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Jason Furman, who was one of Obama’s top economists gave the presentation in early April. At the time the economy had just been completely shut down and unemployment claims were skyrocketing, it looked like the country was about to collapse.
The audience was full of top officials from both parties including former cabinet secretaries and Federal Reserve chairs when Furman said, “We are about to see the best economic data we’ve seen in the history of this country.”
The premise explained that the 2020 pandemic-triggered economic collapse is categorically different than the Great Depression or the Great Recession, which both had slow, grinding recoveries.
Instead, he believes, the way to think about the current economic drop-off, at least in the first two phases, is more like what happens to a thriving economy during and after a natural disaster: a quick and steep decline in economic activity followed by a quick and steep rebound.
The Covid-19 recession started with a sudden shuttering of many businesses, a nationwide decline in consumption and massive increase in unemployment. But starting around April 15, when economic reopening started to spread but the overall numbers still looked grim, Furman noticed some data that pointed to the kind of recovery that economists often see after a hurricane or industrywide catastrophe like the Gulf of Mexico oil spill.
Consumption and hiring started to tick up “in gross terms, not in net terms,” Furman said, describing the phenomenon as a “partial rebound.” The bounce back “can be very very fast, because people go back to their original job, they get called back from furlough, you put the lights back on in your business. Given how many people were furloughed and how many businesses were closed you can get a big jump out of that. It will look like a V.”
Smart Money
Tuesday
Dow +529.95
Nasdaq +15.63
S&P +23.12
Wednesday
DOW +553.16
Nasdaq +72.14
S&P 44.36
Last edited: 12 minutes ago
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Jason Furman, who was one of Obama’s top economists gave the presentation in early April. At the time the economy had just been completely shut down and unemployment claims were skyrocketing, it looked like the country was about to collapse.
The audience was full of top officials from both parties including former cabinet secretaries and Federal Reserve chairs when Furman said, “We are about to see the best economic data we’ve seen in the history of this country.”
The premise explained that the 2020 pandemic-triggered economic collapse is categorically different than the Great Depression or the Great Recession, which both had slow, grinding recoveries.
Instead, he believes, the way to think about the current economic drop-off, at least in the first two phases, is more like what happens to a thriving economy during and after a natural disaster: a quick and steep decline in economic activity followed by a quick and steep rebound.
The Covid-19 recession started with a sudden shuttering of many businesses, a nationwide decline in consumption and massive increase in unemployment. But starting around April 15, when economic reopening started to spread but the overall numbers still looked grim, Furman noticed some data that pointed to the kind of recovery that economists often see after a hurricane or industrywide catastrophe like the Gulf of Mexico oil spill.
Consumption and hiring started to tick up “in gross terms, not in net terms,” Furman said, describing the phenomenon as a “partial rebound.” The bounce back “can be very very fast, because people go back to their original job, they get called back from furlough, you put the lights back on in your business. Given how many people were furloughed and how many businesses were closed you can get a big jump out of that. It will look like a V.”
Smart Money
Tuesday
Dow +529.95
Nasdaq +15.63
S&P +23.12
Wednesday
DOW +553.16
Nasdaq +72.14
S&P 44.36
Last edited: 12 minutes ago
Quote Reply
Report Edit Del
