General
How Powell and Mnuchin Became the Duo in Charge of Saving the Economy Alan Rappeport and Jeanna Smialek, The New York Times
The deal makers face their biggest challenge yet: keeping companies afloat long enough to get America past the coronavirus.
Federal officials scramble to ensure tech glitches, bureaucracy don’t delay $1,200 coronavirus checks Tony Romm, The Washington Post
U.S. officials are scrambling to stand up a new system to send coronavirus stimulus checks to millions of Americans, raising fresh fears that technical glitches and mismanagement could undermine a centerpiece of the Trump administration’s economic-recovery effort.
Bigger Unemployment Payments to Reach States This Week, Labor Secretary Says Eric Morath and Sarah Chaney, The Wall Street Journal
The federal government will this week release funds from a coronavirus stimulus package to boost jobless benefits, but how quickly those payments reach laid-off workers depends on overburdened state unemployment systems, the head of the U.S. Labor Department said in an interview.
White House Economists Warned in 2019 a Pandemic Could Devastate America Jim Tankersley, The New York Times
A study published last fall went unheeded. One of its authors now says economic shutdowns to fight the coronavirus could last up to eight months.
Stimulus May Come Too Late for U.S. Businesses Already Stretched Mike Dorning and Anita Sharpe, Bloomberg
The economic peril from the coronavirus is growing more stark every day, and the $2 trillion stimulus may not deliver a rescue in time for the many small businesses and families who lack the cash to stay afloat for more than a week or two.
Goldman Sachs slashes U.S. GDP estimate further Sinéad Carew, Reuters
Goldman Sachs said on Tuesday the second-quarter U.S. economic decline would be much greater than it had previously forecast and unemployment would be higher, citing anecdotal evidence and “sky-high jobless claims numbers” resulting from the coronavirus pandemic.
As Virus Hobbles Economy, Companies Race to Tap Credit and Raise Cash Kate Kelly and Peter Eavis, The New York Times
The clamor for corporate funding is raising concerns about a financial reckoning reminiscent of 2008.
US companies cut 27,000 jobs before the worst of the coronavirus shutdown hit, ADP report shows Jeff Cox, CNBC
Companies reduced payrolls by 27,000 in early March before the worst of the coronavirus-induced economic freeze, according to a report Wednesday from ADP and Moody’s Analytics.
Bars Crater and Grocers Boom, Showing Huge Mismatch in U.S. Jobs Leslie Patton and Katia Dmitrieva, Bloomberg
Hundreds of thousands of jobs opening up but hurdles remain.
Banking
U.S. prosecutors probe former Wells Fargo executive over scandal – sources Chris Prentice and Koh Gui Qing, Reuters
U.S. prosecutors are investigating the former head of Wells Fargo & Co’s (WFC.N) community banking division for her role in the lender’s product mis-selling scandal, two sources said. The Department of Justice is investigating Carrie Tolstedt, who ran the bank’s retail and small business lending business from 2007 to 2016, the sources said.
Banks brace for millions of small-business loan requests as Trump coronavirus plan is put to test David J. Lynch, The Washington Post
A crush of loan applications could swamp the Trump administration’s effort to speed money to cash-strapped small businesses, complicating hopes of keeping tens of millions of Americans employed during the coronavirus shutdown, according to lenders and analysts.
Supercharged Debt Bets Unravel and Expose Wall Street’s Big Risk Sally Bakewell et al., Bloomberg
For years, regulators have tried to make the financial system safer by blocking banks from taking on the extreme leverage that almost toppled the industry in 2008. Turns out, the risks just moved.
JPMorgan, addressing racism allegations, reforms customer complaint system, access Elizabeth Dilts Marshall, Reuters
JPMorgan Chase & Co (JPM.N) told employees on Tuesday it is changing its customer complaint system and how staff choose which customers are eligible for certain banking products after the New York Times reported allegations of racial discrimination against black customers at the bank last year.
Financial Products and Investments
No Coronavirus Break for Consumer Credit Scores Julie Bykowicz and Ted Mann, The Wall Street Journal
The financial industry persuaded Congress to reject a moratorium on recording missed and late payments on credit reports during the coronavirus outbreak, raising concerns that people who lose their jobs will take a lasting hit to their credit scores.
U.S. pension funds may pour $400 billion into stocks, lifting virus-hit markets: JP Morgan Lewis Krauskopf, Reuters
U.S. pension funds that delayed rebalancing their portfolios are likely to pump about $400 billion into stocks over the next two quarters, analysts at JP Morgan said, providing a potential boost to equity markets battered by the coronavirus pandemic.
Housing and GSEs
Mortgage applications to buy a home plummet 24% annually as coronavirus slams spring housing Diana Olick, CNBC
The coronavirus appears to be splitting the mortgage market: More borrowers are refinancing to save money on monthly payments, while potential homebuyers are backing away fast.
U.S. Home-Price Growth Accelerated Before Pandemic Nicole Friedman, The Wall Street Journal
Home-price growth accelerated in January, the latest indication that the U.S. housing market was poised for a strong year of sales before the coronavirus pandemic struck.
In the Coronavirus Economy, the Only Safe Mortgage Is a Government-Backed One Ben Eisen, The Wall Street Journal
The central bank’s decision to buy a nearly unlimited supply of government-backed mortgages has helped calm skittish markets and ensure that 30-year home loans remain available. But the market for loans in which the government doesn’t shoulder the risk is coming undone.
Taxes
Extended Tax Deadlines Make Balancing State Budgets Tricky Tripp Baltz, Bloomberg Tax
Pushing the tax payment deadline back to July 15 means states won’t get revenue they were counting on in the current fiscal year which, for most, ends June 30.
Financial Technology
There’s a Battle Brewing for Your $1,200 Government Relief Check Jennifer Surane and Robert Schmidt, Bloomberg
Visa Inc. and Mastercard Inc. are lobbying the Treasury Department to be included in the options the agency uses to disburse funds, as are smaller firms PayPal Holdings Inc. and Square Inc. Their argument is if the government is looking to get money quickly and safely to families across the country, it needs to get with the 21st century.
Broken Synapse: Why Employees And Customers Are Fleeing This Andreessen-Backed Fintech Startup Jeff Kauflin, Forbes
Inside the chaos at Synapse, where questionable management tactics by CEO Sankaet Pathak have left the company with its future in jeopardy.
Opinions, Editorials and Perspectives
Americans Must Be Able to Access Fintech Steve Boms, Morning Consult
Approximately two-thirds of the U.S. population currently is being urged to stay home in the face of the COVID-19 pandemic. With their mobility restricted, housebound families have turned to apps to get them through this unprecedented period.
Whom the Fed Should and Shouldn’t Rescue Bill Dudley, Bloomberg
It should help small businesses and municipalities, but draw the line at non-investment-grade corporate borrowers.
Why This Economic Crisis Differs From the Last One for Women Alisha Haridasani Gupta, The New York Times
Unlike the financial crash of 2008, this downturn will likely lead to more job losses for women, according to new research.
This Looks Like a Depression, Not a Recession Steve LeVine, Marker
Until we have a vaccine, we are barreling towards economic catastrophe.
Research Reports
Monitoring Real Activity in Real Time: The Weekly Economic Index Liberty Street Economics
How can we monitor the high-frequency evolution of the economy in “real time”? To address this challenge, we compute a Weekly Economic Index (WEI) to measure real economic activity at a weekly frequency.
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