What do Pier 1 Imports, JC Penney, Gold’s Gym, and Cinemax have in common? All are well-known businesses that have filed for bankruptcy recently—casualties of COVID-19. Not so well known are the family-owned restaurants down the street, the owners of the local gyms, and the Uber drivers. Are these canaries in the coal mine, only … Continue reading Sorting Through the Pain
What Are We Learning About the Economic Decline?
Each week we learn about the new job losses caused by the COVID crisis. Through the first part of May, the number of people who had lost their jobs and had filed for unemployment insurance had accumulated to 36 million—22 percent of the labor force. Many others have faced cutbacks in hours worked. The job … Continue reading What Are We Learning About the Economic Decline?
Socializing Risk
Over recent decades, the United States has in small steps extended the socialization of risk. We have become more responsive to those experiencing losses that threaten their livelihood. This has taken the form of growing assistance to those hit by natural disasters—tornados, earthquakes, hurricanes, and floods. It has also taken the form of coverage of … Continue reading Socializing Risk
Why is the Federal Government the One to Pay for This?
Heating up is the issue of whether the next COVID-19 bill to be considered by Congress will include massive assistance from the federal to state and local governments, especially those most strapped. If enacted, this will involve the federal government borrowing even more in the credit market to be able to achieve the transfer. Why, … Continue reading Why is the Federal Government the One to Pay for This?
Are We Drowning in Fed Liquidity?
The Federal Reserve—the Fed—is the only institution in our economy that is authorized to create money, essentially out of thin air. This can take the form of cash, those greenbacks in your wallet, or electronic credits to bank accounts. Since early March, the Fed has ramped up liquidity roughly $2-1/2 trillion—yes, trillion. This has been … Continue reading Are We Drowning in Fed Liquidity?
Job Losses
The number of people filing for unemployment insurance has soared to 26 million over recent weeks—16 percent of our labor force. For some segments of the workforce—restaurant and hotel workers — it is much higher. Still, others have had their hours cut back. For all, this has greatly compounded the anguish of coping with the … Continue reading Job Losses
Video: COVID-19 Economic Implications and Opportunities
Are you curious about the effects COVID-19 will have on our economy? UNCW Cameron School of Business professor Dr. Simpson discussed the economic implications and opportunities of COVID-19 during a UNCW Alumni Association-sponsored video event.
Today’s Crude Oil Glut
Have you heard that the price of a barrel of crude oil has fallen below $10? At the beginning of the year, it was $60. And it was not that long ago that it was above $100. Crazy! What does this mean? First off, it is telling us that supply has exceeded demand in a … Continue reading Today’s Crude Oil Glut
Is There a “V” in the Corona Virus Shock?
The Corona Virus pandemic has been a shock to the global economy, precipitating a global recession. For the United States, the news of a 3 million surge in workers filing for unemployment insurance in just one week has sent a clear message that we are not immune to the downturn. The only question remaining has to do … Continue reading Is There a “V” in the Corona Virus Shock?
Thomas D. Simpson, PH.D. 