Unemployment DECREASED by 2.5 million!

[disneysteve]

Our hospital and I'm sure yours too has an uptick of Covid+ pts due to relaxing of restrictions.

Nope, not yet at least. Our inpatient number peaked on 5/8 at 235. Yesterday it was 105. We’ll see what happens over the next few weeks as more things reopen.

[Singuy]

I have yet to find anyone who is happy with teleconferencing as a replacement for in-person meetings. I'm quite sure the business travel will resume as soon as it possibly can. It's already starting to happen.

The epicenter of COVID is actively shifting from the US to central and south America. We've passed our peak while cases there are still rising rapidly. Numerous other countries are also in the earlier stages where we were a month or so ago.

At least in the US, the traveler quarantines are toothless recommendations. Nothing at all is being done to attempt to enforce them. I'm not sure about other countries.

Our hospital and I'm sure yours too has an uptick of Covid+ pts due to relaxing of restrictions. Compounding this with active protests and half of the republican voters think you shouldn't live in fear + masks doesn't help + virus is fake news, I have a feeling that the BEST case will be to maintain a moving average of 20k/day worth of new cases until we have a vaccine or the virus mutates to a less contagious/deadly version.

What I am saying that there will not be a V shape recovery of clients for restaurants, entertainment, or travel, at least not when we have 20k new cases per day reported from the U.S. If we were South Korea and actually near eradication of this virus through a more responsible manner of active control, maybe. However I have very little faith in our leadership as they continue to downplay the need for mask wearing and the virus itself. I am not in the camp that thinks this virus is as big of a deal as some people thinks, but I do think we are not even close at trying to reduce the number of new cases to the point where I am confident there will be a V shape recovery in the sectors I have concerns about.

[disneysteve]

Packed airline travel during the pandemic is a poor metric to use for flights going forward due to limited flights during the pandemic. In fact people had to jump through multiple hoops just to get back to their home country due to hundreds of cancelled routes. That's not a very good indicator.
Teleconferencing is taking over and that's the biggest problem with what you said, how 75% of the airline profits come from business travel. The pandemic allowed many businesses to try different things. If they found that to be a time/money saver, then there's no reason to go back to routine dealing with quarantine protocols. Don't forget, the U.S is the epicenter of Covid right now and many countries require people from the U.S to quarantine for 14 days. This is a major drag on travel for business and pleasure.

I have yet to find anyone who is happy with teleconferencing as a replacement for in-person meetings. I'm quite sure the business travel will resume as soon as it possibly can. It's already starting to happen.

The epicenter of COVID is actively shifting from the US to central and south America. We've passed our peak while cases there are still rising rapidly. Numerous other countries are also in the earlier stages where we were a month or so ago.

At least in the US, the traveler quarantines are toothless recommendations. Nothing at all is being done to attempt to enforce them. I'm not sure about other countries.

[Singuy]

Yes and no.

I think air travel is coming back. They unfortunately aren't subject to any of the state guidelines regarding masks and social distancing, which has already been evident on the packed flights that have continued to fly throughout the pandemic. The Fed would have to impose those rules and the Fed has been completely useless in dealing with COVID.

75% of airline profit comes from business travel, so the airlines don't care so much initially if you are taking a trip to the Grand Canyon or going to visit grandma. It's the business travel they want primarily, and as travel restrictions are lifted, that is coming back. I know a few people who never stopped their business travel this whole time and a few others whose jobs are already starting to make travel plans for them in the next month or two. I agree that leisure travel will be slower to recover.

Restaurants, I think, are a mixed bag. Virtually every restaurant in town has remained open for take out business. Surely, if they were able to do that, it will help them to be able to reopen the dining room even if it's only at 30% capacity to start. That's better than 0%. I do think we may see slimmed down menus with fewer options, focusing on their top sellers. That will reduce their food costs, simplify food prep, and reduce staffing needs.

I think the biggest problem with cruise ships will be ongoing travel restrictions. Canada has banned ships with more than 100 people until the end of the year. Many countries are still seeing their COVID cases rise daily. They haven't peaked yet like the US has, so they won't be opening their borders until the situation improves which could be months away. So the cruises will be limited as to where they can draw guests from and where they can sail to.

Packed airline travel during the pandemic is a poor metric to use for flights going forward due to limited flights during the pandemic. In fact people had to jump through multiple hoops just to get back to their home country due to hundreds of cancelled routes. That's not a very good indicator.
Teleconferencing is taking over and that's the biggest problem with what you said, how 75% of the airline profits come from business travel. The pandemic allowed many businesses to try different things. If they found that to be a time/money saver, then there's no reason to go back to routine dealing with quarantine protocols. Don't forget, the U.S is the epicenter of Covid right now and many countries require people from the U.S to quarantine for 14 days. This is a major drag on travel for business and pleasure.

[disneysteve]

It's not really a job gain, but a small recovery of losses.

Well, that's kind of what a job gain is. Unless you are at zero unemployment, a decrease in the unemployment numbers is a recovery of some of the losses.

Now some of the jobs gained are new. Lots of companies are and have been hiring. So this isn't just 2.5 million people all going back to their former jobs.

[disneysteve]

I am calling it now, this is an employment dead cat bounce. Travel, entertainment, and dining will not even remotely be the same as before until at least 2 years into this thing(and post vaccine). Owners will find that it'll be more expensive keeping shop open and have 25% of their usual sales than to just keep it closed, especially restaurants. Same with travel because there are fix cost to everything. Anything that has razor thin margins cannot stay afloat when it takes 80%- 90% capacity just to break even. Cruise ships are notorious for needing at least 94% occupancy to break even(hence sometimes they pretty much give away the price of the ticket just to fill the ship).

So I would look to take profit on bets like cruise ships/travel/airline/dining when there's exuberance in the air.

Yes and no.

I think air travel is coming back. They unfortunately aren't subject to any of the state guidelines regarding masks and social distancing, which has already been evident on the packed flights that have continued to fly throughout the pandemic. The Fed would have to impose those rules and the Fed has been completely useless in dealing with COVID.

75% of airline profit comes from business travel, so the airlines don't care so much initially if you are taking a trip to the Grand Canyon or going to visit grandma. It's the business travel they want primarily, and as travel restrictions are lifted, that is coming back. I know a few people who never stopped their business travel this whole time and a few others whose jobs are already starting to make travel plans for them in the next month or two. I agree that leisure travel will be slower to recover.

Restaurants, I think, are a mixed bag. Virtually every restaurant in town has remained open for take out business. Surely, if they were able to do that, it will help them to be able to reopen the dining room even if it's only at 30% capacity to start. That's better than 0%. I do think we may see slimmed down menus with fewer options, focusing on their top sellers. That will reduce their food costs, simplify food prep, and reduce staffing needs.

I think the biggest problem with cruise ships will be ongoing travel restrictions. Canada has banned ships with more than 100 people until the end of the year. Many countries are still seeing their COVID cases rise daily. They haven't peaked yet like the US has, so they won't be opening their borders until the situation improves which could be months away. So the cruises will be limited as to where they can draw guests from and where they can sail to.

[Singuy]

I am calling it now, this is an employment dead cat bounce. Travel, entertainment, and dining will not even remotely be the same as before until at least 2 years into this thing(and post vaccine). Owners will find that it'll be more expensive keeping shop open and have 25% of their usual sales than to just keep it closed, especially restaurants. Same with travel because there are fix cost to everything. Anything that has razor thin margins cannot stay afloat when it takes 80%- 90% capacity just to break even. Cruise ships are notorious for needing at least 94% occupancy to break even(hence sometimes they pretty much give away the price of the ticket just to fill the ship).

So I would look to take profit on bets like cruise ships/travel/airline/dining when there's exuberance in the air.

[~bs]

California 25% unemployed. DOW up +737 at the opening bell. There is a disconnect between Wall st & Main st.

wall street is forward looking. main street is current and backwards looking.

[~bs]

probably the effects of the ppp kicking in and all the states starting to reopen. not that surprising to me. It's not really a job gain, but a small recovery of losses.

[disneysteve]

Maybe CA should be more aggressive opening up their state. NY as well.

Or not, based on their COVID situation.

[corn18]

California 25% unemployed. DOW up +737 at the opening bell. There is a disconnect between Wall st & Main st.

Maybe CA should be more aggressive opening up their state. NY as well.

[disneysteve]

People are going back to work, but I'm hesitant to get excited, unlike the market, which seems to behaving even more irrationally than it was pre-covid. I think there's a long road ahead with subsequent waves of covid as people re-gather. A couple of fears:

-People are going back to work but their employers may find that their business doesn't return fully to pre-covid levels. Airline travel is a good example. I know I don't want to get on a plane anytime soon. Or go sit in a crowded restaurant. (I still cannot get tested, do not know if I have/had covid, there is no vaccine, and I may be part of a higher-risk group).

-Most Americans were already broke before Covid, and many are behind on rent and mortgages. It isn't fully understood yet how banks will handle this and what the ripple effect may be.

-Unemployment runs out at some point.

I'm glad people are able to go back to work and I hope the future is bright. But the realist in me says there could be some real big problems coming.

All valid concerns for sure, but as I said, there are millions of Americans who feel very differently. They aren't at all concerned, not even a tiny bit, about COVID. It is totally a non-issue to them. Just read the comments on almost any social media post and you'll see them out in full force. They barely observed self-isolation, if at all, and are resuming all normal activities as soon as they are able to. And that group probably represents about 1/3 or more of the country.

I'm with you. I'm not getting on a plane unless absolutely necessary, but clearly the demand is there based on the announcements from the airlines about their July flight schedules. I am willing to go to a restaurant as long as reasonable precautions are being taken, but I know my wife is less enthused about that so time will tell what we actually do.

[ua_guy]

People are going back to work, but I'm hesitant to get excited, unlike the market, which seems to behaving even more irrationally than it was pre-covid. I think there's a long road ahead with subsequent waves of covid as people re-gather. A couple of fears:

-People are going back to work but their employers may find that their business doesn't return fully to pre-covid levels. Airline travel is a good example. I know I don't want to get on a plane anytime soon. Or go sit in a crowded restaurant. (I still cannot get tested, do not know if I have/had covid, there is no vaccine, and I may be part of a higher-risk group).

-Most Americans were already broke before Covid, and many are behind on rent and mortgages. It isn't fully understood yet how banks will handle this and what the ripple effect may be.

-Unemployment runs out at some point.

I'm glad people are able to go back to work and I hope the future is bright. But the realist in me says there could be some real big problems coming.

[disneysteve]

Unemployment pays more than their jobs pay so I see a lot of people not wanting to return to work

If you turn down the offer to go back, you lose your unemployment benefits, so that isn't really a factor.

Universal Orlando reopened to the public today (and for select people a couple of days ago). There were plenty of people there, and Disney will have even more. They are both operating at reduced capacity to start but I guarantee they won't have any trouble filling every available spot.

Don't forget, there are still millions of Americans who think the whole COVID thing is a hoax, no different than the flu, refuse to wear masks, etc. They can't wait to go out and get back to their normal lives. As soon as places reopen, they'll be there.

[QuarterMillionMan]

Unemployment pays more than their jobs pay so I see a lot of people not wanting to return to work and why risk COVID. Car sales rising due to people not wanting to fly and also risk COVID. Las Vegas is busy but those are the hard core addicts. People with good senses know better. Disney reopening but it remains to be seen if families will feel safe enough to return. I predict only a handful will return this summer.