"If there were still hopes of a 'V-shaped' comeback from the novel coronavirus shutdown, this past week should have put an end to them. The pandemic shock, which economists once assumed would be only a temporary business interruption, appears instead to be settling into a traditional, self-perpetuating recession," David J. Lynch of the newspaper reported Saturday, citing job loses by United Airlines, Brooks Brothers filing for bankruptcy and the closure of hundreds of stores by Bed Bath and Beyond.
The report noted Jared Kushner's hopes “that by July the country’s really rocking again.”
The economic crisis could impact Trump's re-election chances.
"After two surprisingly strong months, the economy could begin shedding jobs again this month and in August, Morgan Stanley warned Friday. Many small businesses that received forgivable government loans have exhausted their funds while some larger companies are starting to thin their payrolls in preparation for a longer-than-expected downturn," The Post noted. "Fresh labor market weakness would represent a profound disappointment for millions of American workers and President Trump, who is eager to highlight economic progress with only a few months remaining before the November election."
Jim O’Sullivan, the chief U.S. macro strategist for TD Ameritrade, said he's describing the recovery as "stalling."
“But the risk there is that the numbers start turning negative again," O'Sullivan warned.
There is risk of a downward spiral.
"In a worrisome sign, more than two months after states like Georgia lifted their shelter-in-place orders, layoffs are spreading beyond companies that provide services requiring direct human contact," the report noted. "As disruption from the pandemic lingers, this could mean that the job loss is starting to feed on itself in a classic recessionary spiral, economists said."
Read the full report.
