What Will Not Change - Mauldin Economics

What Will Not Change - Mauldin Economics

...With remote medicine, you can look more widely and are far more likely to find someone with exactly the expertise you need. This should improve healthcare even if technology stays the same, which it won’t. It will get better, too. All because a pandemic upended the established order.

I think we may be on the cusp of a sweeping change in human organization. Instead of clustering together in giant concrete boxes so we can be close to the people we think we should know, we will cluster virtually, with exactly the people we need to know. Teams that need expertise will be able to access it wherever it is. Severing this tie between “where we work” and “where we live” could have profound consequences.

Cornell Chalks Up Rare Covid-19 Containment Victory - Bloomberg

Cornell Chalks Up Rare Covid-19 Containment Victory - Bloomberg

Cornell Chalks Up Rare Covid-19 Containment Victory

The Ivy League university quelled an early outbreak and kept transmission low with frequent testing and intensive contact tracing.

 

By Emma Court

October 28, 2020, 11:00 AM GMT

 

When Cornell University reopened its sprawling Ithaca, New York campus to a population of about 24,000 people in late August, more than a few students, parents, faculty and local residents saw a disaster in the making.

 

After all, no other Ivy League school was attempting to bring back its entire student body all at once.

 

Rachel Geltman, a senior whose father died from the virus this spring, and her mother, Elizabeth Geltman, a public-health professor and Cornell alumna herself, were among those with serious doubts. Rachel worried that the university was setting its students up to fail, while her mother recalled the university’s long tradition of rowdy Greek houses and cramped on-campus dormitories that she calls “stationary cruise ships.”

 

And, sure enough, a cluster of cases emerged just days before classes were to begin. People living in Ithaca and surrounding towns were just “waiting for the other shoe to drop,” county legislator Anna Kelles said.

 

Eight weeks into the fall semester they are still waiting. After quelling the early outbreak, new cases have remained so low that Cornell’s test-positivity rate of 0.006% one recent week was one of the lowest of any college or university in the country performing large-scale testing, Provost Michael Kotlikoff said. With only 149 virus cases total through late October, reality outperformed even the school’s most optimistic modeling. This comes even as Covid-19 has roared back in communities across the country, including many with college campuses.

 

As the university hatches plans for another in-person semester this spring, and with even more students expected to return, administrators say their experience shows that by now well-understood public-health measures work, even amid a failure of U.S. policy to implement them broadly. With a month left to Thanksgiving break, when students will go home until in-person classes resume in February, there’s also a realization that perils remain: Cold weather is approaching, and cases in surrounding communities are on the rise.

 

“We are in good shape right now, but there are threats. This is a fragile victory,” said Kotlikoff. “People are getting tired and they’re tired of being in their rooms. And it’s something everyone’s putting up with.”

 

When Cornell first announced in late June its decision to bring students back, it said thousands would return to private housing whether school facilities were open or not. In Ithaca, real estate is tight in a coveted, dense stretch of off-campus apartments known as Collegetown, and students often sign expensive leases as much as a year in advance.

 

Without the campus as a resource, Cornell would have had less oversight over students and less ability to test them, resulting in about six times more cases, its modeling concluded.

 

Since classes began in early September, regular testing as often as twice a week has proven instrumental. The tests are performed in a new lab set up in Cornell’s renowned veterinary college, under the purview of Kotlikoff, a former vet school dean. He’s well-acquainted with PCR testing, the gold-standard for detecting Covid-19 and which he used for decades to root out viral outbreaks in mouse colonies maintained for scientific research.

 

As it tests about 35,000 students, faculty and staff a week, the Cornell lab -- like those at other educational institutions -- has relied on an emerging technology known as pooling to process five samples at once, with hopes of eventually getting to 24 at a time. That lowered the cost to $12 a test, and let the lab save chemicals called reagents that are in short supply nationwide. Testing and several other virus measures are expected to cost Cornell about $10 million for the semester.

 

Bringing students back in person has also been a major financial draw for colleges and universities, which have had to refund millions in room and board charges after students were sent home during the spring term. A drop in enrollments this fall has further squeezed their budgets. Cornell instituted a hiring freeze and spending and salary cuts, including for Kotlikoff.

 

“The alternative was for us to have an online semester, a less than valuable experience for our students, a campus that wasn’t occupied in terms of our dorms and dining services,” he said. “It would require layoffs of individuals that we didn’t want to do.”

 

The school also credits a new approach it calls “adaptive” testing, which casts a wider net for potential infections than traditional contact tracing. Instead of looking for individuals who were within six feet of a confirmed Covid-19 case for 10 minutes or more, as New York state contact tracing does, adaptive testing also screens people who don’t meet that definition but share a bathroom with a positive case or are on the same athletic team.

 

Cornell administrators concede they went into the fall semester with certain advantages not shared by all other institutions. These include a remote location in Ithaca and robust financial and scientific resources. In addition to the vet school for testing, it has an on-campus hotel, the Statler, used for isolation and quarantine, said Peter Frazier, an associate professor who led the modeling for Cornell’s reopening. Those and other factors may limit how broadly Cornell’s safeguards may work in other settings.  

 

One major, if unsurprising, takeaway from Cornell’s limited infections: The biggest risk is in social networks and get-togethers. Cases have also been imported when students have traveled outside of campus. But the university has seen no transmission in the classroom, though infected students have attended classes, or in dorms, which are about 70% occupied, according to Kotlikoff.

 

That early cluster, it turned out, emerged from college athletes getting together without masks and failing to socially distance, prompting a public rebuke from the school. That was “a real warning shot” and the school hasn’t seen virus spread like it since, Kotlikoff said.

 

Geltman, the public-health professor and Cornell mom, has been impressed by the virus measures Cornell has taken. But she said that more work is needed to understand why the university has been so successful, including antibody tests to understand how much protection to the virus exists in its population.

 

“Are they lucky? Yes, to some extent they are,” she said. “Because it takes a small group of idiots to create a big problem.”

 

Editor’s Note: Emma Court is a graduate of Cornell University

 

Coronavirus on Frozen Food Imports Is Real Concern, Expert Says - Bloomberg

Coronavirus on Frozen Food Imports Is Real Concern, Expert Says - Bloomberg

Concerns About Virus on Food Imports Are Real, Expert Says

Bloomberg News

October 29, 2020, 12:47 AM GMT Updated on October 29, 2020, 2:14 AM GMT

 

There is a real risk of cross-border coronavirus transmission through the $1.5 trillion global agri-food market, according to a scientist who has studied the phenomenon.

 

It is possible that contaminated food imports can transfer the virus to workers as well as the environment, said Dale Fisher, an infectious diseases physician at Singapore’s National University Hospital. Frozen-food markets are thought to be one harbor in the first part of a chain of transmission, he added.

 

“It’s hitching a ride on the food, infecting the first person that opens the box,” Fisher, who also chairs the Global Outbreak Alert and Response Network, said in an interview. “It’s not to be confused with supermarket shelves getting infected. It’s really at the marketplace, before there’s been a lot of dilution.”

 

In recent months China has been vocal about finding traces of the SARS-CoV-2 pathogen on packaging and food, raising fears that imported items are linked to recent virus resurgences. Beijing has ordered a range of precautionary steps, creating major disruptions with its trading partners.

 

While such transmission remains a “freakish” event, the scale of the global food trade is such that it will occur a few times out of millions of imports and exports, said Fisher.

 

‘Two Schools’

It’s a theory that has been downplayed by the World Health Organization and some western nations. The WHO has said recent evidence of epidemiology shows that it’s “unlikely” that the virus could be transmitted from the surfaces to human respiratory systems, while the U.S. Food and Drug Administration has also stated it isn’t aware of any evidence to suggest the disease can spread through food.

 

Outside China, where authorities are increasingly weighing in the possibility that the virus can be carried and transmitted via food packaging, the theory is barely mentioned or discussed. Fisher is one of the few international experts who studies the seeding of outbreaks in contaminated fresh and frozen food.

 

“There’s two schools of thought and the minority view which I adhere to is that there’s a lot of circumstantial evidence,” Fisher said. “A lot of people may be against this because they don’t want to scare the world -- the food could be a source.”

 

 

Experiments done by Fisher’s team show the coronavirus could survive in the time and temperatures associated with transportation and storage conditions used in the international food trade. The study published in August showed no weakening of the infectious virus after 21 days at standard food refrigeration and freezing temperatures when the pathogen was added to samples of chicken, salmon and pork.

 

The fact that the virus tends to thrive in cold and dry environments has made cold-storage facilities ideal spaces for the pathogen to spread. Meatpacking plants and abattoirs, instead of schools and churches, are more likely to be hot spots for Covid-19 outbreaks, according to Fisher.

 

“It’s because there’s a lot of stainless steel, which it grows on,” he said. “It’s cold, it’s crowded -- it’s noisy so the people have to yell.”

 

China Scares

Earlier this month, authorities in the eastern Chinese coastal city of Qingdao said they found live SARS-CoV-2 on imported frozen seafood, with two port workers responsible for unloading the refrigerated packaging testing positive for the virus.

 

China has said several times in recent months that imported refrigerated goods are risks for re-introducing the coronavirus into the country. It subsequently banned imported products, including seafood from Indonesia and chicken wings from Brazil, following positive tests on shipping containers and food packaging.

 

A June outbreak in Beijing triggered a nationwide boycott of salmon when the virus was traced to the chopping board of a seller of imported fish. New Zealand, which has maintained long virus-free stretches, also said it was looking at the chance that one of its new clusters could be linked to a cold-storage plant.

 

Fisher argued the reason Asian countries are more likely to find evidence of food and packaging transmission is thanks to the now contained nature of outbreaks in many of those countries, unlike those in the west now battling a second wave of infections.

 

“You’d never pick it up in the U.S. or in Europe, because you only pick it up if you go from zero cases for 100 days, and then have a small cluster,” he said. “You say, well how did this small cluster start?”

 

To prevent this, food production companies need to ensure workers are vigilant on mask-wearing, hand-washing and regular sanitization of surfaces and utensils.

 

“And you need to make sure that all these outbreaks in meat processing plants stop,” he said.

 

— With assistance by Philip Heijmans, and Claire Che

 

How Trump Sealed the GOP’s Suicide - The Bulwark

How Trump Sealed the GOP’s Suicide - The Bulwark

...By 2012, the GOP had come to rely on a partially overlapping base of evangelicals; whites without college degrees threatened by economic dislocation; and malcontents whose distrust of government partook of paranoia. These folks were not natural allies of the party of business or its wealthy donors. In exchange for pursuing the economic agenda of the wealthy, the GOP increasingly offered up a primal vision rooted in culture wars, contempt for government, and scapegoating blacks, immigrants, Muslims and other minorities.

The real causes of blue-collar woes were globalization, the Great Recession, the housing crisis, and an information society which marginalized the undereducated. About this, the GOP elite did nothing—not about student debt, stagnant wages, dwindling benefits, diminishing job security, retraining for the new economy, or the widespread unaffordability of quality medical care. The epitome of their nihilism was Ted Cruz: a grandstanding opportunist who tried to shut down the government while assembling a stunted coalition of evangelicals, gun fanatics, nativists, climate-change deniers, and Tea Party atavists.

...The GOP had been “continually marginalizing itself,”

Time to Reset Expectations for World Economy With Virus Untamed - Bloomberg

Time to Reset Expectations for World Economy With Virus Untamed - Bloomberg

Time to Reset Expectations for World Economy With Virus Untamed

By Enda Curran, Suzi Ring, and Anchalee Worrachate

October 25, 2020, 5:00 AM GMT

 

Investors banking on a coronavirus vaccine to save the world economy in 2021 need to temper their ambitions as scientists increasingly warn of a long and difficult road ahead.

 

While drug companies are making progress in the quest to find a cure for a disease that triggered the worst recession since the Great Depression, questions remain about how effective the first wave of vaccines would be, how easy they will be to distribute to more than 7 billion people and then how many will agree to take them.

 

The future for global growth relies on the answers to those questions as a new wave of the pandemic means health fears and government restrictions continue to inhibit daily life and commerce. Even when a successful immunization system does come along, it won’t be an instant economic panacea, says Chris Chapman, a portfolio manager at Manulife Investment, which manages more than $660 billion.

 

“In terms of actually getting back to pre-Covid or trend growth, it could take more than a year,” said Chapman. “The timing of the recovery will be delayed, but there is still expectation of a vaccine at some point next year.”

 

For decades, the world economy relied on central bankers and finance ministers to pull it out of crisis, on the basis that if you pump the right amount of money into an economy, a recovery will eventually follow.

 

This time is different, as investors look to scientists and data from vaccine and treatment trials for signs of hope just as much as they pore over stimulus plans coming out of Washington, Beijing or European capitals. The longer the hunt for an effective vaccine lasts, the weaker economic expansions will be.

 

To be sure, science could yet make major breakthroughs in the near term. If even only a small proportion of the population such as healthcare workers and the most vulnerable are immunized, that could make a big difference to the resumption of everyday life. Savings built up by households and businesses in 2020 could be unleashed in 2021.

 

Pfizer Inc. said this month it could seek emergency-use authorization in the U.S. by late November for its vaccine with German partner BioNTech SE. Moderna, another frontrunner in the race, is also looking at the possibility of an emergency approval this year if it has positive interim results next month.

 

Balancing Act

“There is a fair prospect that by the late spring, vaccines will be available in quantities sufficient to protect the most vulnerable groups,” said Neil Ferguson, an epidemiologist at Imperial College London, and former Covid-19 adviser to the U.K. government. “But at least until then, life will unfortunately remain a balancing act between reopening society and keeping the virus in check.”

 

Scientific hiccups may slow things down too. Johnson & Johnson paused clinical trials of its Covid-19 shot this month after a participant fell ill, weeks after AstraZeneca Plc and the University of Oxford stopped studies for the same reason. On Friday, both companies announced plans to resume their U.S. trials.

 

Effective treatments that would also help the economic recovery are also a mixed picture. Disappointing trial results this month for the much-hailed drug remdesivir from Gilead Sciences Inc. showed the antiviral treatment doesn’t save the lives of Covid-19 patients, despite U.S. President Donald Trump extolling its benefits. Still, U.S. regulators cleared the drug for use this week and Gilead has challenged the recent findings citing other positive results.

 

While there are hopeful signs from some antibody treatments being tested, the steroid dexamethasone is one of the only other therapeutics showing a meaningful benefit, and is aimed at people with very severe symptoms.

 

Even if an effective vaccine is discovered, the logistics of distribution will still mean disruption to work, travel and leisure will remain, with only a small subset of the population expected to receive a shot in the first instance anyway.

 

That all spells trouble for global growth, even as data in the U.S. and euro-area are likely to show this week that it rebounded smartly in the third quarter and didn’t collapse as much as once feared.

 

Long gone though is talk of a V-shaped recovery, as winter nears in the northern hemisphere -- and with it the risk the virus spreads more easily. Bloomberg Economics’s gauges of high-frequency data already point to a weakening of activity in many industrial nations in October, particularly those in Europe.

 

‘Very Precarious’

“The virus is creating a major element of uncertainty,” former Federal Reserve Chairman Alan Greenspan told Bloomberg Television last week. “Forecasting it is very precarious.”

 

Underscoring the pressure for an end to the pandemic is the knowledge economic scars are already forming. Among them: lost jobs, record debts, corporate bankruptcies, atrophying skills, missed investment, deglobalization, frayed mental health and rising inequality.

 

A recent study declared the U.S. economy alone will witness “large, persistent adverse effects” in the long term that outweigh the short-term hit in part because the virus means greater unease among the public.

 

“This did not start as a financial crisis but it is morphing into a major economic crisis, with very serious financial consequences,” World Bank Chief Economist Carmen Reinhart told Bloomberg Television. “There’s a long road ahead.”

 

Even in those parts of the world where the virus has been largely contained, consumers remain cautious. Chinese retail sales have only just begun to accelerate even though the most severe limits on movement were lifted months ago.

 

There is also the question of re-infection. Scientists have found it’s possible to get Covid-19 more than once, with a handful of confirmed cases globally. That presents another obstacle, which a vaccine may only partially solve.

 

There’s a high chance the coronavirus, like flu, could require regular shots to keep it at bay, meaning the virus could cast an even longer arc than already expected, cautioned Graham Medley, a professor of infectious disease modeling at the London School of Hygiene & Tropical Medicine, and member of the U.K. government’s Covid-19 advisory panel.

 

“If second and third infections are as infectious as the first infection, and the first generation of vaccines is not very efficacious, then it’s possible that Covid-19 will continue to be a major aspect of life into 2022,” he said.

 

Covid-19 Reinfections Are Real, Should You Be Worried? - Bloomberg

Covid-19 Reinfections Are Real, Should You Be Worried? - Bloomberg

The Legal Threats Trump Will Face If He Loses the Election

The Legal Threats Trump Will Face If He Loses the Election

United States v. TrumpThe Big Legal Threats Trump Will Face If He Loses the Election

By David Yaffe-Bellany

October 23, 2020

 

President Trump has more at stake in this election than whether he remains in the White House. Holding the highest office in the land grants him effective immunity from federal criminal prosecution and gives him wide powers to stymie lawsuits against him and his business. That all changes once he becomes an ordinary citizen again.

 

“Whatever shelters he has had as an occupant of the White House would vanish,” says Laurence Tribe, a constitutional law professor at Harvard and frequent Trump critic. “His ability to throw his weight around in terms of the deference that judges exercise—all of that is gone.”

 

A federal prosecution of Trump would be political dynamite, and a President Joe Biden may choose not to detonate it. But a new administration could decide to revive Special Counsel Robert Mueller’s investigation into obstruction of justice by Trump or launch a new probe into the questionable tax deductions the New York Times revealed in a recent investigative report. Trump is also facing an active investigation by the Manhattan district attorney that could result in state criminal charges.

 

Then there are the lawsuits. Famously litigious before he took office, Trump has used the powers of the presidency to swat aside many of the cases brought against him, often deploying the Justice Department to do so. Even now, the government is trying to intervene in a defamation suit brought by a woman he called a liar after she accused him of rape.

 

The White House didn’t comment on the legal threats facing Trump. His personal lawyer Jay Sekulow didn’t respond to requests for comment. Alan Garten, a lawyer for the Trump Organization, also didn’t respond to a request for comment.

 

Here are the major legal threats facing Trump, and how a defeat in November would affect them:

 

Possible Criminal Charges

Obstruction of Justice

Where things stand

The Mueller report detailed numerous episodes in which Trump may have obstructed justice, including his suggestion that former FBI director James Comey drop an investigation of Michael Flynn, his short-lived national security advisor, his subsequent firing of Comey, his efforts to fire the special counsel himself, and his many public comments exhorting witnesses not to cooperate. But the Mueller team stopped short of recommending criminal charges, citing in its report the Justice Department’s official position that a sitting president cannot be indicted. Trump has denied obstructing justice, calling the whole Mueller investigation a “hoax.”

 

If Trump loses

The prohibition against indicting the president would no longer apply, and a Biden Justice Department would theoretically be free to revive the obstruction investigation and bring charges against Trump. But prosecuting a former president would cause a political uproar. Trump has also suggested he could pardon himself, an act that would likely result in years of additional litigation. Even if federal prosecutors decided to proceed, they would face practical hurdles. Andrew Weissmann, one of the lead prosecutors on Mueller’s team, says the probe’s final report laid out “sufficient proof” that Trump obstructed justice. But he acknowledges a new attorney general would likely want more. “You could imagine someone saying: ‘Is there more grand jury work to do? Do we want to lock people in so that we know exactly what they would say, and we’d know what we’d go to a jury with?’”

 

Campaign Finance Violations

Where things stand

Trump’s longtime personal lawyer and fixer Michael Cohen was sentenced to more than three years in prison in 2018 after pleading guilty to campaign finance violations. He made hush-money payments just before the 2016 election to adult-film actress Stormy Daniels, who claims she had a sexual affair with Trump. Cohen said Trump, identified in case filings as “Individual 1,” directed the payments, which prosecutors said constituted an illegal campaign contribution. National Enquirer publisher American Media Inc. and David Pecker, its chairman at the time, also admitted working with Cohen and the Trump campaign to kill damaging stories about the candidate, entering into a non-prosecution agreement with the government in 2018. Trump wasn't charged, and he's denied violating any campaign finance laws.

 

If Trump loses

Although federal prosecutors never explained why they didn’t charge Trump with the same crime as Cohen, it’s likely the Justice Department’s policy against prosecuting a sitting president was a factor. That obstacle would be removed under a President Biden, but the same political considerations that complicate an obstruction-of-justice case would apply. Harry Sandick, a former federal prosecutor in New York, says the government would also have to take a hard look at the witnesses on whom it would be relying. “If you were the government, would you consider Michael Cohen to be a sufficiently credible witness to build a case around?” Sandick asks. “That’s always been a concern.”

 

Federal Tax Charges

Where things stand

The New York Times on Sept. 27 blew the lid off one of Trump’s most fiercely guarded secrets: his taxes. In a lengthy investigative report based on two decades of tax data, the newspaper revealed that Trump claimed staggering losses that allowed him to pay only $750 in income taxes in 2016 and that the audit he’s long acknowledged relates to a $73 million tax refund he claimed. Several of the president’s deductions raised eyebrows among tax experts, who said they could form the basis of a tax fraud prosecution. These include a $70,000 deduction for Trump’s hairstyling while he was on The Apprentice and write-offs of some $26 million in vague “consulting fees,” nearly $750,000 of which appears to have gone to Trump’s daughter Ivanka while she was a full-time executive of his company. Trump has called the Times report “fake news” but has also accused the newspaper of illegally obtaining his tax records.

 

If Trump loses

Any criminal charges based on the president’s taxes would depend on whether prosecutors could show that he deliberately set out to defraud the government. That would be tough to prove. “They’d need to have memos in the files or email showing that,” says former Internal Revenue Service auditor Michael Sullivan. “The reality is I don’t know if you can show that.” Even if he doesn’t face criminal charges, Trump could be sued by the IRS over any taxes it believes he owes. But Mark Cook, a partner at the accounting firm SingerLewak, says he thinks the $70,000 hairstyling deduction is probably too small to interest the agency.

 

New York State Tax Charges

Where things stand

Trump fought Manhattan District Attorney Cyrus Vance’s grand jury subpoena seeking eight years of his taxes and financial records all the way to the Supreme Court, which in July rejected Trump’s claim of absolute immunity from state criminal investigations. Trump has continued to fight the subpoenas on other grounds, but now the spotlight is shifting to what Vance is actually investigating. At first, the district attorney said he was examining whether Trump’s company tried to conceal the Stormy Daniels payment, but his office recently suggested it was conducting a broader probe of possible bank or tax fraud.

 

If Trump loses

This investigation would likely gain momentum, with Vance finding it easier to obtain crucial documents from third parties and arrange depositions of people in Trump’s orbit, or even the president himself. “My guess is there’d be more information than they could possibly handle,” says John Moscow, a former senior prosecutor in the DA’s office. Would that result in a prosecution? Trump’s pardon power doesn’t apply to state cases, and Vance, who’s running for reelection next year in a county where Trump barely won 10% of the vote in 2016, may have different political calculations than a Biden Justice Department. But many people have a hard time envisioning it happening. Moscow points out that seating an impartial jury could be tough. “If you find a juror who has never heard of Donald Trump, that’s probably not a great juror,” he says.

 

Trump Inc.

Real-Estate Fraud

Where things stand

New York Attorney General Letitia James is investigating whether the Trump family’s real-estate company falsely reported property values to secure loans or tax benefits. Her office this month deposed Trump’s son Eric, an executive vice president at the Trump Organization. Right now it’s a civil matter, meaning any penalties would be mainly economic. But that could change if James thinks there is evidence of criminal misconduct. Eric Trump has called the investigation politically motivated and said it represents “the highest level of prosecutorial misconduct.”

 

If Trump loses

Trump has long been able to argue that he’s too busy as president to deal with lawsuits, and courts have generally given him broad deference as head of the federal government’s executive branch. He would not get that deference as a former president and could be forced to sit for a deposition. Like Vance, James would probably find it easier to get information or cooperation from others. “The hesitation on the part of third parties who are the holders of potentially very incriminating information will evaporate once he’s no longer president,” Tribe says.

 

The Emoluments Cases

Where things stand

Allegations that Trump uses the presidency for personal profit have been among the most consistent criticisms leveled at him during his time in office. Congressional Democrats and Democratic attorneys general brought two lawsuits accusing Trump of violating the U.S. Constitution’s so-called Emoluments Clause, which bars the president from receiving gifts or things of value from foreign governments, by accepting the money that representatives of Saudi Arabia and other countries have spent at his company’s Washington hotel, in particular. A third emoluments case was brought by a watchdog group. The Trump administration has mainly challenged the rights of the parties to bring emoluments claims, winning dismissal of the congressional suit. No court has ruled on the issue of whether the president has in fact violated the clause. Trump has called the Emoluments Clause “phony” and suggested other presidents made money on the side.

 

If Trump loses

Trump will probably not have to worry about these cases. The goal of the suits was to force him to fully divest himself from his businesses while in office. But that will no longer be a relevant concern if Trump loses in November, and violations of the emoluments clauses do not carry any other financial penalties. “There’s no longer any remedy that could be issued,” Tribe says. “It’s unfortunate but likely that the emoluments cases will be dismissed.”

 

Congressional Tax and Financial Records Cases

Where things stand

Democrats in Congress are fighting in court to win access to Trump’s financial records. In one lawsuit, the House Ways and Means Committee is calling for the Treasury Department to turn over the president’s tax returns. That case is pending in federal court in Washington. Two other lawsuits involve Trump’s accountants and bankers. In those cases, the Supreme Court ruled that Congress could not compel the release of Trump’s financial records, at least for the time being. The cases were sent back to the lower courts to assess whether Congress should narrow the scope of the information it sought. In all three cases, Trump has invoked the powers of the presidency to argue that he should not have to turn over his financial information.

 

If Trump loses

Before Trump took office, it was widely accepted that congressional tax committees could request any taxpayer’s returns, including the president’s. But Trump' Treasury Secretary, Steve Mnuchin, defied the House Ways and Means Committee, and the administration has continued the fight in court. A Biden administration could put an end to that drama by quickly handing over Trump’s taxes to Congress. How courts would rule on the Democrats’ requests for Trump’s other financial records, which were sent to his bankers and accountants, is harder to predict, though Trump would lose his argument that the litigation interferes with his duties as president. “I don’t know who’s going to win,” said Andy Grewal, an expert on tax law at the University of Iowa. “But it would be odd if Congress could threaten a president by saying the moment you leave office we can subpoena you for anything you have.”

 

Multi-Level Marketing Fraud Suit

Where things stand

Trump and three of his children were sued for fraud in 2018 over their endorsement on Celebrity Apprentice of ACN Opportunity LLC, a troubled multilevel marketing company that later went bust. The plaintiffs said the Trumps persuaded them to invest hundreds of thousands of dollars in ACN’s desktop video phone service, which was quickly eclipsed with the advent of smartphones. A federal judge in New York rejected the Trumps’ move to force the dispute into private arbitration, but the president and his children are now appealing that ruling. Trump has called the lawsuit politically motivated and argued that he was simply offering his opinion when he endorsed ACN.

 

If Trump loses

It would become easier for the investors’ lawyers to request documents from Trump or even force him to testify at a potential trial. Judges would be less likely to defer to Trump’s wishes, and Trump would be unable to cite his responsibilities as president as an excuse for not complying.

 

Personal Conduct

Mary Trump’s Fraud Suit

Where things stand

The president’s niece Mary Trump last month sued him for conspiring with his brother and sister to defraud her of millions of dollars from her grandfather’s estate using false documents and bogus loans. The president has yet to submit a reply. Mary Trump in July published a bestselling tell-all that painted a harsh portrait of the president as a narcissistic liar. She claims in the book that, when she agreed to settle a dispute over her grandfather’s will, she was told the estate was worth $30 million, but that she learned later it was worth closer to $1 billion. Donald Trump called his niece’s book “a lie” in a Fox News interview but has also accused her of violating a non-disclosure agreement she signed as part of the estate settlement.

 

If Trump loses

It would become easier for Mary Trump’s lawyers to request documents from Trump or force him to sit for depositions. As in the other civil cases, he would lose the ability to cite his responsibilities as president as an excuse for not complying.

 

E. Jean Carroll’s Defamation Suit

Where things stand

Advice columnist Carroll went public in June 2019 with a claim that Trump raped her in a Manhattan department store dressing room in the 1990s. Trump soon responded that Carroll was lying, adding that she was “not my type.” Carroll sued Trump for defamation in New York later that year. Last month, as Trump faced deadlines to provide a DNA sample and submit to a deposition, the Justice Department stepped in, claiming that the president’s statements about Carroll were part of his official duties and that the government should therefore substitute for Trump as the defendant in the case. A substitution would effectively force the dismissal of the lawsuit, since the government cannot be sued for defamation. A federal judge is due to rule on whether such a substitution is legal.

 

If Trump loses

The judge, a Clinton appointee, could deny the substitution request before a new administration takes office. If not, a Biden Justice Department would likely abandon any defense of Trump, though some experts note that Obama’s Justice Department defended certain George W. Bush officials in lawsuits over their sanctioning of torture. Most likely, Trump will again face the prospect of providing a DNA sample and sitting for a deposition.

 

Summer Zervos’s Defamation Suit

Where things stand

A former contestant on The Apprentice, Zervos issued a statement a few weeks before the 2016 election saying Trump groped and kissed her in a hotel room in 2007. He denied the assault and called Zervos a liar, leading her to sue him for defamation in 2017. Trump has argued that he’s immune from suits filed in state court while he is the president, with New York’s Court of Appeals expected to decide the issue early next year.

 

If Trump loses

He would lose his presidential immunity argument—already a longshot since the U.S. Supreme Court ruled in 1997 that President Clinton could be sued in federal court. That means Trump could be forced to sit for a deposition and possibly turn over other evidence related to Zervos’ allegation, win or lose.

 

 With assistance from Laura Davison and Jordan Fabian

 

 

Smart breweries are becoming platforms - btbirkett@gmail.com - Gmail

Smart breweries are becoming platforms - btbirkett@gmail.com - Gmail



Waterloo already has contracts to mix up canned cocktails for Absolut vodka, ciders for Somersby and 10 other concoctions.

There has been much sturm and drang of late around a simple question: what do we want to drink? For awhile it was craft beer, then Millenials, apparently, killed beer. More recently, there was a cocktail craze, at least until teetotaling came back in fashion. Now, apparently, spiked seltzer is the buzz. To Waterloo Brewing Ltd. it doesn't really matter. Over the past eight years, the Ontario-based beermaker spent $65 million to expand its facilities; now it's selling that capacity to the highest bidder. Mind you, Waterloo's in-house beer is moving just fine -- in fact its volume swelled by a 25% in the recent quarter -- but renting its facility is a savvy hedge in a drinks industry grasping at straws. Waterloo is going to suck up business both up-market and down. Liquor giants are keen to try new concoctions and expand in Canada; for these companies, Waterloo is essentially a cheap skunkworks. Meanwhile, the market is awash in beverage startups that have solid brand-building chops, but lack the experience and/or the capital to build a brew-house. Waterloo already has contracts to mix up canned cocktails for Absolut vodka, ciders for Somersby and 10 other concoctions. Waterloo is no longer betting as heavily that people will like its Pineapple Radler, for example, it's betting that the booze industry is frantic to find the next hot category -- it's thirsty as the social media mantra goes. So-called co-packing, or contract brewing, is increasingly common and the strategy shift has pushed Waterloo shares up by a heady 40% this year.  What's interesting here beyond booze is that Waterloo is essentially shifting from a "pipes" business model to a platform. So-called pipe businesses create something, push it down the channel and hope people liked it. Platform businesses simply connect producers to consumers. Waterloo has become a place to publish, if you will, and it gets paid whether consumers like what it's cranking out or not.  To borrow another metaphor, the brewery used to be a TV network, now it's YouTube. More accurately, it's a little bit of both. Netflix may be the best analogy, or HBO, offering a catalogue of original creations and stuff made elsewhere. The drinks business may be chaos, but as they said on Game of Thrones: chaos is a ladder.

Covid-19 Vaccines: Adenoviruses and Coronavirus Latest Research News and Updates - Bloomberg

Covid-19 Vaccines: Adenoviruses and Coronavirus Latest Research News and Updates - Bloomberg

Ailments in Covid-19 Trials Raise
Questions About Vaccine Method

By John Lauerman, James Paton, and Stephanie Baker

October 17, 2020, 8:30 AM EDT

Two Covid-19 vaccines
stalled by potential side effects have one key feature in common: Both are
based on adenoviruses, cold germs that researchers have used in
experimental therapies for decades with varying results.

Johnson & Johnson
said late Monday it would pause its trial to investigate an illness,
which it didn’t specify, in a study participant. Meanwhile, AstraZeneca Plc’s U.S. trial of the
vaccine it’s developing with the University
of Oxford has been halted by regulators for more than a month after neurological symptoms arose in
two volunteers.

With AstraZeneca in a pit stop, vaccines from Moderna Inc. and the Pfizer Inc.-BioNTech SE partnership
have taken the lead in the race to be first out with a shot. Meanwhile, the two
paused trials are reviving questions
about adenoviral vectors, which have been used in laboratory, animal and
human experiments for years. In some cases, the experiments have succeeded, but
not always.

And this year, with Covid-19 vaccines entering strongly into
the politics of the hour, transparency and trust are key to fighting a virus
that’s hit more than 39 million people globally and hamstrung economies. If concerns about side effects in
experimental vaccines in trials using adenoviruses are validated, it
could boost skepticism in the general public and raise questions for other
drugmakers.

“While it could be a coincidence,” said Sam Fazeli, a
Bloomberg Intelligence analyst, in a research note, “there’s still the possibility
that adenoviral vector vaccines run a higher risk of rare side effects --
such as autoimmune attacks like transverse myelitis -- than those of
Pfizer-BioNTech, Moderna or Novavax.”

Pauses to investigate side effects aren’t unusual in vaccine
trials, which require a high safety bar because they’re taken by healthy
people. Oxford has said there’s insufficient evidence to connect the
participants’ illnesses to their vaccine. Its human tests in the U.K., South
Africa and Brazil resumed weeks ago.

Adenoviral vectors are well studied, versatile, and shown to
be well tolerated, making them good candidates for Covid vaccines, AstraZeneca
said in an email. Reactions to the Astra/Oxford vaccine in early studies were
comparable to those seen in previous trials of other vaccines using
adenoviruses, the company said. Oxford researchers declined to comment.

In some cases, experiments using adenoviruses have
succeeded. Earlier this year, for instance, a J&J vaccine based partially
on an adenovirus was approved to fight Ebola, which has killed thousands in
Africa.

In other experiments, though, there were disappointing
results. In 2008, a vaccine using an adenovirus developed by Merck & Co. to
prevent HIV was tied to increased infections among some who received it in a
trial. Merck abandoned the shot, and several similar programs fell by the
wayside.

If investigators in the current trials determine the cause
of the episodes is related to the vaccines, they would look for potential links
to the adenovirus approach as well as to the spike protein the vaccine is designed to make to prepare the immune
system for a real infection, according to Michael Kinch, a vaccine specialist
at Washington University in St. Louis.

At this point, he said, there’s not enough information to
know. “Is this just random chance?” Kinch said. “First and foremost, there’s
bad luck. If it turns out there’s a correlation and a causation, then the
conversation very quickly turns.”

J&J said it’s still learning about the illness of the
participant in its trial. The adenovirus in its experimental Covid shot has
been used worldwide in more than 110,000 people, according to Paul Stoffels,
the company’s chief scientific officer.

“We are building very quickly on a very large safety
database of the carrier,” Stoffels said in an interview before the trial was
paused.

Switching Genes

Discovered in human adenoid glands in 1953, adenoviruses
have a number of features that lend themselves to drug delivery. While some
infect human cells easily, they cause only mild symptoms in most cases. Strains
that appear in different animals, such as cows and chimps, can be adapted to
different purposes, such as veterinary vaccines.

And best of all, scientists have found it relatively easy to
mix and match genes within them, offering a variety of features and properties.

“You take out the genes that control the ability of the
virus to proliferate,” said Ron Crystal, a researcher at Weill Cornell
Medicine in New York who pioneered the use of adenoviruses as vectors, “and put
in your genes.”

Viruses naturally add their genomes to those of cells,
inducing them to make viral proteins. In the 1990s, researchers added genes to
an adenovirus to make an enzyme that was missing in a genetic disorder.

The idea was that infected cells would make the enzyme,
curing the disease. Instead, the first patient to be treated this way died from
a severe immune reaction.

“We didn’t realize how immunogenic these viruses were,”
Crystal said.

The tragic death was a setback for gene therapy, which only
revived in the past few years as a number of potentially life-saving therapies
were approved, and even more are making their way through testing.

In the meantime, drug and vaccine developers continued to
build vaccines around much smaller doses of adenoviruses. When used in
smaller amounts, the immune reaction to adenovirus is “not an issue,”
according to Crystal. If anything, vaccine designers see the body’s immune
reaction as a potential advantage, he said.

“They’re essentially acting as an adjuvant, and that
amplifies the immune response” to the vaccine, Crystal said.

Pre-existing human immunity to chimpanzee adenoviruses like
the one used in the Oxford vaccine is less of a concern, said Lindsey Baden, an
infectious disease specialist at Harvard-affiliated Brigham and Women’s
Hospital in a podcast sponsored by the New England Journal of Medicine.

Still, with such new technologies, “safety is difficult to
know,” said Baden, who’s worked in the HIV vaccine field for decades. “If
you’ve studied it in 1,000 people, you don’t know a 1-in-10,000 risk; if you’ve
studied it in 10,000 people you don’t know a 1 in 100,000, and so on.”

If adenoviruses are associated with the side effects that
have appeared in Covid vaccines, it may set back development of numerous
projects, as it did with HIV and gene therapy. There are more than a dozen Covid vaccines in
development based on adenoviruses, according to the World Health
Organization.

Should investigators in the current trials determine the
cause of the episodes is related to the vaccines, they would look for potential
links to the adenovirus approach as well as to the spike protein the vaccine is
designed to make to prepare the immune system for a real infection, according
to Washington University’s Kinch.

At this point, he said, there’s not enough information to know. “Is this just random chance?” Kinch
said. “First and foremost, there’s bad luck. If it turns out there’s a
correlation and a causation, then the conversation very quickly turns.”

— With assistance by Robert Langreth, Suzi Ring, and Riley
Griffin

Shaky U.S. Hospitals Risk Bankruptcy in Latest Covid Wave - Bloomberg

Shaky U.S. Hospitals Risk Bankruptcy in Latest Covid Wave - Bloomberg

Shaky U.S. Hospitals Risk Bankruptcy
in Latest Covid Wave

By Lauren Coleman-Lochner

October 14, 2020, 2:34 PM GMT+1 Updated on October 14, 2020,
3:37 PM GMT+1

  

AHA predicts losses that top $300 billion by year-end

 Revenues are down
while costs are rising for facilities

A grim reality is setting in across the U.S. hospital
sector: a surge in coronavirus infections is encroaching while most facilities
are still recovering from the onset of the pandemic.

The growing number of cases is threatening the very survival
of hospitals just when the country needs them most. Hundreds were already in
shaky circumstances before the virus remade the world, and the impact of caring
for Covid patients has put hundreds more in jeopardy.

The new coronavirus sidelined
profitable elective procedures and pushed
up costs to keep patients and staff safe. Meanwhile, hospitals are losing
the privately insured patients they depend on as millions of Americans lose
their jobs and employer-sponsored coverage.

“It sort of all comes together as essentially a triple
whammy,” Aaron Wesolowski, vice president for policy research, analytics and
strategy at the trade group American Hospital Association, said in an
interview.

More than 215,000 Americans have now died from the novel
coronavirus and 7.8 million have had confirmed infections, numbers that set the
U.S. apart on the world stage. Though new virus cases fell last month after a
summer spike, Covid-19 is again on the rise, especially in the Midwest. Thirty-eight
states are now considered hot spots, according to the Kaiser Family
Foundation, which considers rising cases, test-positivity rates and new daily
cases per million population in its analysis.

Index of hospital municipal bonds up from post-Covid lows

The AHA has estimated the pandemic will cost U.S. hospitals
more than $323 billion through the end of this year. U.S. hospital revenue
totaled about $1.1 trillion in 2018, according to the most recent AHA data
available. The industry group is asking Congress for an additional $100
billion and full forgiveness of loans made under Medicare’s accelerated payment
program, among other requests for relief.

As many as half of hospitals could be losing money
by year end, Wesolowski said, citing a report it released in July from
Kaufman, Hall and Associates. That’s up from about a third that were
operating at a loss ahead of the pandemic.

More than three dozen
hospitals have already entered bankruptcy this year, adding to a similar
number last year, according to data compiled by Bloomberg. More than a
dozen in rural areas have also shut their doors, according to the Cecil G.
Sheps Center for Health Services Research at the University of North Carolina.
The AHA put the total U.S. hospital count at 6,146 in its most recent report, a
decrease of 64 from the previous year.

The financial pain has flowed through to Wall Street. Many
of the hospitals that entered bankruptcy this year were part of Quorum Health Corp.’s Chapter 11 filing in
April. Quorum’s 24 hospitals and other facilities struggled under the
demands of treating coronavirus patients. In late June, a judge approved the
company’s exit plan, which wiped out shareholders and handed the chain to
creditors.

Returns on junk-rated hospital municipal bonds are down
nearly 4% this year, recovering after losing 10% in March. As the pandemic set
in, Wall Street banks saw a rush of hospitals draw down existing credit lines
and were inundated with requests for new or expanded financing. Junk-rated
munis have since rallied and are overall little changed this year as investors
seek higher-yielding securities.

Shuttered Hospitals

Across the U.S., hospitals are struggling to balance their
books and in some cases, already shutting their doors.

“Rural hospitals are closing down right and left,” Bert
Cunningham, city manager of Bowie, Texas, said in an interview.

Central Hospital of Bowie closed in February and its owners
filed for bankruptcy two months later, debilitated by years of red ink,
Cunningham said. Now the property is up for sale for any use, potentially
leaving the 10,000 residents in its service area -- many of whom are elderly --
30 miles from the nearest acute-care emergency room, he said.

The hospital’s closing could prompt a broader business
exodus from the area. “I’ve had local industry tell us they would consider
cutting staff or closing down,” only adding to the area’s uninsured, he said.

The pain, though, spreads far beyond smaller communities to
larger facilities treating some of those most at risk for serious illness.

Nearly a thousand miles from Bowie, Loretto Hospital on
Chicago’s West Side was also coping with its own challenges. Even before the
pandemic, life expectancy in the city’s Austin neighborhood was just 68.2 years
-- 20 years shorter than a few miles away downtown, according to Chief
Executive Officer George Miller. A full three-quarters of Loretto’s patients
have no insurance or Medicaid, with the latter reimbursing Loretto at about
25 to 30 cents on the dollar, Miller said. Medicare, which
represents just 12% of patients, pays about 50 cents.

The hospital received two rounds of CARES Act money, most
recently for $500,000, but with $100 million of annual hospital expenses,
Miller says it’s not nearly enough. The hospital has spent well over a $1
million on goods to protect its workers. When hospitals throughout the country
were scrambling for supplies, he managed to procure personal protective
equipment through connections with old fraternity brothers.

Larger hospitals hit by later waves of cases learned how to
isolate Covid patients and convince others to come in for some elective surgery
-- the more profitable procedures that pay the bills, said Sanjay Saxena,
co-leader of The Boston Consulting Group’s Center for U.S. Health Care Reform
and Evolution. But disparity between the leading facilities and the rest is
getting starker, he said.

Millions of new job losses mean a cut in the number of
Americans with private insurance -- a critical component for hospitals since
federal payments don’t cover the bills. In an April report, Saxena said
almost two-thirds of U.S. hospitals face “material financial risk” -- compared
with 20% pre-pandemic -- with options extremely limited for the 25 to 30% at
the very bottom.

“There’s not a logical savior for that group,” he said. “No
one’s running to go buy hospitals and certainly not those.”

Over the years, Bowie,
Texas, coped with declining federal payments and residents using its emergency
room for free primary care. Now, with layoffs mounting amid virus-induced
closures, yet another stream of income is dwindling. “If someone loses their
health care they had through work,” Cunningham said, “Who picks up the tab?”

In Chicago, Miller says his facility is carefully managing
cash and expenses, sometimes through delayed payments to certain vendors, and
thankfully has no debt. “Candidly, we rob Peter to pay Paul,” Miller said.

Loretto did get some good news recently, learning that Merck
& Co. had selected it as a site for clinical trials of its coronavirus
vaccine, Miller said.

Meanwhile Mercy Hospital & Medical Center on the South
Side, the oldest in the city and one that treated patients from the great fire
in 1871, has announced it’s closing next year. Says Miller, “Nobody rushes into
the inner city, the West Side of Chicago to build a hospital.”

— With assistance by Emma Court, and Elizabeth Campbell

Deflationary Trends Are Growing More Powerful - Bloomberg

Deflationary Trends Are Growing More Powerful - Bloomberg

Deflationary Trends Are Growing More
Powerful

The latest consumer price index report proves that the path
of least resistance for inflation is lower. 

By Gary Shilling

October 13, 2020, 12:00 PM EDT

After nosediving from March through May as the
pandemic-sired lockdowns devastated U.S. household spending, consumer prices
rebounded in the following four months. Some fear this is the start of a
resurgence of inflation. The Federal Reserve Bank of New York’s survey of
consumer inflation expectations shows a jump from 2.4% to 3% for both one and
three years ahead.

If you think serious inflation is coming, you don’t believe
in the fundamental power of excess
global supply to depress prices. With globalization, Western technology is
combined with cheap Asian labor to produce a vast array of goods and, increasingly,
services. But Asian consumers purchase only a fraction of what they produce. China’s
consumer spending is just 39% of gross domestic product, compared with 68%
in the U.S., resulting in a saving glut
that is highly deflationary.

This glut is unlikely to atrophy even if the U.S.-China
trade war intensifies. Western and even Asian companies such as Samsung,
Hasbro, Apple and Nintendo are shifting production from China to Vietnam,
Pakistan and other Asian countries that have even-lower costs and are out of
the trade war’s line of fire. It’s no surprise that the Federal Reserve, with
all its power, has not been able to push the inflation rate to its 2% target
and is admitting so by saying it will allow inflation to overshoot its target
for a period of time before tightening monetary policy. To be sure, the Fed
isn’t alone among central banks in failing to spark inflation to an acceptable
level.

On a micro level, the pandemic has shown the power of supply
and demand to determine prices. With many still house-bound, the cost of food
at home in September was up 4.1% from a year earlier, but at nearly deserted
schools and workplaces, food costs fell 3.4%, according to the Bureau of Labor
Statistics.

The differences in
inflation between stay-at-home and
out-and-about spending were widespread. The consumer costs of recreational
books rose 4.1% in September from a year earlier. Cable and satellite TV fees
rose 5.0%, newspapers cost 5.6% more, medical care was up 4.2%, cleaning
products prices climbed 4.5% and bicycle prices jumped 1.3%. Prices of things consumed away from home plunged, with
airline fees dropping 25.0%, men’s suit jackets and coat prices declining 18.7%
and women’s dress prices tumbling 16.8%, hotel room rates falling 15.0% and
city transportation costs cratering 16.5%.

Supply and demand forces are also revealed in slumping
energy prices. With people staying at home and not driving, commuting or
flying, demand for crude oil has slumped. West Texas Intermediate prices have
fallen from $58 per barrel at the beginning of the year to a recent $41 even
though U.S. frackers and conventional oil producers have cut output from 12
million barrels per day to 11 million. And that’s after the earlier drop from
$67 per barrel in early October 2018.

The Consumer Price Index overstates inflation in a number of
ways, including its accounting for housing. The statistics assume that
homeowners rent their abodes from themselves, paying market rental rates. This
owner’s equivalent rent component is large, 24% of the CPI, and has risen
rapidly in recent years as rental costs jumped along with robust demand. Owner’s equivalent rent was up 2.5% in
September from a year earlier, but if you stripped that out, CPI edged up
just 0.8% instead of the reported 1.4%. 
I doubt that many homeowners consider rent paid to themselves as part of
their cost of living.

President Donald Trump’s executive order to reduce
prescription drug costs for Medicare recipients to what pharmaceutical
companies charge in other countries is highly deflationary. In the past,
Americans have essentially paid the cost of developing new drugs when foreign
governments buy them closer to marginal costs. Specialty branded drug costs in
the U.S. are up 62% since January 2014, compared with the 10% rise in overall
CPI. At the same time, generic drug costs for Americans have dropped 37%. With
the chronic rise in branded pharmaceutical prices, total drugs, 1.5% of the
CPI, are up 14% since January 2014.

Price spikes due to the emerging coronavirus crisis in the
spring are being retraced as production and supply chains adjust.
Slaughterhouse closings due to infected plant workers failed to stop animals
from growing and adding weight. So now chicken wings and prime rib are abundant
and cheaper than before the pandemic commenced.

Trump’s contraction of Covid-19 has brought home the
persistence of the pandemic and the deflation-spawning weak economic growth
that lies ahead. So does the deteriorating household income and employment
picture. Personal income dropped 2.7% in
August as the extra unemployment insurance benefits expired, and despite
the looming election, Washington is yet to pump more money into households.

Although the unemployment rate fell to 7.9% in September
from 8.4% in August, that’s mainly due to 
temporary layoffs that became permanent as employers abandoned hopes for
a quick recovery. Walt Disney Co. is axing 28,000 theme park workers who
previously were on temporary furlough, and American Airlines and United
Airlines are terminating 32,000. In April, 88% of those who lost jobs reported
their layoffs were temporary, but only 51% thought so in September, according
to the Labor Department. Those reporting permanent job losses jumped from 2
million in April to 3.8 million in September.

As the pandemic-sired recession persists into 2021,
even-lower inflation if not deflation looms. That would be accompanied by
even-lower yields on U.S. Treasury securities. Commodity prices, not just
crude oil, would fall. Online retailers would continue to benefit from
stay-at-home consumers but the pressure on shopping malls would intensify. Many
more heavily-leveraged retailers and others with huge debt service would fold.

This column does not necessarily reflect the opinion of the
editorial board or Bloomberg LP and its owners.

To contact the author of this story:

Gary Shilling at agshilling@bloomberg.net

To contact the editor responsible for this story:

Robert Burgess at bburgess@bloomberg.net

Covid Travel: Airlines and Airports Say EU’s Plan Won’t Revive Flights - Bloomberg

Covid Travel: Airlines and Airports Say EU’s Plan Won’t Revive Flights - Bloomberg

Airlines and Airports
Say EU’s New Travel Plan Won’t Revive Flights

By Siddharth Vikram Philip

October 13, 2020, 3:32 PM GMT+1 

 Industry groups scold
accord struck by European governments

 Measures fail to
replace quarantine requirements for travelers

Airlines and airports said European Union moves to help
restart flights in the region through a more coordinated approach to
coronavirus-related travel curbs are wholly inadequate.

The measures, adopted Tuesday, fail to propose the
replacement of quarantine requirements with coronavirus tests and won’t stop
states refusing entry from other EU countries, the International Air Transport
Association said in a joint statement with Airports Council International and
lobby group Airlines4Europe .

The proposals backed by European Affairs Ministers seek to set a common threshold for entry
restrictions, with unfettered travel allowed between areas with fewer than
25 new cases of Covid-19 per 100,000 people for the previous 14 days, and under
4% of tests showing positive results. None
of the 27 EU states is below that threshold. Neither are the rules binding
on governments.

“We are pretty disappointed,” IATA Director General
Alexandre de Juniac said in a webcast briefing. “We were expecting the European
Council at least to be open to replacing quarantines by testing.”

IATA also backs the reopening of borders between countries
with similar infection rates and longer delays between the announcement of new
measures and their introduction.

Countries across Europe have been sharpening restrictions
after a resurgence in the pandemic, with 700,000 new cases recorded last week,
the most since the start of the outbreak. That grinds against pleas by airlines
to remove curbs they say are stopping people from traveling despite pent up
demand.

De Juniac reiterated calls for further financial support for
airlines and said he expects that some carriers won’t survive the winter at
current occupancy levels. Companies in Latin America and Africa are especially
exposed given a lack of state support there, he said.

ACI head Luis Felipe de Oliveira said he doesn’t expect
government-owned airports to go bust but that privately controlled hubs in
Canada, Europe, Asia and Latin America may be vulnerable.

NYC Tax Revenue Loss Less Than Feared on Increase in Property Taxes - Bloomberg

NYC Tax Revenue Loss Less Than Feared on Increase in Property Taxes - Bloomberg

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Economics

NYC’s Revenue Loss Less Than Feared as Property Taxes Gain

By Martin Z Braun

October 13, 2020, 6:54 PM GMT+1

New York City’s tax revenue from March through August fell by $1.2 billion, or 3.5%, from a
year earlier, a smaller decline than expected, as property tax growth helped
offset a sharp decline in sales-tax receipts because of the coronavirus
pandemic.

Property taxes,
the city’s largest single revenue source, rose 3.9% to $16.3 billion,
according to a weekly economic and fiscal outlook from city Comptroller Scott
Stringer. Sales taxes plummeted 23.2%, or $918 million, after the coronavirus
shuttered thousands of shops, restaurants and dimmed the lights on Broadway. Personal income tax, the city’s second
biggest revenue generator, fell by almost $500 million, or 7.2%.

“Given the lagged nature of changes in assessments, the
impact of the pandemic on property taxes will likely only occur in future
years,” the report said. “Overall, however, the loss in revenue has been more
contained than initially expected.”

Property taxes have traditionally been a stable and
predictable source of revenue for local governments, tempering the volatility
of sales and income taxes that are more sensitive to the economy. During the
Great Recession, which was precipitated by the housing market crash, U.S.
property tax collections declined in only one year, 2011, and by just 1.4%, or
$6.8 billion, according to Census Bureau data. New York City property tax
collections didn’t fall during the Great Recession, according to city’s
financial reports.

New York City, the epicenter of the pandemic’s first wave,
had its credit rating lowered one level by Moody’s Investors Service on Oct. 1.
The downgrade reflected the severity of the pandemic’s impact on the economy of
the most-populous U.S. city and the expectation it will take longer to recover
than most other major cities, the rating company said. Still, tax collections
exceeded estimates by both the city’s Office of Management and Budget and the
comptroller’s office by about $1 billion, for the fiscal year ending June 30,
the comptroller said.

Although millions of Americans are unemployed and
homeowners and small business can’t pay their mortgages, Fitch Ratings doesn’t
expect property collections this fiscal year to be “meaningfully affected,” by
mortgage forbearance programs and delinquencies, the rating company said Sept.
29. Servicers for mortgages pooled into
bonds must advance property taxes to local governments when borrowers don’t
pay, Fitch said. The share of residential mortgages in forbearance was 6.32% as
of Oct. 12, according to the Mortgage Bankers Association.

“It’s in their interest to keep paying because they have a
lien on the property,” said Amy Laskey, a Fitch analyst. “If the property has
any value it will eventually get sold and someone will eventually pay the
taxes. It just may be delayed.”

Without more federal aid, mortgage delinquencies may
increase, placing greater pressure on mortgage servicers, Fitch said.
Delinquencies on property-tax bills for the first two months of New York City’s
fiscal year, totaled $646 million, a $122 million increase, from the same
period last year.

Real estate transaction taxes and hotel occupancy taxes had
the largest percentage declines, 41.5% and 52.9%, respectively. Unsold listings
of Manhattan homes have surged to more than 9,300, a level not seen since the
global financial crisis. Travel restrictions have crushed New York’s tourism
industry.

One bright spot: Wall Street. The Standard & Poor’s 500
Index is up almost 9% this year and investment-bank revenue jumped 32%, hitting
an eight-year high in the first half of 2020, as companies raced to raise cash
in the bond market and trading soared, according to research firm Coalition.

“The strong performance of the stock markets and Wall Street
firms has so far defied most expectations at the onset of the pandemic and the
experience of prior recessions,” the comptroller’s report said.