IHS-Markit released estimates for monthly GDP a couple days ago. Here’s the contours of the recovery so far — and it’s not a “V”.
Figure 1: Nonfarm payroll employment (dark blue), Bloomberg consensus for October as of 11/4 (light blue square), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink), all log normalized to 2020M02=0. NFP observation for October is based on Bloomberg consensus as of 10/30. Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (11/2 release), NBER, Bloomberg, and author’s calculations.
For me, the “V” ended with the July data, when nonfarm payroll employment and monthly GDP decelerated markedly. I doubt an acceleration, given the gridlock that is likely on fiscal policy; but full gridlock leaves open the possibility — albeit small — of retrenchment in September…
It’s why though Wolf Richtor warned against excessive stimulus. Since the 3% shift in suburban NAV’s occurred the last month of the election, you won’t have the Senate to get it.
I rarely say this, but “too few words”. Net asset values in suburbs? King James Bible in suburbs?
And a link would be nice.
Menzie,
I agree (and forecast it) that the V would end with a general deceleration, which is not yet visible in the quarterly level numbers, but certainly shows up in the numbers/figures you show, and has been visible for some time.
What I am wondering is your suggestion now of a “W,” which you did not spell out in discussion. That would suggest a return to recession. Based on what you show here it looks like industrial production might be starting to show that. Do you think that might spread to other parts of the economy and show up in GDP? Is this a matter that may depend on whether there is a further round of fiscal stimulus?
Non-technical thinking here – back to being the outhouse economist: My take is that a W is more likely than a reverse radical because the demand side of things will fall off again, if it hasn’t already. I’m standing corrected in my understanding that the average person isn’t a driver of demand like an average much wealthier than average person. However, there’s got to be a cumulative effect when the bulk of the population has a tough time with income. Plus, it looks like we are going to get hit by an even worse wave of Covid now. That’s going to have bad economic results as well.
As far as the election is concerned, the fat lady still hasn’t made a peep. Yogi Berra would be sitting on his hands.
One hope is that Moscow Mitch, with no election to worry about, will allow a lame duck vote on a stimulus package. Not holding my breath.
Moscow Mitch will sprawl across progress like the shell-less mollusk that he is. It is his nature.
I almost put these in Menzie’s most recent post, but then thought he might wish that to be a “politics free” or “neutral zone”. On this morning’s local news they said that Biden has pulled ahead of the orange abomination in the state of Georgia. So Biden has a decent chance of taking all of the electoral votes in Georgia, which by number (16) equal Michigan’s. This link I also thought was interesting, in addition to the NYT link had I had put up recently about Pennsylvania’s absentee votes, from NYT’s “Upshot” column:
https://www.predictit.org/markets/detail/5543/Which-party-will-win-Pennsylvania-in-the-2020-presidential-election
Looks like control of the Senate may come down to Georgia, here two run-off elections are likely to be needed. Good to see Biden eeking out a win here.
Normally, I’d expect disheartened Republican voters to stay home for the run-off. Nothing is normal this time. Democrats will need to work hard and avoid mistakes to pull out a 50/50 Senate split. Biden’s choice to avoid controversial declarations regarding the Supreme court and the filibuster rule may help in a run-off.
BTW, the addition of Georgia to my earlier electoral vote guess on Biden’s total electoral college count, would change that number from 290 to 306, which would put him 36 over the required 270 to become President-Elect, in addition to the inconsequential fact Biden also won the popular vote by millions.
306! Isn’t that the total Trump had in 2016? The irony!
UPDATE
From Benjamin Mueller of the New York Times:
“After Joseph R. Biden Jr. pulled narrowly ahead in Georgia on Friday morning, the focus shifted to Pennsylvania, whose 20 electoral votes could lift Mr. Biden decisively above the 270 he would need to become the next president.
By 7 a.m., with 95 percent of the state’s votes counted, President Trump led by roughly 18,000 votes. But tens of thousands of ballots were waiting to be counted, mostly from predominantly Democratic areas.
Among the biggest remaining batches of votes to be reported — roughly 54,000 — will come from Philadelphia, where the city commissioner, Al Schmidt, said in a televised interview early Friday that the count was continuing and updated vote totals would be released later in the morning.
Election workers briefly paused the counting in Philadelphia on Thursday because of litigation, Mr. Schmidt said. He added that election observers from both campaigns had been watching the count since Election Day, and that election workers had so far counted roughly 306,000 of the city’s 360,000 mail-in ballots.”
GOP is filing all sorts of court challenges – which likely will have no effect on the final result in Penn.
Not a music link:
https://www.youtube.com/watch?v=JV7mg0r1SRI
Heads up MENZIE!!!!!!! I found this rare treat by happenstance looking at the Michael Pettis link. Torsten Slok will be LIVE on Youtube Thursday (Nov. 5th) at 11:15 am central time:
https://www.youtube.com/watch?v=muO-YODcozA
November 4, 2020
Coronavirus
US
Cases ( 9,801,355)
Deaths ( 239,829)
India
Cases ( 8,363,412)
Deaths ( 124,354)
France
Cases ( 1,543,321)
Deaths ( 38,674)
UK
Cases ( 1,099,059)
Deaths ( 47,742)
Mexico
Cases ( 938,405)
Deaths ( 92,593)
Germany
Cases ( 597,359)
Deaths ( 11,028)
Canada
Cases ( 247,703)
Deaths ( 10,331)
China
Cases ( 86,087)
Deaths ( 4,634)
November 4, 2020
Coronavirus (Deaths per million)
US ( 723)
Mexico ( 716)
UK ( 702)
France ( 592)
Canada ( 273)
Germany ( 131)
India ( 90)
China ( 3)
Notice the ratios of deaths to coronavirus cases are 9.9%, 4.3% and 2.5% for Mexico, the United Kingdom and France respectively. These ratios are high, but have been significantly higher, while falling recently as new cases are being rapidly recorded.
November 4, 2020
Coronavirus (Deaths per million)
Belgium ( 1,045)
Spain ( 815)
US ( 723)
Mexico ( 716)
UK ( 702)
Italy ( 658)
Sweden ( 593)
France ( 592)
Netherlands ( 448)
Ireland ( 389)
Switzerland ( 294)
Canada ( 273)
Luxembourg ( 272)
Portugal ( 264)
Austria ( 136)
Germany ( 131)
Denmark ( 126)
India ( 90)
Greece ( 65)
Finland ( 65)
Norway ( 52)
Australia ( 35)
Japan ( 14)
Korea ( 9)
China ( 3)
What “return on his investment” did Joe Biden get for choosing “a Black woman” as his VP, who seemed to get some kind of extraordinary thrill out of incarcerating her own minority group, those without the income or resources to legally defend themselves, and chuckling about using Marijuana in college after having thrown away the jailhouse keys on Black men and Black women busted for using marijuana?? Along with claiming she was listening to “popular rapper X” when chronologically it made no sense at all she would have been listening to that rapper in the time frame she was attending university. I have said before, Black people aren’t dumb. They no longer vote for candidates just because they are Black. In fact, they may be deeply “turned off” by those they view as traitors that exist standing under their own tent. At least that is, standing under their same tent when they deem it useful to themselves.
https://news.yahoo.com/exit-poll-black-men-drifted-204522278.html
Where were those Black voters Copmala Harris was going to “appeal strongly to” on November 3rd?? Possibly hanging out with the multitude of female economics writers Barkley Junior extended an invitation to, to write at Econospeak blog???
Regarding minority males (because Hispanic males moved much more to Trump than did Black males), do please note that Kamala Harris is a woman. It has been noted that Trump’s strongman macho pitch does appeal to a certain segment of minority males, exactly those who would not be motivated by a female Black candidate.
i do not think kamala was chosen because she is black. biden wanted to choose a woman, and he felt she was the best woman for the position. the public already understood she was not embraced by the black community. but she is respected for her achievements by the female community, and most of the male community as well. SHE being the point, not skin color. she is infinitely more qualified than her sparring partner, pence.
@ baffling
I see…… well, that’s very “complimentary” to the other women that could have been chosen. Copmala Harris was the “best” one. Interesting theory. Is this best in the “Hillary was the ‘best’ SHE available” sense of the word “best”?? I know Hillary baked cookies in Arkansas and faked a southern accent after growing up in the midwest and getting a law degree from Yale, so that was loads of fun, so, if you’re relating that to Copmala’s fake love of rap albums that didn’t exist until years after she graduated from college…… that kinda seems “best” in that sense. Or does it make Copmala a “better person” to admit she liked artists who glamourize drug/marijuana use at the same time she was incarcerating users??
your comment is rambling with no coherent point. you seem to think kamala is not qualified. the upcoming president, and over 80 million other voters, seem to disagree with your point of view. if the other women were better, they would have been chosen. she was the best choice. that is how the selection process works.
And one more thing, Moses: are you aware of the fact that of the four candidates Trump, Pence, Biden, and Harris, she has by far the highest favorable ratings? You are just completely off the wall with your worthless and sick attacks on Harris. Grow up and get real, boy.
Actually, Moses, you are just dead wrong that Kamala Harris hurt the ticket among Blacks, even if a few percent of Black males went for Trump. The issue was Black turnout, which was down in 2016. Although we do not have the final numbers yet, it is clear that it was up strongly this year with over 90% supporting Biden-Harris. It has played an important role in key big cities: Miwaukee, Detroit, and Philadephia.
In Wisconsin alone it provided the key for flipping it back to Dems. The margin is close, only about 20,000 in favor of Biden-Harris, with the Trump winning it by about 16,000 in 2016. A rough estimate is that Black turnout in Wisconsin was up more than 10% this year from back then, which amounts to more than 30,000, more than enough to overcome the 16,000 deficit and make it positive and deliver the state.
In short, Mose, a pretty good investment in her, although Biden has been popular with Blacks anyway.
Where Biden messed up was paying so little attention to Latinos, which has cost a lot in several states, leading certainly to losses i some House seats, such as Donna Shalala in Florida, whom I knew when she was Chancellor at UW-Madison. His taking Latinos for granted is the one thingI have seen him pull in the campaign that bordered on what you have labeled him, Pelosi, and me, senile. But picking Harris was and continues to be an excellent choice that helped the ticket. You are just embarrassingly wrong on this one, yet another case of you getting all worked up about powerful women. Do you beat your girlfriend regularly, Mr. Self-Described Sadist?
shalala was an anomaly. she was popular in miami due to her leading the u. however, her popularity in the area was linked to her affiliation with a football institution, not her politics. she has no other links to the area and she is not latino. i was actually surprised that she ran for office the first time. it did not surprise me that she lost the second time. she simply does not fit into the mold of a south florida politician.
Bless Your Heart!
Here’s an interesting article, related to affordable housing, and it discusses a suburb near MIlwaukee:
https://www.nytimes.com/2020/11/05/us/affordable-housing-suburbs.html?action=click&module=Top%20Stories&pgtype=Homepage
https://cepr.net/preview-what-the-october-jobs-report-will-tell-us/
November 4, 2020
What the October Jobs Report Will Tell Us
By DEAN BAKER
There have been some anomalies in the data that are worth tracking.
With the period of rapid recovery from the shutdowns behind us, the labor market is likely looking at a long slog to get back to something resembling full employment. It clearly has lost considerable momentum now that the bulk of the CARES Act money has been spent. Furthermore, the economy will face serious headwinds, as the unchecked spread of the pandemic will lead to more measures curtailing business operations. It will also discourage people from visiting restaurants and using other services, even where there are no legal restrictions.
Job Growth Across Industries
The most immediate way to see how these effects are playing out is to see the mix of job growth across industries. Construction and manufacturing are likely to show healthy job growth. Residential construction is seeing a real boom due to low interest rates and the decision by many people to move out of major urban areas due to increased opportunities for remote work.
The surge in construction and home buying is also leading to high demand for many types of durable goods. People who have kept their jobs through the pandemic have money in the bank, and many are looking to make major purchases.
The picture with services, most obviously hotels and restaurants, looks very different. They are still far from having recovered the ground loss with the onset of the pandemic. It is entirely possible that we could see further job loss in these areas in response to the pandemic’s resurgence….
There were more than 100,000 new coronavirus cases yesterday in the US, there are 100,000 new cases today:
November 4, 2020
Coronavirus
US
Cases ( 9,801,355)
Deaths ( 239,829)
Serious, Critical Cases ( 18,045)
https://news.cgtn.com/news/2020-11-05/UAE-prime-minister-receives-China-developed-COVID-19-vaccine-shot-VaQSAHuH2o/index.html
November 5, 2020
UAE prime minister receives China-developed COVID-19 vaccine shot
The Prime Minister of the United Arab Emirates (UAE) Sheikh Mohammed Bin Rashid Al Maktoum said Tuesday he had received a COVID-19 vaccine.
Sheikh Mohammed, who’s also the vice president of UAE and the ruler of Dubai, shared the news on Twitter, posting a photo of him getting vaccinated by a medical staffer.
“While receiving the COVID-19 vaccine today. We wish everyone safety and great health, and we are proud of our teams who have worked relentlessly to make the vaccine available in the UAE. The future will always be better in the UAE,” he wrote in his post.
The vaccine he got was produced by the Chinese drug giant Sinopharm, according to a report from Qatari broadcaster Al Jazeera. It is nearing the end of Phase III trials in the UAE, Egypt, Bahrain and Jordan, which started in mid-July.
Sheikh Mohammed is the latest top Emirati official to be vaccinated against COVID-19.
Several ministers and senior officials have already received the vaccine in both the UAE and Bahrain, including UAE Foreign Minister Sheikh Abdullah bin Zayed Al-Nahyan and Deputy Prime Minister Sheikh Saif bin Zayed Al-Nahyan, as well as Bahrain’s crown prince.
In September, the UAE authorized the emergency use of Sinopharm’s COVID-19 vaccine on health workers, after the country’s health officials confirmed the positive results of the clinical trials….
Where is Brazil on this? Seems like China offered and then Bolsonaro thumped his chest and said “vaccines are for sissies”.
Today Donald Trump ended his presidency the same way he started it — by blatantly lying to the public about facts they can see with their own two eyes.
His first day in office, he lied about the size of his inauguration crowds. Today he claimed victory in the election based on just the “legal votes.”
Megapixel Stryker must be proud.
What is hilarious is watching all the sycophants in the Republican Party rapidly abandon him. “He’s a loser. Hardly knew the guy.”
With all due respect Joseph, which one of these Republicans are you referring to?? Can you name names of U.S. Representatives and U.S. Senators that are abandoning donald trump now?? FOX “News” is openly pouring gasoline over the militia fire. What fantasyland have you uncovered that I don’t see??
rick santorum, who i think ranks slightly below a pile of sh!t, threw trump under the bus.
don’t get me wrong, i will not give credit to a bunch of republicans who suddenly found god. but there is going to be a problem with a bunch of sore trump losers, and you can either be part of that crowd or stand up to it. and many republicans know that biden is taking down names. they no longer have trump to protect then from criminal behavior. trump may have a megaphone, but he will have no power to protect them from illegal behavior. some will go to jail.
@ baffling
WOW, Rick Santorum. Talk about a “power player” and “King maker”. How could I have forgotten that C-list name?!?!?!?! The Kathy Griffin of Republican politics. That lost endorsement will have donald trump reeling emotionally all of about 5 seconds. Rick Santorum~~the man that even TBN viewers find too boring. This is a crushing blow. I see now that your apprenticeship at The Barkley Junior Domestic Politics Vo-tech for Half-wits is now complete.
Moses, your comment makes no sense.
“His first day in office, he lied about the size of his inauguration crowds.”
Obama commented on how Trump is fixated with crowd sizes. He must have been traumatized as a child when no one attended his birthday party. BAHAHAHA!
Yesterday 108,000 new coronavirus cases in the country and today 116,000 new cases, but the current president offers no thoughts on the matter. Branko Milanovic calls this a Hobbesian state of affairs and I would agree.
That turns out to be 118,000 new coronavirus cases today, after all the counting ends. What sadness.
November 5, 2020
Coronavirus
US
Cases ( 9,919,522)
Deaths ( 240,953)
India
Cases ( 8,411,034)
Deaths ( 125,029)
France
Cases ( 1,601,367)
Deaths ( 39,037)
UK
Cases ( 1,123,197)
Deaths ( 48,120)
Mexico
Cases ( 943,630)
Deaths ( 93,228)
Germany
Cases ( 619,116)
Deaths ( 11,190)
Canada
Cases ( 251,338)
Deaths ( 10,381)
China
Cases ( 86,115)
Deaths ( 4,634)
November 5, 2020
Coronavirus (Deaths per million)
US ( 726)
Mexico ( 720)
UK ( 708)
France ( 598)
Canada ( 274)
Germany ( 133)
India ( 90)
China ( 3)
https://news.cgtn.com/news/2020-11-06/Chinese-mainland-reports-36-new-COVID-19-cases-30-from-abroad-VbO0kEIQ3m/index.html
November 6, 2020
Chinese mainland reports 36 new COVID-19 cases, 30 from abroad
The Chinese mainland registered 36 new confirmed COVID-19 cases on Thursday, 6 of which are local transmissions in northwest China’s Xinjiang Uygur Autonomous Region and 30 from overseas, the National Health Commission announced.
A total of 33 new asymptomatic COVID-19 cases were recorded, while 832 asymptomatic patients remain under medical observation. No COVID-19-related deaths were reported on Thursday, and 17 patients were discharged from hospitals after recovering.
As of Thursday, the total number of confirmed COVID-19 cases had reached 86,151, with 4,634 fatalities.
Chinese mainland new imported cases
https://news.cgtn.com/news/2020-11-06/Chinese-mainland-reports-36-new-COVID-19-cases-30-from-abroad-VbO0kEIQ3m/img/e2bdf77b939e4a4382d3111f953ecc18/e2bdf77b939e4a4382d3111f953ecc18.jpeg
Chinese mainland new asymptomatic cases
https://news.cgtn.com/news/2020-11-06/Chinese-mainland-reports-36-new-COVID-19-cases-30-from-abroad-VbO0kEIQ3m/img/ef1062ea87424c1ba4b76c8a6b88ca3e/ef1062ea87424c1ba4b76c8a6b88ca3e.jpeg
[ There has been no coronavirus death on the Chinese mainland since May 17. Since June began there have been 4 limited community clusters of infections, in Beijing, Dalian, Urumqi and Qingdao, each of which was contained with mass testing, contact tracing and quarantine, with each outbreak ending in a few weeks.
Currently there is an apparently limited community cluster in Kashgar, with mass testing, contact tracing and quarantine again being used to identify the origins of as well as to contain and end the outbreak.
Imported coronavirus cases are caught at entry points with required testing and immediate quarantine. Asymptomatic cases are all quarantined. The flow of imported cases to China is low, but has been persistent.
There are now 419 active coronavirus cases in all on the Chinese mainland, 9 of which cases are classed as serious or critical. ]
Biden is now leading by over 5,000 votes in Pennsylvania, and some votes are still left to be counted.
https://www.youtube.com/watch?v=-0S8D24S57k
About Brazil, American policy in Latin America is actively based on trying to remove any Chinese involvement through the region. This means stopping Latin-Chinese coronavirus testing. Chinese vaccine testing has been on-going in Brazil and the governor of Sao Paulo has already ordered enough Chinese vaccine doses for the entire province. However, a few days ago, the president of Brazil announced that there would be no use of a Chinese vaccine in the country. Regional officials in Brazil responded that there would be use of a Chinese vaccine and the Brazilian president simply dropped the matter.
Thanks. Hope it works. Brazil surely needs a break.
A pretty decent employment report:
https://www.bls.gov/news.release/empsit.nr0.htm
The drop in the unemployment rate is from a sizeable increase in the employment to population rate as the labor force participation rate increased.
Oh well – too late for Trump’s votes. Unless he changes his mind when ballots can be received!
CBS’ Major Garrett just made a super shrewd and perceptive comment on TV. I am going to attempt to paraphrase what Major Garret said but am afraid I will not do his statement the true justice it deserves. He said that many people have described protests around this nation (obviously referring to civil rights protests and protests against police violence) as “unruly” “rowdy” and “mob rule”. He made the extra effort to delineate that that was not his personal way to label it, but Garrett rhetorically asked what were the people who were surrounding vote counters with guns an vulgarity in Maricopa County to be described as??? I have watched a decent amount of TV commentary the last 48+ hours, small portions of it excellent. I thought Major Garrett’s comments (this particular one anyway) to be the most insightful and “dead on target” that I have heard thus far.
Kevin Drum on the BLS report:
https://www.motherjones.com/kevin-drum/2020/11/chart-of-the-day-net-new-jobs-in-october-4/
‘The American economy gained 638,000 jobs last month and the unemployment rate declined to 6.9 percent. It’s good news that job creation is still positive, but it’s bad news that the rate of job creation seems to have flattened out long before we’ve made up the losses of March and April:
There was other bad news too: Once again, government employment fell. In October there were 268,000 fewer government workers than in September, which means that total job creation was less than 400,000.’
Why are we cutting government jobs now? Oh yea – Trump is still in charge.
It looks like Trump is going to lose Georgia by around 1,000 votes. The bitter irony is that Trump’s ineptitude in the pandemic killed 8,500 moistly elderly, mostly Trump voters in the state before they could vote.
Georgia will likely have a recount. Trump is making the claim that the Republicans running the vote (very professionally) have decided not to count the military vote. Of course the Georgia officials have already noted that they are counting the military vote.
Trump has gone truly insane over the prospects that Biden has won this.
joseph, trump took the view that dead people don’t vote. by his calculation, he got more support by keeping the economy open than letting a few thousand people die. from a votes perspective, that is probably correct. from a humanity perspective, well, he has none.
Right now Biden leads in Georgia by 4000!
UPDATE: 7,248 vote lead for Biden in Georgia. And as a side note, the man who has pooh-poohed the Covid-19 virus since last summer now has been infected with Covid-19:
https://www.bbc.com/news/world-us-canada-54851759
Let’s hope Meadows’ immune system is stronger than Herman Cain’s, because it appears his brain power is roughly the same to Herman’s.
Latin American countries have recorded 4 of the 10 and 6 of the 16 highest number of coronavirus cases among all countries. Brazil, Argentina, Colombia, Mexico, Peru and Chile. Mexico has the fourth highest number of cases among Latin American countries and the tenth highest number of cases among all countries.
November 5, 2020
Coronavirus (Deaths per million)
US ( 726) *
Brazil ( 759)
Argentina ( 723)
Colombia ( 631)
Mexico ( 720)
Peru ( 1,048)
Chile ( 751)
Ecuador ( 718)
Bolivia ( 747)
* Descending number of cases
Trump has put David Bossie in charge of stopping votes from being counted:
https://www.mediamatters.org/fox-friends/fox-friends-lets-david-bossie-push-nonsense-voter-fraud-claims-defend-early-claim
Fox & Friends lets David Bossie push nonsense voter fraud claims to defend premature claim of Trump election victory
Ten million coronavirus cases in the US, the Hobbesian state of affairs of Branko Milanovic.
http://www.xinhuanet.com/english/2020-11/05/c_139493620.htm
November 5, 2020
China’s centralized purchasing leads to 90 pct drop in price of coronary stents
TIANJIN — Coronary stents, once priced at more than 10,000 yuan (about 1,500 U.S. dollars) each, are expected to become available in Chinese hospitals at roughly 1,000 yuan for the treatment of coronary heart disease.
That estimate comes from the results of the initial round of the Chinese government’s centralized procurement program for high-value medical commodities, which were unveiled on Thursday in north China’s Tianjin City.
The 10 varieties of coronary stents that were successful following bidding saw their average price down to around 700 yuan from about 13,000 yuan, according to the office in charge of the program.
They cover mainstream products now commonly used in health institutions, with quantities accounting for more than 70 percent of the intended purchase volumes of these institutions.
The average price for the same products from the same enterprises has decreased by 93 percent from 2019. The average price reduction for domestically made products is 92 percent, and it is 95 percent for imported products.
It is estimated that the price cut due to centralized purchasing will save patients some 10.9 billion yuan in related expenses.