Friday, March 27, 2020

Depressing but Necessary to Hear: This Thing Won’t End Soon

Over the past week, there have been a wide range of forecasts, possibilities, expectations, timelines, and statements about when we can expect American life to return to normal.

Some are reasonable and some are not.  But the more you understand the truth about where we are now, you can see that we’re not getting out of this quickly. 

First, our president’s call for everything to be back to normal by Easter, now 16 days away, is insane.  Coronavirus is not a nightmare which we can end by waking up.  It is not HIV, with almost every case preventable.  The United States is now purported to have more coronavirus cases than any other country.  While I think the numbers are usually misleading, reflective of our more open information sharing and always out of date before publication, they are, as you read this, sharply increasing, and will continue that for at least a month or two.  True, it will cost our government a trillion dollars per month to keep everyone reasonably afloat, getting us a national debt in the dozens of trillions, but this is the territory in which we now live. 

Second, the social distancing, critical to reduce the spread of this long-lasting and highly contagious virus, will need to continue until almost all Americans are immune.  That, even more than the shortage of medical equipment, medical personnel, and hospital space, will put severe restrictions on our freedom.

Third, with viewpoints, recentness of information, and sources varying, there have been a lot of false hopes spread about when we, for example, might be able to comfortably travel again.  If not Easter, many are acting as if all of this might be over by May, but that makes no real sense either. 

For your planning realism, here is what I expect to happen.  Any normalcy we have before Christmas will be a bonus.  There will be no 2020 major league baseball season.  The NFL will probably delay, then cancel, theirs as well.  The Kentucky Derby, now rescheduled for September, will be lost outright.  Airlines will all but stop operating, limited to a small number of flights with a maximum of one passenger for every five to 10 seats.  Other large-audience in-person entertainment, from movies to festivals, will stay nonexistent.  Schools of all kinds will be closed through at least the fall.  For the rest of this year, it will take hiring efforts by the likes of Amazon to hold unemployment to about 18%. 

It may get better sooner, but don’t count on it.  If there were a viable and perfected vaccine in a laboratory right now, it would need months for confirmation, months for mass-production, then months more for distribution.  That goes similarly for the malaria drugs and other solutions about which people now hold hope.  Even those most optimistic see little chance of a vaccine, the main possibility for widespread immunity, being effectively implemented before a year from now – to others, spring 2022 or even later is a live possibility. 

For the final downer, remember that everything I have written above pertains to the United States.  The rest of the world, with 95% of the population, will have its own issues.  We read about how some countries, in Scandinavia and elsewhere, are doing quite well, but what would happen if just one infected person wandered around the packed slums of Dhaka or Kolkata?  Tens of millions would die in their countries alone, with little hope for containment.  International travel will long be problematic. 

Eventually, when we know more about the virus, our new order will set in.  Then we can get our expectations in line with reality.  They are not there now. 

Friday, March 20, 2020

Coronavirus Devastates Jobs and the Economy, and Shakes Up About Everything Else

I almost titled this post “Only One Possible Topic This Week.” 

It’s been sudden.  I read three small local newspapers here in the Catskills and Poconos, and between their coming slowly in the mail, my wife seeing them first, and my putting them on the bottom of my stack below Times Herald-Record issues and the Sunday New York Times, I often don’t get to them until two weeks after their cover dates.  One I saw yesterday was from March 5th and had not a word about our now-dominating local, national, and world situation. 

I trust you know what’s happening.  I won’t try to recap it, since as well any details or status assessment I learned and sent along to you would be obsolete before I keyed it.  I offer, instead, some general observations.

First, the Coronavirus effect on jobs, which will get worse before it gets better, is truly devastating.  The only question now is whether we are in a depression or just a stiff recession.  When Treasury Secretary Steven Mnuchin said we were, without government intervention, soon to reach 20% unemployment, he was not exaggerating.  This country contains 2.6 million waitpeople alone, almost none of whom can now do that for a living, and if you add to them others in food service, hotels, transportation (not just airlines), spectator sports, anything else connected with gatherings of people, and much more, that twenty percent seems too low.  As well, it’s hard to imagine our economy shrinking less than 10%. 

Second, while this is temporary, we have no idea when it will end.  Some may still be under the illusion that American life will be back to normal by month’s end.  It won’t, and a better question is whether, say, the Kentucky Derby will be able to stick to its new September date.  We all need to realize that we are running a marathon, not a sprint.

Third, we’ve seen other things related to this, but none quite the same.  It’s kind of like a long series of snow days or hurricane days but lasting vastly longer.  It’s reminiscent of the outpouring of patriotism we had after the 2001 terrorist attacks, with truck drivers and health care workers the heroes instead of first responders, but then we were only impeded from some travel.  It’s probably most akin to our national World War II effort, which lasted about four years and didn’t immediately end with victory, yet then we didn’t have to avoid the physical closeness which made those times more bearable. 

Fourth, because our current situation feels stultifying, isolating, and claustrophobic, we need to pay attention to our psychological and emotional health.  We need to take care of ourselves, be patient with ourselves, and give others some breaks as well. 

Fifth, we may already be on a de facto guaranteed income.  The first checks of $1,000 or more should arrive within two weeks.  Andrew Yang, the former presidential candidate known for his supporting a universal basic income, says these payments should continue monthly until “this crisis is over,” and politicians on both sides are, if not expressly agreeing, moving in that direction. 

Sixth, and for the first time in months, Donald Trump is not favored to win reelection.  The line, on which we can bet if we think it’s wrong, had him and Biden the same.  This line can change hourly, so check it for what’s probably the most objective assessment of 2020 outcomes available – it’s on the left-hand menu under Politics.

Seventh, we don’t know what will be permanently changed, but it may end up not being much at all.  People commonly thought the apparent national-character shifts from 9/11 would last, but they did not.  Two things which could remain are more knowledge of how well online gatherings and alternatives actually work and new efficiencies discovered by businesses.  In response to one article headline question, yes, we will get back to normal, though it may be pushing Christmas by then.  We can look forward to, as happened after the war, great pent-up demand for goods, services, travel, and in-person activities, which may finally be valued more highly than virtual ones.

For now, we need to physically avoid each other.  If you have any doubts about that, please read Jason S. Warner’s article here:  This may be the hardest year in our lives, but we can get through it.

Friday, March 13, 2020

Checking In On Autonomous Vehicles: Any Improvement?

It’s been months now, years really, since driverless cars got a lot of press.  There were, though, a string of small articles in the past two months. 

In “When will the highways be filled with autonomous cars?,” in the January 17th Fox Business, reporters there interviewed Intel CEO Robert Swan on the title topic, which hasn’t been gathering many encouraging views lately.  Swan was “pleasantly surprised by the amount of technology innovation that our teams have been able to deploy in cars over the course of the past couple of months,” and said that “no one really knows when that day will come.”  So no headway there. 

One promising area is bringing things to customers, exemplified in “Pizza-toting robots:  U.S. lets Nuro deploy driverless delivery vehicles (Reuters, February 6th).  Here, David Shepardson told us about a “first-of-its-kind approval by U.S. regulators,” in which company Nuro could “deploy up to 5,000 low speed electric delivery vehicles without human controls like mirrors and steering wheels.”  These “R2s” could truly be thought of as robots, as they would have neither drivers nor passengers, but would “at all times be monitored by remote human operators who can take over driving control if needed.”  The federal government helpfully ruled that “as a low-speed neighborhood vehicle,” the R2 “does not need to meet all safety requirements.”  Though Nuro’s road testing is still in the future, it seems they have a clear path to this limited objective, delivering pizzas and groceries on “pre-mapped neighborhood streets” in Houston within two years.  Per other coverage of this event, “US highway agency approves autonomous vehicle” that same day on Fox Business, these robots would stay below 25 miles per hour and allow customer access through providing an access code.  If it materializes, this would be, indirectly as well as directly, good news for driverless cars in general.

Going back to the Phoenix area, “The city of Peoria, Ariz., is piloting an autonomous shuttle program” (Times Herald-Record, February 10th).  Beep, “a Florida-based autonomous mobility solutions company,” planned to launch that 15-mile-per-hour-maximum transport, designed with an attendant onboard to help passengers but who cannot drive it as it has no pedals or steering wheel, on February 22nd, but I could find no confirmation in other press or the Beep website that that actually happened.  Beep, though, in conjunction with NAVYA is currently running a short-range shuttle in Orlando, so it has, almost uniquely, moved its services into the present.

 Another relatively live driverless possibility is the vehicle just large enough for one non-driving passenger.  Gary Gastelu described one in the February 11th Fox News “MOTIV single-seat autonomous ‘car’ is the ultimate in personal transportation.” The all-electric four-by-eight-foot device, “technically classified as a quadricycle,” can do 40 miles per hour and run for 150 minutes between charges, and would be summoned as a taxi “through an Uber-type scheme.”  The MOTIV looks like an enclosed golf cart, and won’t be here soon, as “there are currently no firm plans to put it into production.”

Overall, we have glimmers of hope in the driverless car world, but going is slow, and maintaining working examples seems to be unexpectedly hard, even when the technology is apparently fully ready.  The areas in which they can run are unusually small and are away from snow and major highways.  I will release my annual forecast in July, but now it doesn’t look good at all for anything broad-based, even later this decade. 

Friday, March 6, 2020

On the Eve of the Coronavirus Crash a Fine Month for Jobs, With Latent Demand Down 370,000 to 15.9 Million

The employment situation has faltered over the past two weeks – all we don’t know is how much.  For now, though, we have our report on how things were about three weeks ago.  Per this morning’s Bureau of Labor Statistics, we have, as a nation, little to complain about. 

The strength of February’s data started with the two marquee numbers.  We added a superb 273,000 net new nonfarm positions, which makes only a hair short of a half million for the first two 2020 months.  Seasonally adjusted unemployment dropped 0.1% to 3.5%, with the unadjusted version, showing that February is a below average month for people working, down 0.2% to 3.8%.  The number of unemployed lost 100,000 to 5.8 million, with those out for 27 weeks or longer down the same to 1.1 million.  The two measures of how common it is for Americans to be working or officially jobless, the labor force participation rate and the employment-population ratio, held and shed 0.1% respectively and are now at 63.4% and 61.1%.  Those working part-time for economic reasons, or holding on to less-hours jobs while thus far unsuccessfully seeking full-time ones, though, matched last time’s 100,000 gain to reach 4.3 million.  Average hourly private nonfarm earnings rose 8 cents per hour, about the inflation rate, to get to $28.52. 

The American Job Shortage Number or AJSN, the gauge of how many more positions could be filled if all knew that getting one was as easy as getting a pizza, fell over one third of a million, as follows:


Two-thirds of these improvements came from reduced official employment, one third from a lower count of those wanting work but not looking for the past year, and the other categories above collectively broke even.  The share of the AJSN coming from those officially jobless went down from 36.0% to 35.2%.  Compared with a year before, the AJSN is 626,000 lower, nearly all from official unemployment and those not looking for a year or more. 

So, how good was February’s data?  Considerably.  With our population up only 108,000, that 273,000 net new jobs was quite an achievement.  People are again leaving what might be called the hiding-place statuses above and rejoining the labor force.  We’ll check out the damage report in a month, but in the meantime the turtle took a substantial step forward.