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  1. #1006

    Re: The Failing Economy

    The internal polling must be brutal.
    “No matter how cynical I get, I just can't keep up.” – Lily Tomlin.




  2. #1007

    Re: The Failing Economy

    And straight out of the Dictators' Playbook. Chavez did that around 2005. If there are no economic data, there is nothing to criticize.
    Face it. It's the apocalypse.

  3. #1008

    Re: The Failing Economy

    Quote Originally Posted by ponchi101 View Post
    And straight out of the Dictators' Playbook. Chavez did that around 2005. If there are no economic data, there is nothing to criticize.
    Yeah because people won't notice they're unemployed and can't pay the rent/mortgage.
    “No matter how cynical I get, I just can't keep up.” – Lily Tomlin.




  4. #1009

    Re: The Failing Economy

    My reaction to that article was: If we had a Democrat in office at a time like this, and he/she did not release the economic data, the Republicans would be screaming bloody murder. I like to remind all of us from time to time about the degree of hypocrisy we have seen in the last 3 1/2 years. GH

  5. #1010

    Re: The Failing Economy

    Quote Originally Posted by ponchi101 View Post
    And straight out of the Dictators' Playbook. Chavez did that around 2005. If there are no economic data, there is nothing to criticize.
    The Kirchners also intervened state agencies that measured poverty, inflation, etc etc.
    Meet again we do, old foe...

  6. #1011

    Re: The Failing Economy

    Desperate retailers to ask Fed, Treasury for emergency help amid worries that economic turmoil could worsen
    As some companies topple into bankruptcy, others struggle over what to do with a glut of unsold goods

    By
    David J. Lynch and
    Abha Bhattarai
    May 31, 2020 at 7:00 a.m. EDT

    The nation’s retail industry is swamped with stuff and short of cash.

    As they reopen stores full of merchandise from March that no one will want in June, retailers are struggling to make room for summer goods trapped in overstuffed warehouses.

    With five big retailers having filed for bankruptcy in May, some of the industry’s survivors can’t get financial backing for their holiday season orders — prompting an urgent appeal to the Treasury Department and Federal Reserve for help.

    Even though stores were closed for much of March and April, huge amounts of shoes, shirts, suits and swimwear poured into the United States from global supply chains that continued churning despite the pandemic. Retailers have to decide what to do with their leftover March goods and a glut of seasonal gear while they place their bets on what consumer spending will look like in six months.

    “The lion’s share of our spring inventory is still in distribution centers,” said Tom Cusick, chief operating officer of Columbia Sportswear. “There was no time to prepare before our stores shut down in mid-March.”

    Weakness in the roughly $3.8 trillion retail sector could ripple across the wounded U.S. economy, hobbling prospects for a rapid recovery from the unprecedented economic shutdown put in place to combat the pandemic, economists said.

    Without a Treasury or Fed guarantee of its routine financing, the retail industry could suffer “a commercial credit crisis that threatens to seize up our economy and stall the safe restart in its infancy," the American Apparel and Footwear Association will warn Treasury Secretary Steven Mnuchin and Federal Reserve Chair Jerome H. Powell in a letter early this week. The trade group represents more than 1,000 name-brand companies, including manufacturers and retailers.

    The wholesalers that supply retail giants are caught in a financial squeeze. Just when they need more credit to compensate for the pandemic cutting off their cash flow, financial institutions that customarily support them are pulling back, the association will say in the letter, reviewed by The Washington Post.

    “Unless this is fixed soon, the retail engine that supports one in four American jobs will have a hard time coming back to life,” a draft of the letter says.

    More than 2.1 million retail workers in April lost their jobs as nonessential businesses closed to ride out the health scare, while companies such as Neiman Marcus and J. Crew toppled into bankruptcy.


    More retailers probably will follow. Even as giants Amazon and Walmart thrived, cash-strapped mall tenants failed to make three-quarters of their rent payments in April, leaving more than $1.3 billion unpaid, according to CoStar Group. (Amazon founder Jeff Bezos owns The Washington Post.)

    National chains like Macy’s and Urban Outfitters have canceled orders placed before the pandemic. Foot Locker, saddled with 20 percent more inventory than one year ago, is offering deep discounts on spring clothing and footwear. Other companies are waiting until the last possible moment to determine whether newly arriving goods will be sold through a physical store or online channels, said Razat Gaurav, chief executive of Llamasoft, a supply chain consultancy.

    “Store inventory hasn’t been moving because distribution centers don’t have enough storage capacity. There’s a backup,” said Gaurav. “They’re trying everything possible to make room.”

    As the coronavirus forced retailers temporarily to shut more than 260,000 U.S. stores, retail sales plunged a record 16.4 percent last month. Clothiers fared the worst, with sales down 89 percent from a year earlier, according to Commerce Department data.

    Department store chain Kohl’s, with more than 1,150 stores in 49 states, told investors May 19 its gross profit margin in the first three months of the year plummeted by more than half, largely because of excess inventory and shipping costs. To ease a cash crunch, the company temporarily delayed vendor payments for up to 100 days.

    In Europe, Bestseller, a privately held Danish clothing company, receives an average of 6 million pieces of clothing each week, even though its stores are closed, its chief executive last month told Berlingske, a Copenhagen newspaper. After renting all available warehouse space in southern Jutland, the company still had 1,000 shipping containers lined up outdoors.

    “We have definitely seen significant order cancellations, closed shops not wanting to take delivery, full warehouses, and even customers asking if there were slower ways to bring their shipments across the ocean,” Phil Levy, chief economist for freight forwarder Flexport wrote in an email.

    When the pandemic shutdown began in March, some distribution centers were stuck with apparel packaged on hanging garment racks for delivery to stores. Before the items could be diverted to online channels, they had to be removed, folded, repackaged and labeled for shipment to consumers’ homes. Many facilities lack adequate space for that work, Gaurav said.

    The pandemic hit as retailers were still shaking off the effects of the tariffs President Trump imposed on most goods from China and as the industry was navigating an ongoing shift from traditional brick-and-mortar stores to online sales.

    The industry’s supply networks have been disrupted since January when Chinese authorities responded to the novel coronavirus outbreak by effectively closing down their economy, a major source of textile and apparel production.

    Chinese factories resumed production just as major parts of the European and American economies were closing. Given the weeks between order placement and goods’ arrival in U.S. ports, ships continued steaming across the Pacific even after the U.S. shut down.


    Many of Columbia Sportswear’s raw material suppliers closed their Chinese factories in January. Even once they resumed production, it was difficult to get items out of Chinese ports to apparel manufacturers in countries like India and Vietnam, delaying deliveries of fall merchandise.

    The company’s distribution centers in Portland, Ore., and Robards, Ky., are jammed with raincoats, shorts, sandals and other warm-weather apparel as the company struggles to clear leftover winter merchandise from its stores.

    “It’s really across the board that we have an excess — footwear, rainwear, shorts, T-shirts, sandals,” said Cusick, the Columbia executive. “And it’s not just us. It’s a nationwide challenge.”

    Under normal circumstances, the retail industry simultaneously designs, produces and sells products for distinct seasons. The pandemic unexpectedly interrupted this synchronized process, creating a merchandise traffic jam with all the grace of a multicar pileup on the freeway.

    The disruption has been especially evident in clothing and department stores, according to preliminary Census Bureau data.


    The inventory-to-sales ratio for clothing stores more than doubled in March, as stores closed and shipments continued to arrive. Likewise, the figure for department stores jumped to unusually elevated levels.

    Off-price retailer Ross Stores has temporarily stopped buying inventory as it tries to sell what it calls “aged seasonal goods” in its stores and distribution centers. Meanwhile, executives at TJX Companies, which owns TJ Maxx, Marshalls and HomeGoods, say they have marked down items “significantly more” than usual to clear shelves of dated merchandise.

    “The marketplace is loaded with inventory,” chief executive Ernie Herrman said in an earnings call last week. “As a company, we’re aggressive on clearing goods.”

    Many retailers are offering deep discounts on spring clothing, while others are offloading items to discounters or putting seasonal items in storage for next year. Some large retailers are even shipping spring apparel back to China, in hopes of selling it on online platforms like Alibaba, according to Deborah Weinswig, chief executive of Coresight Research, a retail advisory firm.

    “Every retailer is handling this differently, but for the most part, everything is on hold," she said.

    Whatever inventory strategy is used will entail losses. Retailers may sell some products below cost while paying storage bills for items they hope to salvage for next year.

    “It may be less expensive to pay the carry costs, but companies that have to raise cash may have no choice,” said Allan Ellinger, senior managing partner for MMG Advisors, a N.Y.-based investment bank.

    Analysts say the surplus of inventory, combined with slowing sales, has put countless retailers in a tight spot to fund future purchases. As the industry reopens, a tightening of credit conditions could dampen the rebound, according to Stephen Lamar, president of the American Apparel and Footwear Association.

    Insurers such as Euler Hermes and Coface, which protect merchandise suppliers against the risk retailers won’t pay their bills, are limiting the amounts they will guarantee, even for longtime clients. Just three months ago, a wholesale supplier with a $1 million contract from a major retailer could have bought insurance on $800,000 of that business. Today, the wholesaler might secure only a $100,000 guarantee on the same $1 million, making the order too risky to complete, according to AAFA.


    The industry group wants Treasury or the Fed to provide “credit insurance backstops” to facilitate the resumption of normal retail business. Last month, the German government unveiled a 30 billion euro guarantee for its companies, which mirrored similar moves by France and Belgium.

    Credit insurers are increasingly risk averse, finding it difficult to predict future consumer demand and sales prospects especially for midsized retailers, said Paul Rotstein, CEO of Gold Medal International, which supplies hosiery and cold weather accessories to retailers such as Nordstrom, Macy’s and Dick’s Sporting Goods.

    “With retail being shut down — except for a handful of big retailers — there’s no cash flow forecast you can rely on. So their response is to greatly reduce, or pull, the credit line on everybody,” said Rotstein. “If the credit insurance dries up, I can’t afford to bear the entire credit risk on my own and that will greatly reduce my sales.”

    Paris-based Euler Hermes, a leading credit insurer, expects a 20 percent increase in global bankruptcies, underscoring the risk it faces in guaranteeing payments. The price of credit insurance for suppliers to major retailers has accordingly risen.

    Likewise, Coface is bracing for higher insurance claims as retailers suffer from lower demand, said Oscar Villalonga, Coface’s CEO for North America.

    “This is a very extreme scenario we’re all going through,” said Villalonga, calling the environment “much more severe” than 2008.

    Villalonga declined to comment on press reports that Coface had stopped writing policies on some cash-strapped retailers including Macy’s. A spokesman for the department store chain also declined to respond to the reports, which said Euler also had halted coverage.

    The glut of merchandise also creates challenges for companies as they finalize orders for the fall and winter holidays. Many retailers, low on cash and unsure of consumers’ return, are ordering only 50 to 75 percent of last year’s holiday inventory, according to Weinswig of Coresight Research.

    Some also are investing more in basics they can sell year-round. Online lingerie brand ThirdLove is deferring trendier items, like lace bras or pieces in seasonal colors, to 2021, according to co-founder Heidi Zak.

    “It’s virtually impossible to forecast right now," she said. “We’ve had to use two weeks of data to make four to six months of supply-chain decisions."

    Eva Dou contributed to this report.

    https://www.washingtonpost.com/busin...virus-economy/
    “No matter how cynical I get, I just can't keep up.” – Lily Tomlin.




  7. #1012

    Re: The Failing Economy

    Donny "bailed out" his crony's instead of conveneing a group to look at this kind of economic fall out but hey, he can golf so what does he care?
    “No matter how cynical I get, I just can't keep up.” – Lily Tomlin.




  8. #1013

    Re: The Failing Economy

    Oil refineries, offshore drillers face hurricane challenges amid pandemic
    HOUSTON (Reuters) - As oil and gas companies began shutting offshore production before the first tropical storm of the season in the U.S. Gulf of Mexico, experts said restarting wells and refineries will take longer and prove more costly this year because of COVID-19.

    Well shut-ins typically last a few days or weeks at most, but oil companies have adopted stringent virus precautions for refinery and offshore staff, including frequent health checks, travel restrictions, onsite protective gear, and longer work stints with pre-departure quarantines.

    More time-consuming evacuations and slower restarts could lengthen post-storm recoveries, and potentially deliver a knockout blow to small offshore facilities, said William Turner, a vice president at research and consultancy Welligence Energy Analytics.

    “There is an economic hit when a hurricane comes through,” said Turner, and for smaller producers strained by low prices a bad storm may be the last straw for their production.

    “Some assets won’t be worth turning back on,” he said.

    U.S. energy companies face their first test of hurricane restarts under COVID-19 this week from the approaching Tropical Storm Cristobal. Three have already evacuated workers and shut some production.

    National Hurricane Center forecasters expect up to 19 named Atlantic storms this year with three to six becoming major hurricanes, above the average 12 storms and three major hurricanes.

    STORM AIMS FOR OIL FACILITIES
    Cristobal is expected to enter the central Gulf this week, an area rich with offshore platforms, and could see landfall along Louisiana’s refinery row on Sunday.

    Gulf Coast refineries and seaports account for 45% of U.S. oil processing capacity and the majority of energy exports. Some 1.93 million barrels per day (bpd) of oil, or 15% of the U.S. total, also comes from U.S. Gulf of Mexico waters.

    COVID-19 already has raised costs and added travel headaches for offshore crews and complicated working conditions for refinery operators. Royal Dutch Shell hired helicopters to individually ferry out three workers on the same platform suspected of having the virus to isolate them from one another, said a Shell spokeswoman

    Exxon Mobil Corp recently required a repair crew to quarantine for two weeks before allowing them to access its Destiny platform off the coast of Guyana, the country’s Environmental Protection Agency chief, Dr. Vincent Adams, told Reuters

    “Repairs have been necessarily delayed in order to observe travel restrictions and safety and isolation protocols related to COVID-19,” said Exxon spokesman Todd Spitler.

    Some 120 offshore Gulf of Mexico workers have tested positive for the virus this year, and a greater number were evacuated preemptively, according to a National Ocean Industries Association spokesman.

    Chevron Corp and others have lengthened offshore crew schedules to at least 21 days from 14, closed gyms and staggered meal breaks to reduce the risk of coronavirus outbreaks. Workers who spike a fever or exhibit signs of illness are whisked off for onshore medical care.

    Post-hurricane restarts will also change. BHP Group quarantines employees heading to its offshore platforms in a Louisiana hotel and expects workers evacuated from rigs during storms to stay at the same or another onshore hotel until the danger passes and they can return to the platform.

    Under normal circumstances, “we do not expect the challenges associated with COVID-19 to significantly impact our production deferrals,” said BHP spokeswoman Judy Dane.

    MASKS IN CONTROL ROOMS
    At Gulf Coast refineries, the crews assigned to remain onsite during a storm will wear masks if they cannot be six feet (1.8 metres) away from another person while working at control boards, a person familiar with the matter said.

    The “ride-out” team will also have temperature checks before entering the facility, and be required to self-report any symptoms of the illness, the person said.

    “CDC-recommended guidelines and safety practices, including daily self-health assessments, limited gathering sizes, social distancing, wearing masks where appropriate, will remain in effect at our refineries,” said Lillian Riojas, spokeswoman for Valero Energy Corp
    "And for my next fearless prediction..."

  9. #1014

    Re: The Failing Economy

    Coronavirus frustrates Saudi women's push for financial independence
    Al ULA, Saudi Arabia (Reuters) - Abeer al-Howayan despaired of ever working after spending eight years trying to find a job that would put her chemistry degree to use in the Saudi Arabian town of Al Ula.
    She eventually abandoned her scientific ambitions and turned to selling homemade cakes, before she was chosen last year for a government training programme to support a $20 billion flagship tourism project in the kingdom’s northwestern region.

    The 31-year-old learned how to make artisanal soap from French experts flown in by Saudi authorities, and in late December started selling her creations at a booth near the rock-hewn tombs of Madain Saleh, site of an ancient civilization. She also started offering her wares online.

    Then the coronavirus struck. Even after all her compromises, Howayan’s future is uncertain once again.

    The pandemic has hammered Saudi Arabia’s nascent non-religious tourism industry - among the few new sectors to have emerged under Crown Prince Mohammed bin Salman’s drive to diversify the economy from oil and create millions of jobs.

    “It is very tough, but I keep telling myself things will get better after corona. One has to remain optimistic,” Howayan, whose online business has also slowed, told Reuters.

    Women in the United States and Europe have taken an outsized hit from the wave of unemployment caused by the coronavirus, but for women in Saudi Arabia the downturn is particularly damaging because it struck just as their efforts to enter the workforce and gain greater financial independence were gaining traction.

    Howayan is among nearly one million unemployed Saudis - 12% of the working-age population - pinning their hopes on the prince’s vision to modernise the conservative and patriarchal country with ambitious projects. Women make up about 83% of the jobless, according to the Saudi statistics office. And it’s an educated group; 70% of those women have high school diplomas or university degrees. And many were counting on the new sectors such as tourism to provide their entry to the workforce.

    PRIVATE SECTOR SQUEEZED
    Tackling unemployment is a main pillar of Prince Mohammed’s plan. He promised in 2017 “better unemployment numbers by 2020” and to cut the jobless rate to 7% over the next decade. But the rate has fallen by less than 1 percentage point. A tough task has become even tougher as coronavirus disruptions and austerity measures have squeezed the finances of the private sector.

    “To reduce unemployment, the private sector will need to create at least 500,000 to 1 million jobs for Saudis, said John Sfakianakis, a Gulf expert at the University of Cambridge, “But this year alone, the private sector will unavoidably contract by 7% ... and that’s just this year.”

    Finance Minister Mohammed al-Jadaan told Reuters that the government remained committed to job creation targets and was still funding training and capacity building. “Coronavirus is with us this year and possibly for a part of next year, but then it will go away and when it goes away we need to make sure that we have seized this time to build more capacity and train more people to be ready when we start offering services again,” said Jadaan. He did not specifically address the issue of women.

    According to regional experts, a faltering of the reform drive could lead to the public questioning the social contract between the ruling Al Saud family and the people in a country where 80% of the population is under 30.

    Oil wealth is shared across the kingdom in exchange for popular submission to absolute monarchical rule. However there could be some social discontent if jobs do not materialize and Saudis find themselves paying more taxes with less state benefits, according to Yasmine Farouk at the Carnegie Middle East Center. “It will eventually guide the country into a political discussion that the leadership doesn’t want,” she said.

    ENDING GENDER SEGREGATION
    Saudi Arabia has largely struggled to lure foreign capital outside the energy sector as many investors hesitate over Riyadh’s human rights record and the commercial viability of some domestic mega projects. But the entertainment and tourism industries started taking off last year, accompanied by social reforms to open up the kingdom, including ending gender segregation in most public places and introducing public entertainment. Thousands of jobs were created and Saudis flocked to concerts, festivals and sporting events.

    Last year, the kingdom attracted international acts from Cirque du Soleil to Mariah Carey, Italian tenor Andrea Bocelli and Greek musician Yanni. Saudis also cheered female WWE wrestlers in Riyadh, and heavyweight boxers Anthony Joshua and Andy Ruiz Jr in a custom-built 15,000 person stadium. However the Saudi tourism minister told Reuters in April that the industry, including Muslim pilgrimages, could decline by 35-45% this year due to coronavirus measures.

    Abeer Mohammed Jumuah is another example of a woman who benefited from the prince’s reform drive. She spent years looking for a job as a teacher after graduating from university in home economics, and eventually joined a government training programme last year to learn cooking skills in Paris. The 31-year-old has returned to a catering role in Saudi Arabia helping Michelin-starred chefs, but it is only temporary and she will eventually need to find new work - something that has become a trickier proposition in the wake of the pandemic.

    “I hope that one day I can open a café where I can offer a breakfast menu with lots of French pastries,” she said. “I want to be financially independent and I want my two daughters, aged four and seven, to have a better living standard.”

    CHANGING EXPECTATIONS
    Analysts said they expected a recovery in tourism and entertainment to start in the first half of 2021, with the sectors requiring government support for at least a few years. The Royal Commission for Al Ula, set up in 2017 to carry out reforms in the crown prince’s drive, said it planned to reopen in October this year, and a spokesman said it was committed to job creation.

    Some are hopeful for the future. Madiha al-Anazy, 29, joined a five-month tour guide training programme when she returned from Florida in May 2019 with a masters degree in biotechnology, and now has a permanent job as a tour guide.

    Her 33-year-old husband, Mohamad, was temporarily taken on as a part-time “ranger” to protect heritage sites and the couple is betting on a revival in the tourism sector.

    “We hope he will find a permanent job one day,” Anazy said.

    Private-sector job creation is partly intended to wean citizens off reliance on the state as more than two-thirds of the Saudi workforce is employed by the government and their salaries account for roughly half of 2020 budget spending. Low oil prices would make it difficult for past state largesse to continue. This could lead to many young Saudis taking lower-income jobs typically relegated to foreigners, in a societal shift, according to Karen Young, a Gulf analyst at the American Enterprise Institute in Washington.

    “People’s expectation for income and lifestyle are going to be different to their parents,” she said.
    "And for my next fearless prediction..."

  10. #1015

    Re: The Failing Economy

    Jeanna Smialek
    @jeannasmialek
    (Federal Reserve Chair) Powell sounds really worried about this: "My assumption is that there will be a significant chunk, well into the millions," of "people who don't get to go back to their old job... there may not be a job in that industry for them for some time."

    "It's very tough on their lives."

    He's also talking about a return to 2009 recession level unemployment of about 9%.

    https://www.washingtonpost.com/busin...mments-wrapper
    “No matter how cynical I get, I just can't keep up.” – Lily Tomlin.




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