We are doing well and our families are healthy. I hope everyone is staying safe and your families are doing well. I am grateful for the wonderful conversations I have had with you over the past few weeks and hearing the experiences from everyone. Every day brings new challenges but we are strong and will become stronger.
Here are a few of the key topics of conversation that we feel deserve the most attention. If you have any questions or would like to continue the conversation, let us know, and we appreciate the opportunity.
Historic Federal Action
Whether you call it a stimulus or a relief bill, the $2.2T package is of historic size to help fight the COVID-19 outbreak. To put it in perspective, total federal spending in 2019 was $4.45T, and defense spending was $676B. The bill is vast to help businesses and individuals weather the storm and is the so-called “Phase 3” action in response to the outbreak1. Much of the headlines have been focused on the direct assistance to Americans, but the largest two sections of the bill related to business and local government financial assistance and small business loans and grants. We’ve broken down the act’s spending into high-level categories below.
Jobless Claims
Yesterday’s initial jobless claims shattered records with nearly 3.3M Americans filing for initial unemployment benefits. This was a 25 standard deviation event, and more than quadrupling the previous record of 695K set in 1982, and the peak during the GFC was 665K in March 2009. In fact, you would have needed to take over a month’s worth of cumulative claims in the peak of the financial crisis to get to a figure this size. Economists and forecasters all had predicted a large number for these claims, with anecdotal evidence from state offices having reported a large surge in claims, but few had predicted numbers north of 3M. This places additional urgency on government action to help shorten the impacts of these events and something several House Representatives brought up in the debate of the CARES Act.
Please do not hesitate to reach out with questions or if you just need to talk! Kerri and I are here for you.