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Restarting the Economy Is About Lives Versus Livelihoods – The New York Times

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President Trump signaled yesterday that he’s open to lifting restrictions soon on social distancing in an effort to get the American economy back to normal. It’s a moral trade-off between saving lives and sustaining economic livelihoods.

He has heard publicly and privately from advisers and business leaders who’ve repeated variations on the line “the cure can’t be worse than the disease,” including the former Goldman Sachs executives Lloyd Blankfein and Gary Cohn and the White House economic adviser Larry Kudlow. In announcing that he may relax social restriction guidelines, Mr. Trump said yesterday, “America will again — and soon — be open for business.”

Behind his change in thinking is fear of plunging markets and a shut-down American economy. “He is worried about the impact of soaring unemployment numbers and severe economic contraction on his 2020 re-election bid,” the WaPo reports.

Loosening restrictions after what the White House has called “15 Days to Slow the Spread” — which runs until Monday — represents a risky gamble. It’s the opposite tack of countries like Italy, France and now Britain, which last night announced a virtual lockdown that closes most businesses and restricts people’s movements. The Dutch recently extended a ban on gatherings until June 1.

• It’s also against the advice of Mr. Trump’s health experts, like Dr. Anthony Fauci of the National Institute of Allergy and Infectious Diseases. Mr. Trump is reportedly losing his patience with the outspoken Dr. Fauci, but still listens to his advice. (That said, he’s been missing from the White House’s daily briefing in recent days.)

• What remains to be seen: Whether the governors of states that have imposed strict lockdowns, including New York and California, will comply.

The central bank is pulling out all the stops, including a raft of new programs to unclog credit markets and lend directly to companies hit by the economic downturn.

The central bank is offering what looks like infinite money — officially, “the amounts needed to support smooth market functioning.” That means it will buy bonds in unlimited quantities, and not just the usual government-backed debt: For the first time, the Fed will purchase corporate bonds, including exchange-traded funds that track these bonds. It also said it would soon unveil a “Main Street Business Lending Program” to cover smaller firms that don’t tend to tap the bond markets.

• What does it all mean? The NYT’s Neil Irwin breaks down the strategy, while Ben Casselman answers common questions about how it works.

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Markets said “meh.” Although the Fed has effectively cut interest rates to zero and promised to run its money printing presses at full speed, the stock market fell yesterday. All eyes are now on Congress, as lawmakers wrangle over a stimulus bill aimed at the workers and companies that the Fed’s programs don’t address, at least not directly.

• It’s an acknowledgment that the Fed is pushing up against the limits of what it can do. Over the past week or so, it has launched so many targeted lending programs that it’s hard to keep track of all the acronyms. A non-exhaustive list: C.P.F.F., M.M.L.F., M.S.B.L.P., P.D.C.F., P.M.C.C.F., S.M.C.C.F. and T.A.L.F.

Futures markets are up today on signs of a compromise in Congress over a $2 trillion economic package. Steven Rattner, who led the 2009 auto bailout under President Barack Obama, writes in an NYT opinion piece: “Distasteful as they may be, we need rescue plans urgently, for both small and large business, and we need to apply them prudently and wisely.”

Home delivery, streaming movies, social networking, video-calling: The pandemic has deepened reliance on services provided by the world’s biggest technology firms. In a sweeping overview, the NYT’s tech team writes:

“When the economy does eventually improve, Big Tech could benefit from changes in consumer habits. And despite more than 18 months of criticism from lawmakers, regulators and competitors before the pandemic hit the United States, the biggest companies are likely to finish the year stronger than ever.”

It’s an emerging theme, with The Information detailing the end of the pre-crisis “techlash” and Medium’s Marker explaining Amazon’s “mind-boggling image makeover.”

Away from the trillion-dollar giants, no company has thrived in the stay-at-home economy more than Zoom, the videoconferencing company. The company’s shares have more than doubled this year and, as many have pointed out, Zoom is now worth more in market cap than airlines, hotels and other companies that rely on people moving around.

News that the beleaguered Japanese company will sell up to $41 billion worth of assets to buy back $18 billion worth of shares and pay down debt heartened investors. But the move raises questions about the conglomerate’s future.

SoftBank shareholders loved yesterday’s announcement, as the company’s shares closed up 19 percent in Tokyo today. Bondholders also applauded the move, with the price of some of its bonds rising as well.

• Among those pleased with the move is Elliott Management, the activist investor that had called for a buyback of up to $20 billion, Michael has learned. The hedge fund has argued that SoftBank — whose $70 billion market value is well below its roughly $250 billion sum-of-the-parts valuation — is effectively buying back shares in itself at 30 cents on the dollar.

But SoftBank will have to raise money by selling assets in a chaotic market, potentially fetching poor prices. It’s reportedly considering selling up to $15 billion worth of its $120 billion stake in Alibaba of China, and its stakes in its Japanese telecom affiliate and in Sprint in the U.S. are also on the table. One investor told Michael that the trade-off made sense, however: The buybacks will generate more value than the assets being sold, which were overdue to be offloaded anyway.

Will SoftBank now retrench? It has long been known for ambitious deal-making, especially through its Vision Fund. But yesterday’s move could be read as adopting a more defensive posture. And many of its investments are in businesses vulnerable to the coronavirus crisis, like Uber, WeWork and the Indian hospitality company Oyo.

• Striking scenes of normally bustling cities that are now all but empty are chronicled in this series by NYT photographers.

The NYT’s Opinion team created some amazing maps that track smartphone movements across the U.S.

• The CityMapper app is publishing a daily index of how much its users around the world are moving around compared with normal times: On Sunday, Milan was 3 percent of normal, New York City was 8 percent and London was 23 percent (which may explain the lockdown that the British government announced last night).

Deals

• Barclays traders reportedly made $250 million in revenue in just one day last week. (Business Insider)

• The luxury department store chain Neiman Marcus is reportedly considering filing for bankruptcy protection, again. (Bloomberg)

Tech

• Voice recognition systems from five tech giants misunderstand black users nearly twice as often as white users, according to a new research paper. (NYT)

Best of the rest

• How green should any economic stimulus package be? (Bloomberg)

• The sports goods retailer Modell halted its going-out-of-business sale because … there are no shoppers. (Bloomberg)

• Even spies have to work from home these days. (Time)

We’d love your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.

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Economy

Varcoe: With a global oil deal, Alberta's economy could finally catch a break – Calgary Herald

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Article content continued

“It buys us time. It’s not the solution,” said Schmidt.

A meeting of the G20 energy ministers, including federal Natural Resources Minister Seamus O’Regan, is scheduled for Friday. O’Regan spoke with Brouillette on Thursday and, in a Twitter post, said the two countries “will work together at the G20 to get oil prices stabilized.”

For Alberta, the prospect of an OPEC+ agreement arrives as the economic body blows keep on landing.

A new Statistics Canada report Thursday shows the country lost more than one million jobs last month as businesses shut down due to the virus.

In Alberta, more than 117,000 jobs disappeared. The unemployment rate jumped up to 8.7 per cent from 7.2 per cent in February, although the figure will likely be far higher for April.

There are many colossal problems facing Alberta’s economy today. More job losses are likely to come and many businesses may not re-open once the pandemic passes.

For realists looking across the landscape, it’s a forbidding environment.

But an end to the oil-price war is a necessary first step to rebuild a hard-hit economy.

Chris Varcoe is a Calgary Herald columnist.

cvarcoe@postmedia.com

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Quebec preparing plan to reopen economy, as COVID-19 infection rate stabilizes – CTV News Montreal

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MONTREAL —
Quebec Premier Francois Legault said Thursday health risks for younger people returning to work are limited considering almost all Quebecers who have died of COVID-19 are over the age of 60.

And if those younger workers – particularly in the province’s important construction sector – can keep away from their parents and grandparents, “then we can start to reopen,” Legault told reporters during his daily news conference.

But the premier was guarded about when that will be and which businesses outside the construction sector will be allowed to operate when the province-wide shutdown ordered in March is eased.

What is becoming increasingly clear, Legault said, is that the COVID-19 infection rate in the province is expected to peak “in the next few days.” Government projections released Tuesday estimated the peak would arrive around April 18.

“We need to ensure that is true,” Legault said, “but the numbers are holding up. It’s been a few days now.”

Legault and the province’s director of public health, Horacio Arruda, say their number one priority is to control the spread of COVID-19 in order to reduce the number of deaths.

But in recent days, they both have begun talking about a need to balance economic growth with an acceptable rate of infection.

Figures released Thursday show Quebec had the largest unemployment rate increase in Canada in March, rising by 3.6 percentage points to 8.1 per cent. Legault said hundreds of thousands of Quebecers are in financial difficulty, and Arruda added that Quebecers cannot expect to eliminate all new infections.

“We will finish by accepting a certain level of transmission in society so that (the virus) burns itself out in time,” Arruda said. “We will always evaluate the balance of risks of reopening versus the potential pandemic context.”

He said his medical team will evaluate each sector of the economy, region by region, and make recommendations to the premier. Legault said he will focus on opening businesses “where people can keep a distance of two metres.”

Legault had shut down all businesses deemed “non-essential” in March and after initially considering a reopening in mid-April, extended the order until May 4.

The premier has recently suggested that key sectors, including construction, could open sooner. Construction alone employs hundreds of thousands of people and generates annual investments in the province of around $40 billion, according to the provincial agency that oversees the industry.

Yves-Thomas Dorval, president of Quebec’s main federation of employers, said Thursday he is happy with the optimistic tone shown by the premier. Dorval said his organization, the Conseil du patronat du Quebec, will have a concrete list of proposals for the government by the end of next week on how to reopen the provincial economy.

Dorval said the business community is concerned authorities want to restart the economy sector by sector, as opposed to taking a broader approach.

All businesses that are able to protect their workers and limit the spread of COVID-19 among their customers, he said, should be able to begin operating at the same time, to avoid the most disruption.

“The government wants to go by sector, by task, by job – we won’t get out that way,” he said in an interview. “I think we can move into a context of relaunch or reopening of the economy, with general principles on public health.”

Dorval says businesses that cannot always ensure workers and clients maintain a distance of two metres should still be able to open – under certain conditions. Those include equipping employees with protective gear, limiting contact with clients and ensuring all customers maintain adequate distance between themselves, he said.

Quebec reported 41 new deaths linked to COVID-19 Thursday, bringing the total to 216 in the province. Provincial health authorities said there are 10,912 confirmed cases of the virus, with 679 hospitalizations and 196 patients in intensive care.

Nearly half the deaths have come from long-term care facilities, but Legault stressed that not all such facilities have been seriously impacted by COVID-19. Most of the deaths are tied to six long-term care centres.

Ninety per cent of those who died were 70 years old or older and another nine per cent were aged between 60 and 69 years old, Legault said.

This report by The Canadian Press was first published April 9, 2020.

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Ontario announces plans for economic recovery due to coronavirus pandemic – Global News

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The provincial government announced the “Ontario Jobs and Recovery Committee,” which will aim to help the economy recover after the COVID-19 pandemic is over.

Premier Doug Ford made the announcement alongside Minister of Finance Rod Phillips at Queen’s Park on Thursday.

The committee will focus on “getting businesses up and running and people back to work,” according to a press release.


READ MORE:
Ontario health officials unveil new testing guidelines, criteria for coronavirus

When asked if Ford could release a timeline of when people can potentially go back to work, or the province can ease restrictions, the Premier said health is the top priority but that he’s confident the economy will bounce back.

“We’re not going to wait till this is over, we’re going to get started on the economy right now and we have to see the slow of this spread and the flattening of the curve, we need to see it start going down, health is the No. 1 priority,” Ford said.

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“We can get this engine going again, not just because of the government — it’s about the people,” he continued. “You unleash businesses, you let people move forward with the ingenuity. The manufacturing might and the engineering might of the province is staggering.

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“Around the world, we’re known as an economic powerhouse and we’re going to light that fire again.”

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Included with Philips on the committee are a number of other ministers including Vic Fedeli, minister of economic development, job creation and trade, Caroline Mulroney, minister of transportation and Monte McNaughton, minister of labour, training and skills development.

“My heart goes out to those individuals and families who have been out of work, or whose business has closed through no fault of their own,” Ford said.

“I can assure each person affected by this crisis that we will do everything we can to support you, and get you back on the job as soon as possible.”

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READ MORE:
Coronavirus: How COVID-19 is spreading across Canada

The committee will be consulting with a wide variety of groups in the province, including business associations, small business owners and entrepreneurs.

“While we focus our energy and resources on defeating COVID-19, today’s job numbers highlight why we also need to plan for an economic recovery,” Phillips said. “Our first order of business is to prepare for the next phase of Ontario’s Action Plan, which will be ready to launch as soon as COVID-19 is contained.”

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On Thursday, Statistics Canada released some stark numbers in regards to the country’s unemployment, as well as Ontario’s.

According to the numbers, Ontario has seen a 402,800 decrease in employment. Overall, Canada reported a million job losses in March.


READ MORE:
Coronavirus: Canada lost 1 million jobs in March

Earlier in March, the Ford government announced the $17 billion Ontario’s Action Plan: Responding to COVID-19 which is aimed at helping all those affected by the pandemic.

“Our government is pulling out all the stops to support our job creators and workers today, during this very difficult time,” Fedeli said in a press release.

“But it is incumbent upon us to look ahead and map out a plan that considers life after COVID-19, a plan that will guide us into a future filled with hope, new employment opportunities and steady economic growth.”

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As of Thursday morning, the Ontario government said there were 5,759 cases of COVID-19 in the province. In total, 200 Ontario residents have died and 2,305 cases have been deemed resolved.

© 2020 Global News, a division of Corus Entertainment Inc.

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