closings Are All At Apocalyptic Levels As The U.S. Economic Collapse Rolls On

The last four months have been an unending nightmare for the U.S. economy.  Businesses are shutting down at a pace that we have never seen before in American history, the “retail apocalypse” has reached an entirely new level that none of the experts were anticipating prior to this pandemic, and we are in the midst of the greatest spike in unemployment that the United States has ever experienced.  On Thursday, we learned that another 1.3 million Americans filed new claims for unemployment benefits last week, and that number has now been above one million for 16 consecutive weeks.  Things were supposed to be “getting back to normal” by now, buy that hasn’t happened.  Instead, we continue to see a tsunami of job losses that is absolutely unprecedented in American history.

When we look back at the old peaks for unemployment claims, they almost seem laughable compared to what we are experiencing now…

The highest prior weekly total for new unemployment claims was 695,000, in October 1982, according to Labor Department data. During the Great Recession, the country’s last downturn, weekly claims peaked at 665,000, in March 2009.

For those that aren’t old enough to remember, the recession of the early 1980s and the recession of 2008 and 2009 were both really, really painful.

But of course they weren’t anything like this.

Sometimes it is hard to believe that the numbers have gotten so bad.  According to Wolf Richter, the number of continuing claims that were filed last week under all state and federal unemployment programs is the highest that we have ever seen…

The total number of people who continued to claim unemployment compensation in the week ended July 4 under all state and federal unemployment insurance programs, including gig workers, jumped by 1.41 million people, to 32.92 million (not seasonally adjusted), the Department of Labor reported this morning. It was the highest and most gut-wrenching level ever.

The number of people who continue to receive state unemployment insurance (blue columns) has been ticking down, as more people got their jobs back than newly unemployed flooded the state unemployment systems. But the number of people claiming federal unemployment insurance, including gig workers under the Pandemic Unemployment Assistance (PUA) program, continues to surge (red columns), which causes the total number of people claiming unemployment benefits under all programs to rise

Up to this point, the emergency measures that Congress put in place to help unemployed workers have definitely eased the pain for millions upon millions of people that have lost their jobs, but a number of those emergency measures are about to expire

Several benefits were developed in March to help ease the financial strains on Americans during the coronavirus pandemic. Those are set to come to an end before July 31, which could impact 20 million Americans, MarketWatch reports. The CARES Act, which was signed into law on March 27 by President Donald Trump, provided benefits like enhanced unemployment payments to supplement lost income from layoffs. It also includes a clause to delay evictions for 120 days.

Of course Congress could choose to extend some or all of the elements in the CARES Act, but that would mean borrowing and spending more giant mountains of money that we do not currently have.

Meanwhile, we are seeing businesses fail at a rate that is absolutely staggering.

According to the Washington Post, more than 100,000 businesses have permanently closed their doors during this pandemic, and Bloomberg just posted an article about 110 major companies that have declared bankruptcy here in 2020…

Retailers, airlines, restaurants. But also sports leagues, a cannabis company and an archdiocese plagued by sex-abuse allegations. These are some of the more than 110 companies that declared bankruptcy in the U.S. this year and blamed Covid-19 in part for their demise.

Sadly, the bankruptcy announcements just keep on coming.

This week, we learned that Brooks Brothers has filed for bankruptcy protection

The coronavirus pandemic has now claimed one of the country’s oldest and most prestigious retailers.

Brooks Brothers — pioneer of the polo and uniform of the polished prepster — filed for Chapter 11 bankruptcy court protection from creditors on Wednesday, as it continues to search for a buyer.

That hit me particularly hard, because I have had Brooks Brothers shirts in my closet ever since I was a young man.

They have always made great products, and I just assumed that they would always be around.

Of course lots of other iconic retailers are failing as well.  Before too long, naming the major retailers that are still operating successfully may be easier than trying to name the vast number of major retailers that have gone belly up.

Store closings are happening fast and furious these days, and that isn’t likely to change any time soon.  Starbucks just announced that they will be closing 400 locations, Dunkin’ Donuts just announced that they will be closing 450 locations, and Bed Bath & Beyond has increased the number of stores that they will be closing to approximately 200

Bed Bath & Beyond (BBBY) announced Wednesday that it plans to close roughly 200 stores in the next two years.

The retail chain — which also operates Buybuy Baby, Christmas Tree Shops and Harmon Face Values — said it would be mainly closing Bed Bath & Beyond stores, starting later this year. The announcement came as the company released its quarterly earnings report on Wednesday.

If you are still not convinced that the retail industry is facing an unprecedented cataclysm, I think that the following list will do the trick.

Forbes has been tracking the major store closing announcements of 2020, and their list was recently shared by Zero Hedge

Forbes’ Store Closure List In 2020

Chuck E Cheese: 54 U.S. stores (bankruptcy)

Destination Maternity: 90 stores (bankruptcy)

GNC: 1,200 stores (bankruptcy)

J. Crew: 54 stores (bankruptcy)

JCPenney JCP: 154 stores (bankruptcy)

K-Mart: 45 stores (bankruptcy)

Modell’s Sporting Goods: 153 stores (bankruptcy)

Neiman Marcus (Last Call): 20 stores (bankruptcy)

Papyrus: 254 stores (bankruptcy)

Pier 1 Imports PIR: 936 stores (bankruptcy)

Sears: 51 stores (bankruptcy)

Signet Jewelers SIG: 232 stores

Stage Stores: 738 stores (liquidating)

Tuesday Morning: 230 stores (bankruptcy)

***

AC Moore: 145 stores

Art Van Furniture: 190 stores

AT&T: 250 stores

Bath & Body Works: 50 stores

Bed Bath & Beyond: 44 stores

Bloomingdale’s: 1 store

Bose: 11 stores

Chico: 100 stores (estimated)

Children’s Place: 200 stores

Christopher Banks: 30-40 stores

CVS Pharmacy: 22 stores

Earth Fare: 50 stores

Express: 66 stories

Forever 21: 15 stores (estimated)

GameStop GME: 320 stores

Gap: 230 stores

Guess: 100 stores

Hallmark: 16 stores

Lord & Taylor: 30 or 40 stores

Lowe’s Canada: 34 stores

Lucky Market: 32 stores

Macy’s M: 125 stores (over 3 years)

Microsoft: 77 stores

New York & Co: 27 stores

Nordstrom: 16 stores

Office Depot: 90 stores

Olympia Sports: 76 stores

Party City: 21 stores

Starbucks SBUX: 400 stores (over 18 months)

Victoria’s Secret: 250 stores

Walgreen: 100 stores (estimated)

Walmart: 2 stores

Wilson Leather & G.H. Bass: 199 stores

Zara: 1,000 stores worldwide (over 2 years)

This week, the number of newly confirmed cases of COVID-19 has surged to the highest level that we have seen yet, and that means that fear of COVID-19 is going to continue to paralyze economic activity in the United States for the foreseeable future.

That means that many more businesses will be shutting their doors, there will be many more bankruptcies, and millions more Americans will be losing their jobs.

This is what an economic collapse looks like, and it is just getting started.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

The U.S. Economy Hasn’t Experienced Anything Like This Since The Great Depression Of The 1930s

The recession of 2008 and 2009 was bad, but it was nothing like this.  Even though this new economic downturn is only a few months old, we are already seeing numbers that we haven’t seen since the worst parts of the Great Depression of the 1930s.  More than 48 million Americans have filed new claims for unemployment benefits over the past 15 weeks, well over 100,000 businesses have permanently closed their doors, and civil unrest has turned quite a few of our major cities into war zones.  But not all areas of the country are being affected equally.  For example, there are rural areas that haven’t really seen a lot of COVID-19 cases where life seems to have changed very little from six months ago.  On the other hand, some urban areas that have been hit really hard by COVID-19 have been absolutely devastated economically.  For example, the New York Times is reporting that a million jobs have been lost in New York City, and the unemployment rate for NYC “is hovering near 20 percent”

The city is staggering toward reopening with some workers back at their desks or behind cash registers, and on Monday, it began a new phase, allowing personal-care services like nail salons and some outdoor recreation to resume. Even so, the city’s unemployment rate is hovering near 20 percent — a figure not seen since the Great Depression.

We are going to be using the phrase “since the Great Depression” a lot in the coming months.

Fear of COVID-19 is going to paralyze our economy for the foreseeable future, and all of this fear is hitting some companies more severely than others.  On Tuesday, Levi Strauss announced that sales were down a whopping 62 percent during the second quarter

The denim maker Levi Strauss & Co.’s sales fell 62% during its fiscal second quarter, the company announced Tuesday, as its online sales weren’t enough to make up for its stores being temporarily shut for roughly 10 weeks during the Covid-19 crisis.

If Levi Strauss expected this to be just a temporary setback, they would probably try to keep all of their employees on board.

But instead, they apparently believe that hard times are here to stay and they have just decided to eliminate “about 700 jobs”

Levi’s also announced it will be slashing about 15% of its global corporate workforce, impacting about 700 jobs, in a bid to cut costs during the coronavirus pandemic. It said the move should generate annualized savings for Levi’s of $100 million.

Of course a whole lot of other companies are laying off workers right now too.  Another 1.427 million Americans filed new claims for unemployment benefits last week, and that is an absolutely catastrophic number.  Prior to 2020, the worst week in all of U.S. history for new unemployment claims was in 1982 when 695,000 unemployed workers filed in a single week.  So what we are witnessing right now is nothing short of a “tsunami of job losses”, and even CNN is admitting that millions of the jobs that have been lost “are never coming back”…

The American economy’s unprecedented jobs rebound masks a difficult truth: For millions of people, the jobs they lost are never coming back.

“It’s clear that the pandemic is doing some fundamental damage to the job market,” said Mark Zandi, chief economist for Moody’s Analytics. “A lot of the jobs lost aren’t coming back any time soon. The idea that the economy is going to snap back to where it was before the pandemic is clearly not going to happen.”

I couldn’t have said it better myself.

Since most Americans were living paycheck to paycheck before this pandemic erupted, millions of unemployed workers have found themselves in desperate need very suddenly.  I have written numerous articles about the massive lines that we have been witnessing at food banks around the nation, and we just witnessed another two mile long line at a food bank in Florida

More than 700 cars were seen waiting in a two-mile long food bank line in Florida as the US grapples with nearly half of Americans being unemployed amid a spike in new coronavirus cases that has sparked fears of more shut downs and lay-offs.

Sunrise Assistant Leisure Services Director Maria Little, who was put in charge of food distribution for the city when the coronavirus hit the US in March, said her group served about 720 cars in Miami on Wednesday.

This is not what a “recovery” looks like.

In fact, for certain sectors of the economy the numbers are rapidly getting a lot worse.  For instance, just check out what CNBC is reporting

Delinquencies in commercial mortgage-backed securities last month had their largest one-month surge since Fitch Ratings began tracking the metric nearly 16 years ago.

The delinquency rate hit 3.59% in June, an increase from 1.46% in May. New delinquencies totaled $10.8 billion in June, raising the total delinquent pool to $17.2 billion.

And Fitch Ratings is warning that these numbers are going to get far worse in the months ahead.

And this is just the beginning. Fitch analysts are projecting that the impact from the coronavirus pandemic will drive the delinquency rate to between 8.25% and 8.75% by the end of the third quarter of this year.

I have said this before, and I will say it again.

We are on the verge of the biggest commercial mortgage meltdown in the history of the United States.

Countless restaurants and retailers are getting way behind on their rent payments, and as a result many owners of commercial property are finding it increasingly difficult to make their mortgage payments.

The dominoes are starting to fall, and this is going to get really, really messy as we head into 2021 and beyond.

Of course the same thing could be said for the U.S. economy as a whole.

I know that I haven’t been posting quite as often the last couple of weeks, and that is because I have been finishing my new book.  It is not too far from being completed, and it is going to be the most important thing that I have written so far.

We are right on the precipice of the most chaotic chapter in all of American history, and a collapsing economy is just going to be one element of “the perfect storm” that we are facing.

So please use the summer months to get prepared for what is ahead, because even though things are bad right now, the truth is that we have only experienced the leading edge of “the perfect storm” so far.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

The Good, The Bad And The Ugly From The Latest U.S. Employment Numbers

Is the U.S. economy starting to rebound from the massive downturn that the coronavirus lockdowns caused?  Some new employment numbers were released on Thursday, and they were very interesting.  Many are boldly declaring that these new numbers are fantastic news for the U.S. economy, but that is greatly oversimplifying matters.  So far in 2020, tens of millions of Americans have lost their jobs, and we knew that millions of those jobs would eventually come back as COVID-19 restrictions were lifted.  And on Thursday, we received confirmation that millions of those jobs are indeed coming back

Nonfarm payrolls soared by 4.8 million in June and the unemployment rate fell to 11.1% as the U.S. continued its reopening from the coronavirus pandemic, the Labor Department said Thursday.

Without a doubt, this is good news.  But it also appears that the numbers are not entirely accurate, and we will discuss that more in just a bit.

But first, I wanted to point out that the main reason why payrolls rose by 4.8 million was because the number of Americans that were classified as being temporarily laid off declined by 4.8 million last month.  At the same time, the number of permanent job losses last month actually rose by more than half a million compared to the month before…

Another big contributor to the decline of the jobless rate was a plunge in those on temporary layoff. That total fell by 4.8 million in June to 10.6 million after a decrease of 2.7 million in May. The short-term jobless level fell by 1 million to 2.8 million.

However, those reporting permanent job losses also jumped, rising by 588,000 to 2.883 million, the highest level in more than six years.

This is clearly bad news.  It was expected that millions of those that had been temporarily laid off would start going back to their old jobs, but what we didn’t expect was a huge spike in the number of permanent job losses.

And now let’s get to the “ugly” portion of the numbers.

On Thursday, we learned that 1.427 million more Americans filed new claims for unemployment benefits last week, and the number of unemployed workers filing continuing claims actually went up…

Indeed, new jobless claims remained stubbornly high last week, with another 1.427 million Americans filing, above the estimate of 1.38 million, the Labor Department said in a separate report Thursday. Continuing claims actually increased by 59,000 to 19.3 million, highlighting the jobless problem likely exacerbated by the ongoing presence of the virus and its economic impact.

That is not what a “recovering” economy looks like.

In fact, those numbers are absolutely abysmal.

I keep reminding my readers that prior to this year the all-time record for new unemployment claims was set in 1982 when 695,000 Americans filed in a single week.  The number for last week was more than double that old record, and we have now more than doubled that old record for 15 weeks in a row.

Can anyone out there explain to me how the economy is possibly “recovering” when Americans continue to file for unemployment at levels that are way beyond anything that we have ever seen before in all of U.S. history?

Overall, more than 48 million Americans have now filed new claims for unemployment benefits over the past 15 weeks.

But the Bureau of Labor Statistics would have us believe that only 17.75 million Americans are currently unemployed even though the number of Americans that are filing continuing claims for unemployment is far greater than that.  This point was brilliantly made by Zero Hedge earlier today…

By its very definition, insured unemployment is a subset of all Americans who are unemployed. In a Venn diagram, the Continuing Claims circle would fit entirely inside the “Unemployed” circle, which also includes Initial Claims, Continuing Claims, and countless other unemployed Americans who are no longer eligible for any benefits.

Alas, as of this moment, the definitionally smaller circle is bigger than “bigger” one, and as the DOL reported todaythere were 19.29 million workers receiving unemployment insurance. And yet, somehow, at the same time the BLS also represented that the total number of unemployed workers is, drumroll, 17.75 million.

If you said this makes no sense, and pointed out that the unemployment insurance number has to be smaller than the total unemployed number, then you are right. And indeed, for 50 years of data, that was precisely the case.

By putting out such absurd numbers, the BLS is starting lose any credibility that it had left, and that is incredibly sad.

Meanwhile, fear of the coronavirus is causing some states to start instituting fresh restrictions, and it appears that this is causing U.S. economic activity to slow down once again

High-frequency data assembled by Federal Reserve officials, economists, cellphone tracking companies, and employee time management firms suggests activity slowed in recent days, clouding a strong U.S. employment report that may prove to have been driven by an exuberant start to the month as states reopened.

In other words, we should expect the economic numbers for July to be quite dismal.

Right now, a fresh wave of fear is sweeping across the nation.  The number of confirmed cases of COVID-19 has surged dramatically in recent days, and according to Gallup more Americans than ever believe that the pandemic is “getting worse”…

As coronavirus infections are spiking in U.S. states that previously had not been hard-hit, a new high of 65% of U.S. adults say the coronavirus situation is getting worse. The percentage of Americans who believe the situation is getting worse has increased from 48% the preceding week, and from 37% two weeks prior.

What this means is that economic activity is going to remain at very depressed levels for the foreseeable future.

Without enough revenue coming in, more businesses will fail and more workers will lose their jobs.  Without jobs, many Americans will not be able to pay their bills, and this will put an immense amount of pressure on financial institutions.

The truth is that the economic outlook has not improved one bit.  If anything, it has actually deteriorated over the past couple of weeks.

Fear of COVID-19 has plunged us into a new economic depression, and it looks like fear of COVID-19 will keep us in one for the rest of 2020 and beyond.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Close To Half Of All Working Age Adults In The United States Do Not Have A Job Right Now

There is a lot of talk about the “unemployment rate” these days, but the way that it is calculated has become so convoluted that it is not really that meaningful anymore.  Even during the so-called “good times”, more than 100 million U.S. adults were not working, but we were told that the unemployment rate was the lowest that it had been in decades.  Of course now everything has changed.  Since this pandemic began, more than 47 million Americans have filed new claims for unemployment benefits, and the mainstream media is going to make sure that fear of COVID-19 continues to paralyze our society for the foreseeable future.

In this article, I would like to discuss the employment-population ratio.  According to Wikipedia, the employment-population ratio is “a statistical ratio that measures the proportion of the country’s working age population that is employed”.  I believe that it is a far more accurate measurement than the “unemployment rate” is, and we have seen this ratio move quite dramatically over the past couple of months.  According to CNBC, the employment-population ratio hit 52.8 percent in May, and that means that 47.2 percent of all working age Americans did not have a job…

Nearly half of the population is still out of a job showing just how far the U.S. labor market has to heal in the wake of the coronavirus.

The employment-population ratio — the number of employed people as a percentage of the U.S. adult population — plunged to 52.8% in May, meaning 47.2% of Americans are jobless, according to Bureau of Labor Statistics. As the coronavirus-induced shutdowns tore through the labor market, the share of population employed dropped sharply from a recent high of 61.2% in January, farther away from a post-war record of 64.7% in 2000.

As you can see on this chart, we are definitely in unchartered territory.

We have never seen a collapse of this magnitude in all of U.S. history, and it has been truly horrifying to watch so many people lose their jobs.

It would be difficult to overstate just how far we have fallen.  One analyst has pointed out that it would take 30 million new jobs for the employment-population ratio to return to the peak that we witnessed all the way back in 2000…

“To get the employment-to-population ratio back to where it was at its peak in 2000 we need to create 30 million jobs,” Torsten Slok, Deutsche Bank’s chief economist, said in an email.

Of course before we can start adding jobs we have got to stop the bleeding first, and at this point more than a million Americans continue to file new claims for unemployment benefits each and every week.

And more job losses are coming, because companies are shutting down at a staggering rate.  In fact, this week USA Today warned that “experts believe this is just the beginning of a bankruptcy tsunami that will wash over the country’s largest companies this summer”…

Twelve midsize to large corporations – all with more than $10 million in debt – filed for Chapter 11 bankruptcy protection during the third week of June, another consequence of the coronavirus pandemic and continued trouble in America’s oil industry.

The filings represent the highest weekly total of the year, and experts believe this is just the beginning of a bankruptcy tsunami that will wash over the country’s largest companies this summer and then drench both smaller businesses and individuals if government stimulus money dries up.

Those two paragraphs almost sound like something that I could have written.

But at this point it is very difficult for anyone to deny how bad things have become.  So many firms are suddenly going bankrupt that it is impossible to keep up with them all, and the energy industry is being hit particularly hard

At least 24 oil and gas companies filed from April through June – nearly twice as many as during the first three months of the year, according to Haynes and Boone LLP, an international law firm based in Texas. Four of those companies – Texas-based NorthEast Gas Generation, Colorado-based Extraction Oil & Gas, and Chisolm Oil and Gas and Chesapeake Energy, which are both from Oklahoma – filed in the last two weeks of June.

“This trend should continue through the remainder of 2020 and into 2021,” said Charles Beckham, a partner in Haynes and Boone’s restructuring practice.

Of course it isn’t just the U.S. that is experiencing severe economic pain.

COVID-19 has paralyzed economies all over the planet, and global trade has dropped precipitously

World trade in goods plunged by 12% in April from March, after having already dropped 2.4% in March from February. This plunge of the Merchandise World Trade Monitor, released by CPB Netherlands Bureau for Economic Policy Analysis, was by far the largest month-to-month drop in the history of the data going back to 2000.

For such a long time, many were warning that “the next global depression” was coming, and now it is here.

Many of the economic optimists had been hoping for a very short downturn followed by a “V-shaped recovery”, but now it has become clear that is simply not going to happen.

The primary factor dragging our economy down is fear of COVID-19, and the mainstream media continues to add to that fear day after day.

Over the past couple of weeks, we have seen a surge of new cases in some portions of the U.S., and this has caused quite a few states to put a hold on their reopening plans

At least 14 states have paused or rolled back their reopening plans as the United States sees a surge in coronavirus cases across the country.

With July 4 celebrations approaching, officials are trying not to repeat scenes from Memorial Day, when thousands flocked to beaches, bars and parties while experts cautioned that crowds could lead to spikes in cases down the road.

I wish that I could tell you that things will soon get much better for the U.S. economy, but I can’t.

Yes, there will be ups and downs during the months ahead, but a return to “normal” is certainly not in the cards.

So I would definitely encourage everyone to use this window of opportunity to get prepared for rough times ahead, because we are about to see things happen that we have never seen before.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Any Hope For A “V-Shaped Recovery” Has Been Completely Crushed

We were supposed to be well into a “recovery” by now, but instead more bad economic news just keeps pouring in.  In fact, the numbers that I am going to share with you in this article are absolutely eye-popping.  Initially, many of the economic optimists had been trying to convince us that we would experience a “short, sharp recession” followed by a “V-shaped recovery”.  Well, at this point it has become quite clear that we can forget all about that scenario.  The mainstream media is increasingly starting to use the word “depression” to describe what is happening to the U.S. economy, and the raw numbers definitely support the use of that label.  For example, the Atlanta Fed’s GDPNow model is now projecting that U.S. GDP will decline by 46.6 percent on an annualized basis during the second quarter of 2020…

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2020 is -46.6 percent on June 25, down from -45.5 percent on June 17. After this week’s data releases from the U.S. Census Bureau, the U.S. Bureau of Economic Analysis, and the National Association of Realtors, a decrease in the nowcast of second-quarter real residential investment growth from -25.9 percent to -35.9 percent was offset by an increase in the nowcast of real business fixed investment growth from -31.1 percent to -28.2 percent, while the nowcast of the contribution of the change in net exports to second-quarter real GDP growth decreased from 0.30 percentage points to -1.27 percentage points.

If that figure is anywhere close to accurate, this quarter will be remembered as the most disastrous economic quarter that we have ever seen in all of U.S. history up to the point.

Meanwhile, the number of Americans filing new claims for unemployment benefits each week continues to surprise most analysts

Jobless claims totaled 1.48 million last week as unemployment related to the coronavirus pandemic remained stubbornly high, though those receiving benefits fell below 20 million for the first time in two months, the government reported Thursday.

Economists surveyed by Dow Jones had been expecting 1.35 million claims.

As I keep reminding my readers, the all-time record for a single week prior to this year was just 695,000, and that record had stood since 1982.

But now we have more than doubled that old record for 14 weeks in a row.

Just think about that.  After laying off tens of millions of workers, you would think that companies would be running out of people to fire, but we continue to see vast hordes of Americans file new claims for unemployment benefits each week.

Overall, more than 47 million Americans have now filed a claim for unemployment benefits since this pandemic began.

If this isn’t an “economic depression”, then how bad would things have to get for us to be in one?

Of course Congress certainly didn’t help matters by giving out such generous unemployment bonuses.  Millions of unemployed workers are now bringing home more money than they did while they were actually working, and this is discouraging many from returning to work.

But that will change very abruptly in just a few weeks

Many out-of-work Americans counting on receiving an extra $600 a week through the end of July may be surprised to discover that benefit will disappear nearly a week earlier than they expected.

The additional $600 in weekly jobless benefits provided by the federal government is officially set to end July 31. But states will pay it only through the week ending July 25 or July 26, a significant blow to unemployed workers counting on that money to bolster state benefits that average just $370 a week.

Starting around the beginning of August, all of a sudden a whole lot of people will be very interested in finding new jobs, but there won’t be many jobs available.

Thousands upon thousands of businesses have already shut down permanently, and more are closing their doors with each passing day.

This new economic downturn has been particularly brutal for small businesses.  Just consider the following numbers from the Wall Street Journal

Roughly 140,000 Yelp-listed businesses that had closed since March 1 remained closed on June 15. A large minority of that set, 41%, has shut for good, according to Yelp.

The figures have improved by about 20% compared with April data, when 175,000 businesses were closed. But the large share of persistent closures, which were spread nationwide, showed the pandemic’s stubborn hindrance to life as normal even as all 50 states have taken steps to reopen.

This isn’t what a “recovery” looks like.

And it isn’t just the private sector that will be shedding jobs like crazy in the months ahead.  As tax revenues collapse, state and local governments all over the nation will be forced to let workers go.  In fact, it is being projected that more than 5 million of them will be laid off…

Right now, sales taxes, real-estate-transfer taxes, income taxes, fines and fees—they are all collapsing, leaving local governments with a budget gap expected to total $1 trillion next year. Without help from Washington, this will necessarily mean massive service cuts and job losses: namely, an estimated 5.3 million job losses.

Those are not jobs that have already been lost.

Those are future job losses that haven’t shown up in the numbers yet.

And those job losses will be particularly painful, because government jobs tend to pay higher than average wages and they tend to come with better than average benefits.

As the job loss tsunami continues to roll on, the number of Americans forced to move back home with their parents or grandparents will continue to soar.  Of course what we have been witnessing already is deeply alarming

A record 32 million American adults were living with their parents or grandparents in April, according to the latest American Community Survey from the U.S. Census Bureau, an increase of 9.7 percent over a year ago. The data, analyzed by Zillow researchers, showed that 2.7 million adults moved back home in March and April, and that about 2.2 million of them were aged 18 to 25 — also known as Generation Z.

One domino after another is tumbling, and obviously economic conditions are not going to return to the way they were previously.

But this wasn’t supposed to happen.

Once the coronavirus lockdowns ended, we were told that the U.S. economy was supposed to snap back very rapidly.

Unfortunately, the truth is that our economic pain is just beginning.  We have entered an extended economic downturn, and our society is not equipped to handle such a downturn at all.

As I have warned so many times, what we are facing is going to make the last recession look like a Sunday picnic, but most Americans continue to hold out hope that some sort of a “recovery” is still on the horizon.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

Media-Induced Fear Of COVID-19 Is Starting To Cause A Second Wave Of Severe Economic Panic

Fear of COVID-19 absolutely crippled the U.S. economy during the first half of this year, and now it appears that there are some people that are pushing for that to happen again during the second half of 2020.  Earlier this evening, I came across a headline that boldly declared that there will be “180,000 U.S. deaths of COVID-19 by October”, and right now just about every mainstream news outlet is running stories about how the number of confirmed cases in the U.S. is surging.  And it is definitely true that we are seeing an alarming rise in the number of confirmed cases.  In fact, the number of new cases in the U.S. on Wednesday set a new record

The U.S. broke its record for the highest coronavirus cases recorded in a single day, with 36,358 new positives reported on Wednesday, according to a tally by NBC News.

Wednesday’s cases top the previous highest day count from April 26 — the first peak of the pandemic in the U.S. — by 73 cases, according to NBC News tracking data. The World Health Organization saw its single-day record on Sunday with more 183,000 cases worldwide.

The mainstream media is treating this as some sort of a big shock, but of course the truth is that this shouldn’t be a surprise to anyone.

For months, I have been telling my readers that the lockdowns would “flatten the curve” for a while and that the number of cases would start to spike again once the lockdowns ended.  That is exactly what has happened, but anyone with even a little bit of common sense could have anticipated this.

Earlier this year, states in the northeastern portion of the nation were the epicenter for the outbreak in this country, but now it is states in the southern and western sections of the nation that have become the most prominent hotspots…

Arizona, California, Texas, Florida, Oklahoma and South Carolina reported record-high new daily coronavirus cases during this week, as case counts continue to rise in more than half of U.S. states.

Texas Governor Greg Abbott said the state is facing a massive outbreak with another 5,000 cases reported Wednesday. California Gov. Gavin Newsom reported Wednesday 7,149 tested positive, a record number for the nation’s largest state. Both states this week surpassed the entire European Union on the average number of daily cases.

Things are particularly bad in California.  Over the past two days, we have seen a 69 percent increase in the number of newly confirmed cases…

The California Department of Public Health reported its second straight record jump in coronavirus cases on Wednesday as the state joins a handful of others with growing case numbers.

California reported an additional 7,149 Covid-19 cases since Tuesday, a 69% increase in two days, bringing the state’s total to 190,222 cases, according to the state’s health department. The previous highest day jump was reported on Tuesday when the state recorded 5,019 additional new cases.

Needless to say, the snowflake politicians in California are going to be even less eager to return to business as usual than they were before.  And since the state of California accounts for more economic activity than any other U.S. state does, this is going to be a major drag on the U.S. economy as a whole.

If this pandemic keeps dragging on for a couple more years, what are states like California going to do?  Many had anticipated that life would be getting back to normal by now, but instead we are starting to see things go in reverse.  In fact, we just learned that the reopening of Disneyland has been postponed indefinitely

Disney is delaying the phased reopening of Disneyland and Disney California Adventure, the company’s flagship theme parks in California, the company said on Wednesday.

The resort, located in Anaheim, California, was set to welcome back guests on July 17 after being closed for months because of the coronavirus pandemic.

Other very large corporations are making similar moves.  For example, Apple just shut down a whole bunch of their stores because of this new surge in coronavirus cases

On Friday, stocks slumped as second wave fears were reignited following a report that Apple would temporarily shutter 11 U.S. retail stores across Florida, Arizona, North Carolina and South Carolina.”Due to current COVID-19 conditions in some of the communities we serve, we are temporarily closing stores in these areas,” an Apple spokesman said in a statement.“We take this step with an abundance of caution as we closely monitor the situation and we look forward to having our teams and customers back as soon as possible.”

Fast forward to today, when with stocks already sliding on renewed virus of a second wave of virus infections, moments ago Apple reported that it would re-close another 7 stores in Houston and Texas due to the coronavirus spike.

According to the optimists, this wasn’t supposed to happen.  The worst part of this pandemic was supposed to be over, and it was supposed to be all downhill from here.

But instead it has become exceedingly clear that this virus will be with us for a long time to come.  New York, New Jersey and Connecticut have all announced that those traveling in from nine different states where COVID-19 is out of control will be forced into mandatory quarantine for 14 days, and police in New York will actually be actively searching for vehicles that have license plates from those particular states…

In New York, cops will stop cars with license plates from the affected states to ask the person why they are not quarantining and how long they have been in the state for.

The quarantine applies to any state with infection rate of 10 infections per 100,000 people on a seven day rolling average or 10 percent of the total population testing positive.

Speaking of New York, this pandemic has already had a much larger financial impact than most observers had anticipated.

In particular, New York City is facing a nine billion dollar reduction in tax revenue, and Mayor Bill de Blasio says that the city may be forced to let 22,000 workers go

New York Mayor Bill de Blasio said the city is considering 22,000 layoffs and furloughs among its 326,000 employees to cut $1 billion of expenses after lockdown-related revenue losses.

De Blasio has projected a $9 billion loss in tax revenue over the next two years because of the pandemic.

Sadly, a whole lot more government workers will be fired across the country before this crisis is over.

Of course things are even worse for the private sector, and we continue to get more examples of this every single day.  On Tuesday, we learned that GNC has decided to declare bankruptcy

GNC Holdings Inc., which filed for Chapter 11 bankruptcy protection late Tuesday, has released an initial list of stores that will close.

The list posted at the Pittsburgh-based chain’s site, GNCevolution.com, includes 248 closing stores, including 219 U.S. locations and 29 in Canada.

And we have also just learned that the end may be near for Chuck E. Cheese

The coronavirus pandemic could spell the end of Chuck E. Cheese. The popular kid’s restaurant had to close its 610 locations nationwide during the outbreak. Now, $1 billion in debt has Chuck E. Cheese’s parent company, CEC Entertainment, approaching bankruptcy.

The Wall Street Journal reports that CEC is asking lenders for a $200 million to keep its business going.

I haven’t been to a Chuck E. Cheese in many years, but when I was a kid I absolutely loved to eat there.

As a youngster, it seemed like such a magical place, and now it deeply saddens me to hear that the company may not survive.

In the end, a lot more iconic companies will go under as America plunges even deeper into this new economic depression.

Fear of a virus has turned our economy completely upside down, and thanks to the mainstream media much of the population is going to remain deathly afraid of this virus for the foreseeable future.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with as many people as we possibly can.

As The Stock Market Soars, The Numbers Say That The Real Economy Is In The Midst Of A Historic Crash

Have you been watching the madness that has been unfolding on Wall Street?  Even though we are in the middle of the worst global pandemic in 100 years, and even though rioters and looters have been turning our major cities into war zones, stock prices have been going up day after day.  In fact, the Nasdaq closed at an all-time record high on Monday.  Sometimes people ask me to explain this rationally, and I can’t, because the Federal Reserve has transformed our “financial markets” into a total mockery at this point.  The real economy is literally collapsing all around us, but thanks to Fed intervention stock investors are doing just fine.  It has been absolutely disgusting to watch, and if Adam Smith could see what was happening he would be rolling over in his grave.  Unfortunately, thanks to our rapidly declining system of education most Americans don’t even know who Adam Smith is anymore.

I can’t recall another time in modern U.S. history when stock prices skyrocketed as the U.S. economy plunged into a recession.  What we have been witnessing has truly been extremely bizarre, and it will be fascinating to see how long it can last.

Meanwhile, the real economy is a giant mess.  On Monday, the National Bureau of Economic Research finally got around to letting us know that a recession has officially begun

It’s official: The United States is in a recession.

The National Bureau of Economic Research said Monday the U.S. economy peaked in February, ending the longest expansion in U.S. history at 128 months, or about 10½ years.

In truth, the announcement codifies the painfully obvious. States began shutting down nonessential businesses in mid-March to contain the spread of the coronavirus, halting about 30% of economic activity and putting tens of millions of Americans out of work.

And in other news, the sky is blue and the moon is not made out of cheese.

Anyone with half a brain can see that the economy is falling apart.  For example, we just learned that U.S. factory orders were down 22.3 percent in April compared to a year earlier…

Having collapsed by a record 10.4% MoM in March, April factory orders were expected to accelerate even lower and it did. However, the 13.0% plunge in April was modestly better than the 13.4% MoM drop expected… but is still the worst in American history.

Year-over-year, factory orders collapsed 22.3% – the worst since the peak of the financial crisis.

Of course it is not that difficult to find a number that is even worse than that.

Just look at heavy truck sales.  Last month they were down a whopping 37 percent from the same month in 2019…

The last three months have been catastrophic for segments of the trucking business, after an already tough period that started in late 2018. In May, orders for Class 8 trucks – the heavy trucks that haul much of the goods-based economy across the US – plunged 37% from the  low levels in May a year earlier, and by 81% from May two years ago, to 6,600 orders, according to estimates by FTR Transportation Intelligence today.

Not to be outdone, the number of corporate bankruptcies shot up 48 percent last month compared to the same period a year ago…

Corporate bankruptcies spiked during May as the coronavirus pandemic slammed the U.S. economy, pushing the number of filings to levels recorded in the wake of the 2007-09 recession.

U.S. courts recorded 722 businesses nationwide filing for chapter 11 protection last month, a yearly increase of 48%, according to figures from legal-services firm Epiq Global.

But every time we get another horrific economic figure, the stock market goes even higher.

The worse the news gets, the more investors seem to like it.  Week after week, we have seen unprecedented numbers of Americans file for unemployment benefits, and at this point a grand total of more than 42 million Americans have lost a job since this pandemic began.

And yet investors keep taking these job losses as signs that they should buy even more stocks.

Perhaps someone should spread a rumor that a planet-killing asteroid is about to hit us, because that would probably really get investors salivating.

Of course most ordinary Americans don’t get to live in a Fed-fueled fantasy world, and this new economic downturn is hitting most of them extremely hard.

In fact, it is being reported that approximately a third of all Americans “are now showing signs of clinical anxiety and depression”…

In the wake of the COVID-19 pandemic and resulting economic crash, which triggered depression-like unemployment with 40 million initial claims filed in ten weeks, a third of Americans are now showing signs of clinical anxiety and depression, according to new data collected by the Census Bureau. This, by far, is the most comprehensive and troubling sign yet of the psychological toll inflicted on Americans due to months of lockdowns.

The Census Bureau contacted one million households between May 7 and 12, and about 42,000 responded, said The Washington Post. The survey was about 20 minutes long and buried deep within, several questions asked respondents about depression and anxiety. Those who answered provided a laggard but clearest snapshot into people’s mental state at the tail end of the lockdown, where many folks were subjected to isolationism, virus fears, and widespread unemployment.

That is the most alarming number that I have shared with you so far in this article, but I am about to share with you some numbers that are even more alarming.

In recent days, we have watched rioters destroy large sections of our major cities all across America.  But when asked about “violent protests”, a surprising percentage of Americans actually support them…

A broad majority of Americans say the peaceful protests happening all across the country after police violence against African Americans are justified (84% say so), and roughly a quarter (27%) say violent protests in response to police harming or killing African Americans are justified. Both figures are higher than they were when similar protests rose in the fall of 2016. Then, 67% saw peaceful protests as justified while 14% felt violent protests were.

There isn’t much of a racial or partisan difference over whether peaceful protests are justified now, but the gaps are larger over violent protests. Among Democrats, 42% consider violent protests justified in response to police violence against African Americans, while just 9% of Republicans agree.

Yes, you read that last sentence correctly.

42 percent.

Unfortunately, a lot more economic pain is on the way, and that is just going to fuel even more rioting, looting and violence.

These are definitely not “the best of times” no matter what stock market investors seem to think.

We have entered a deeply disturbing new chapter in American history, and life in this country will never be the same again.

About the Author: I am a voice crying out for change in a society that generally seems content to stay asleep. My name is Michael Snyder and I am the publisher of The Economic Collapse BlogEnd Of The American Dream and The Most Important News, and the articles that I publish on those sites are republished on dozens of other prominent websites all over the globe. I have written four books that are available on Amazon.com including The Beginning Of The EndGet Prepared Now, and Living A Life That Really Matters. (#CommissionsEarned) By purchasing those books you help to support my work. I always freely and happily allow others to republish my articles on their own websites, but due to government regulations I need those that republish my articles to include this “About the Author” section with each article. In order to comply with those government regulations, I need to tell you that the controversial opinions in this article are mine alone and do not necessarily reflect the views of the websites where my work is republished. The material contained in this article is for general information purposes only, and readers should consult licensed professionals before making any legal, business, financial or health decisions. Those responding to this article by making comments are solely responsible for their viewpoints, and those viewpoints do not necessarily represent the viewpoints of Michael Snyder or the operators of the websites where my work is republished. I encourage you to follow me on social media on Facebook and Twitter, and any way that you can share these articles with others is a great help.  During these very challenging times, people will need hope more than ever before, and it is our goal to share the gospel of Jesus Christ with all many people as we possibly can.

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