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Trump’s Stimulus Shutdown Falls Hardest on 12 Million Unemployed By Bloomberg

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© Reuters. Trump’s Stimulus Shutdown Falls Hardest on 12 Million Unemployed

(Bloomberg) — The hardest blow from President Donald Trump’s decision to shut down stimulus talks is set to fall on more than 12 million unemployed Americans, who already faced an increasingly tough time getting back to work.Income support for the jobless has been plunging, even as the labor market’s recovery from the pandemic slump runs out of steam. An initial wave of re-hiring by companies has tempered and corporate giants like Walt Disney (NYSE:) Co. and United Airlines Holdings (NASDAQ:) Inc. have announced plans to lay off tens of thousands of workers –- highlighting the risk that many jobs lost during the coronavirus crisis won’t be coming back.

Federal Reserve Chair Jerome Powell sounded the alarm about job prospects for the unemployed, especially low-income Americans, in a speech Tuesday. He said income support has been crucial to the U.S. recovery, and urged the government to keep on spending until the economy is “out of the woods.”That call was effectively rebuffed by Trump hours later, when he said there’ll be no further negotiations on another pandemic relief bill before the Nov. 3 election. U.S. stock markets tumbled on the announcement, before recouping most of the losses early Wednesday.

Money Runs Out

The impact on jobless Americans will likely be more lasting — and as they’re forced to lower spending, it will hurt the wider economy too.

“The marginal households, and there are a lot of marginal households, are going to have to start cutting back pretty soon,” said Joel Naroff, president and chief economist at Naroff Economics LLC.

Additional $600-a-week benefits approved by Congress early in the pandemic expired in July. Trump ordered stopgap payments of about half that amount, but delivery has been patchy and those funds are now running out too.

The president’s move this week means there probably won’t be another package of economic support to fill the gap until even the new year.

Trump signaled Wednesday that he may not have closed the door completely on pandemic spending — tweeting his support for piecemeal measures to help small businesses and airlines as well as another round of stimulus checks — but he didn’t mention the unemployed.

The U.S. jobless rate has fallen by almost half from a peak close to 15% in April, right after the coronavirus struck. But the rebound in labor markets is losing momentum.

Initial jobless claims -– which fell for most of the summer — have held between 800,000 and 900,000 for five weeks. The next weekly report is due Thursday morning.

Another ominous sign was the number of long-term unemployed — those who’ve been out of work for 27 weeks or more — which posted the biggest jump in decades last month, rising by 781,000 to 2.4 million.

Powell said Tuesday that broader measures show unemployment still running at around 11%, and warned that low-income workers have been hardest hit. Employment among the poorest one-fifth of workers is down more than 20% since February, while for the rest of the labor force the decline is only 4%, the Fed chief said.

“The burdens of the downturn have not been evenly shared,” Powell said. “The pandemic is further widening divides in wealth and economic mobility.”

What Bloomberg’s Economists Say

“Extension of small business aid and augmented jobless benefits would have helped guard against substantial downside risks to the economy in the coming months. It would mean the pandemic itself would continue to serve as the primary constraint to spending, not insufficient income.”

–Andrew Husby, Read more here.

As the prospect of more budget support for the economy recedes, at least in the short term, there may be more pressure on Powell and the Fed to take further monetary measures. Options include stepping up bond purchases and targeting them toward longer-duration securities, Evercore ISI analysts wrote on Wednesday.But with interest rates already at zero, economists are skeptical that the Fed has much in its toolkit to deliver an immediate lift, or one that’s capable of targeting the lower-income Americans who’ve been worst hit — one reason why Powell and his colleagues have been so vocal in pleading for fiscal stimulus.

©2020 Bloomberg L.P.

 





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Sale of Teva’s Jerusalem tablets plant cancelled

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The real estate deal between Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) and the Levinstein group has finally be cancelled. News that the deal would be cancelled was first reported by “Globes” three months ago. Just two weeks later, Levinstein confirmed that it was in talks with Teva on the possibility of cancelling the deal or changing its terms.

The deal in question was for the sale of a property in Jerusalem’s Har Hotzvim industrial zone that housed Teva’s tablets factory until it was decided to end that activity as part of the major streamlining program that the company has been implementing in recent years in order to reduce its debt. In March 2019, Teva and Levinstein signed an agreement for the sale of the property for NIS 171 million. The deal was due to have been completed in June 2020, but completion was postponed to the third quarter of 2020. The property has 34,000 square meters of built space, with rights for 70,000 square meters.

The deal was signed with Levinstein Properties Ltd. and its parent company Meshulam Levinstein Contracting and Engineering Ltd. (TASE:LEVI), the division between them being 60% for the subsidiary and 40% for the parent company. The group planned to let the property for various uses, and to exploit the additional building rights. The two companies made advance payments to Teva in 2019 and paid purchase tax.

The Levinstein group notified the Tel Aviv Stock Exchange yesterday that “in the light of disagreements between the sides over actions that should be carried out before the property is handed over, the sides cancelled the agreement by mutual consent.” Teva will repay Levinstein the advance payments, and each side will bear its own costs. A mutual waiver of legal claims has been signed.

As “Globes” reported in July, as in many other cases in which attempts have been made to change the terms of signed agreements or cancel them altogether, because of the coronavirus crisis, Levinstein tried to alter or cancel its deal with Teva. Among other things, the question arose whether the site was contaminated, since it had been used for years for pharmaceuticals manufacture. After an inspection by the Ministry of Environmental Protection, however, Teva was given confirmation that there was no contamination of the land.




In the framework of the streamlining program, a nearby Teva plant for producing inhalers was also closed, and the property on which it stood was put up for sale. Teva sold the property to Vitania Ltd. (TASE:VTNA.B1 for NIS 107 million – a deal that has already been completed. Teva has managed to reduce its debt by $8.4 billion since the streamlining program began, but total debt at the end of the second quarter was still a high $26.3 billion.

Published by Globes, Israel business news – en.globes.co.il – on October 22, 2020

© Copyright of Globes Publisher Itonut (1983) Ltd. 2020




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Yedioth Ahronoth plans firing 150-200 journalists

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With the Covid-19 crisis hitting the print media hard, Yedioth Ahronoth is to implement major streamlining measures including laying off 150-200 journalists, Sources close to the matter have told “Globes” that the newspaper’s workers committee and the Israel Journalists Association are holding a Zoom meeting this evening at which employees will be told about management’s plans and options to oppose them.

A message from the worker’s committee to employees said, “Yedioth Ahronoth Group’s management has informed us that of their intention to make across the board cuts in the workforce in which many of the Group’s journalists are expected to be dismissed. Management intends going ahead with firing many dozens of journalists throughout the Group in the coming weeks and for this purpose a number of meet5ings have been fixed for talks with the workers committees and representatives of the Journalists Union.”

Yedioth Ahronoth Group has three divisions. The digital division, which was the most profitable before the crisis and where no cuts and layoffs are expected, though some jobs may be merged. Most of the cuts will be in the daily newspaper division and the media division.

Even before the crisis, the print media was losing ground to the Internet and the Covid-19 pandemic has simply hastened the process.

Journalists at Yedioth Ahronoth and its sister financial newspaper Calcalist have a collective agreement protecting them from layoffs until February 2021. It is not clear whether the newspaper intends respecting the agreement but in any event the journalists are only protected for a few more months.

The Journalists Union declined to comment on the report and no response was forthcoming from the office of Yedioth Ahronoth Group CEO Zion Peretz.

Published by Globes, Israel business news – en.globes.co.il – on October 12, 2020

© Copyright of Globes Publisher Itonut (1983) Ltd. 2020




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Israeli cyber intelligence co Cellebrite signs deal in UAE

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Israeli cyber company Cellebrite signed a deal in Abu Dhabi at the beginning of this month, “Globes” has learned. The deal is estimated to be worth $3 million, and was apparently signed with a government agency in Abu Dhabi.

The tools developed by Cellebrite are used by law enforcement agencies and military and intelligence agencies to obtain data and identify dangerous activity. They are also used by some of the world’s largest business corporations, such as Apple, Google, Verizon and major banks, for the purposes of (legal) internal investigations.




A source familiar with the details said that the deal was brokered by former Mossad executive David Meidan, who was formerly Prime Minister Benjamin Netanyahu’s envoy for captured and missing soldiers and who negotiated the release of Gilad Shalit, who was captured by Hamas. Cellebrite and David Meidan declined to comment on the report.

Cellebrite’s systems gather and analyze data from mobile telephones and personal computers, cloud computing, and even from civilian drones caught by security forces. According to its figures, in mid-2019 the company had 45% of the mobile telephone forensics market, and its managers have said in the past that its products represent the first work tool in 75% of police investigations globally.

In recent months, several petitions have been filed against Cellebrite, demanding that it should come under the supervision of the Ministry of Defense, because of claims concerning the regimes in the countries whose security agencies are customers of the company.

Published by Globes, Israel business news – en.globes.co.il – on October 22, 2020

© Copyright of Globes Publisher Itonut (1983) Ltd. 2020




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