Last month the re-opening began. Throughout the country different states began opening their economies for business along with certain guidelines. Nonetheless there are some concerns about the timing with some experts warning against the potential of catalyzing a second wave and thus an even greater spike in re-infection and economic hardship.
Change in US Electricity Sources
Government predictions are indicating that in an unprecedented move, US electricity will likely be sourced more heavily from renewable power than coal. The reasoning behind this is partly due to COVID-19 and will have significant ramifications in the fight against climate change.
This marks a substantial change from the situation of 10 years ago when coal provided almost 50 percent of America’s electricity. In addition, it is within the backdrop of the current government’s effort to help the industry by diminishing pollution regulations on coal-burning power plants.
According to the Institute for Energy Economics and Financial Analysis (based on data from the US Energy Information Administration), since March 25, renewable energy sources have been manufacturing more electricity than coal power in the US. The following is a statement from the IEEFA
“The transition away from coal for electricity generation has accelerated in 2020 due to a number of factors, particularly low gas prices, warmer weather, a significant amount of new renewable capacity connecting to the grid late last year, and more recently, lower power demand from the economic slowdown because of the coronavirus.”
COVID-19: How the Big Firms Weather the Storm
COVID-19 is affecting everyone: personally, as a family, a community, a business and globally. In this article we take a brief look at how some firms are faring better than others.
In this kind of crisis climate, the bigger corporations with more resources seem to be managing better, in particular, the tech giants. For example: Amazon, Microsoft and Apple.
Shares of Amazon hiked up almost 30 percent this year from massive increases in online deliveries. Given the increasing need for cloud services, Microsoft also benefited enjoying a 9 percent increase. Apple is an interesting case as its product is not necessarily an essential product and right now demand is higher for those offering essential services. However, once Apple 5G is launched it is anticipated profits will soar.
Overall, as most are realizing, the process of re-opening the economy will take much longer and be much tougher than shutting it down. Even if some states re-open they will not necessarily be able to function at normal levels since they often depend on other states (that have not yet opened) for their products/services. Today, companies are often terribly reliant on firms and individuals nationwide – and even worldwide – for completion of product.
COVID-19: New Type of Purchasing?
Markets are moving in new directions. The demand for digitalization is growing at an extraordinary pace in the age of social distancing.
BlueJeans – one of the world’s largest videoconferencing, screen sharing and video calling companies with around 15,000 customers – is being bought out by Verizon for approximately $400 million. According to Business CEO of Verizon Tami Erwin:
“As the way we work continues to change, it is absolutely critical for businesses and public sector customers to have access to a comprehensive suite of offerings that are enterprise ready, secure, frictionless and that integrate with existing tools.”
BlueJeans will be built into Verizon’s 5G offering. Since companies such as Zoom have faced hacking issues and the New York City Department of Education told workers not to use it, other rival companies are now seeking to profit from the new business opportunity.
COVID-19: Fiscally Recoverable?
We know that the global COVID-19 crisis is hitting firms and individuals very hard in many ways, not least of all financially. What economic experts and financial organizations saying about this?
On the one hand, Kristalina Georgieva, IMF Chief, points out that there has not been a fiscal crisis this bad for over a hundred years, since the Great Depression. She believes it to be “the worst crisis since the Great Depression a century ago,” and not only that, but there will likely be lasting damage.
In the space of merely three weeks, 17 million US employees are now hitting the unemployment line. New York Federal Reserve Bank economists are thus comparing this to a natural disaster (such as a massive earthquake) as a standard financial crisis usually happens over a longer period of time. However, given that there are not the same physical consequences, it is believed that a faster economic recovery will be more likely.
Former US Treasury Chief Economist and Peterson Institute for International Economics contributor Karen Dynan – while noting the 20 percent plummet in the US economy in April and May – is predicting a 7.2 percent rebound in the US economy next year, year-over-year.
Further, on the other hand, some economists are predicting a “solid rebound” once people can get back to work.
Coronavirus Relief Bill
There is a $2 trillion Relief Fund Bill for Employee Retention set up by President Trump. But should that run out of money, he has pledged to seek additional funding from Congress. During a COVID-19 White House briefing, Trump said:
“This is money that’s really going directly to the people who need it, the small businesses who need it, and the workers that need it. When we open, we want to open strong with businesses that are going.”
Known as the CARES Act – the Coronavirus Aid, Relief and Economic Security Act – this has been hailed as “the largest economic stimulus bill in modern history,” more than 100 percent higher than the Stimulus Act initiated during the Financial Crisis of 2009.
Hope for US Economy
President Donald Trump said Tuesday he wants the U.S. economy to “open” back up by Easter Sunday, despite expert warnings about the deadly threat of the coronavirus. Easter is April 12, less than three weeks away. Medical experts had recoiled at Trump’s suggestion that Americans could gather en masse amid the coronavirus outbreak.
America’s Economy
America’s Economy is the world’s wealthiest and most powerful. Even macro-economists find it challenging to picture this as it is just so large. But the numbers speak for themselves. Since 1871 America has been the world’s largest economy. Indeed in 2018 it was measured at $20.58 trillion in 2018 in nominal terms.
For comprehension purposes the only way even macro-economists can fathom this enormity is by looking at GDP and labor force numbers as well as trade balances.
So let’s now look at trade balances. Last year goods and services trade deficit was valued at $616.8 billion; imports – $3.1 trillion and exports – $2.5 trillion – not the best figures. Adding insult to injury the trade deficit just for goods was $866 billion.
However, there was still a decline in the overall trade deficit for America in 2019 so that is definitely a good sign. Moreover, the US’s goods deficit with China declined too. Still, experts believe that many more stringent policies must be put in place to further reduce the deficit.
Recharge Your Community’s Economy
Four one-day workshops are being offered – at no fee – by Native American Development Corporation, Rural Community Assistance Corporation and the People’s Partner for Community Development. The first one is next week, March 24. This will be followed by April 28, May 12 and June 16 – each one will follow from the one before and will last for 6 hours.
To be held at the Charging Horse Casino Bingo Hall (on East U.S. Highway 212), they will start at 9am and finish at 3pm. The subjects covered include: an analysis of where the economy is today; pinpointing emerging economic opportunities for the future; how to select the right leaders who are best equipped to respond to those opportunities; a development of plans to make those visions a reality.
US Economy: Growth Industries
The cement industry in America seems to be faring well. One measuring tool is cement consumption and right now it has been relatively high. What’s more is that experts anticipate it will continue to grow (albeit modestly) over the next few years. As Portland Cement Association’s Senior VP and Chief Economist Ed Sullivan pointed out:
“The economy doesn’t have the zip and the vigor that it had 10 years ago, and so what we’re seeing is the economy’s now in late stages of economic growth and recovery. That suggests that overall growth is going to start to slow, which is reflected in a slowdown in GDP numbers. It’s also reflected in our slow-down in job creation numbers.”
Sullivan added that both job creation and consumer sales numbers have not plummeted at all which is also a good indicator of stabilization and continued growth as well as an increase in home prices.
There have been some upturns in solar job industry following a dip in employment in the industry. Employment in the solar industry jumped by 2.3 percent in 2019 and 5,600 jobs were added during the same time frame. In addition, 31 states had an increase in solar jobs in 2019.