Goldman Sachs predicts brutal second quarter as unemployment spikes above 2 million

Jonathan Shieber

Even as the Trump Administration calls for states to not release unemployment data for the month of March, Goldman Sachs on Thursday issued its own predictions on the jobs market and the broader health of the U.S. economy on Friday.

The financial services giant is predicting unemployment claims to spike to just over 2 million as a result of the massive slow down in the U.S. economy as states respond to the COVID-19 outbreak. Goldman calls it "the largest increase in initial jobless claims and the highest level on record."

Today the bank issued its broader prognosis for the health of the U.S. economy. "We now assume a peak 20% decline in the level of manufacturing output by April. This effect captures the impact of reduced domestic demand for non-food goods, reduced foreign demand for US goods, exports, supply chain disruptions and plant closures," the bank wrote.

Using corollary data from Asian countries that were hit earlier by the virus, the bank is projecting that there will be a 50% decline in broker commissions and spending on home improvement as well as a 25% decline in homebuilding and business structures throughout April.

Overall, the firm expects declines in "services consumption, manufacturing activity, and building investment to lower the level of FDP in April by 10%.

The bright side of this economic shit sandwich is that April should be the worst of it, according to the bank. "We assume that this drag then fades gradually by 10% each month. While the exact timing is highly uncertain and relapses are plausible, the assumption of a gradual recovery reflects the potential contributions from factors such as effective mitigation and testing actions, weather effects, medical breakthroughs or adaptation by firms and consumers," according to the bank.

  • World
    Sky News

    Coronavirus: Some Britons defy lockdown again - and one police officer had clearly had enough

    The vast majority of Britons were left scratching their heads after pictures once again emerged of some people ignoring the lockdown as temperatures soared. Prime Minister Boris Johnson and Health Secretary Matt Hancock were among those urging the public to stay inside despite the warm weather, reaching 21C (69.8F) on Sunday. Police patrols did their best to disperse crowds which began to gather in contravention of social distancing instructions, but the numbers of people who had decided not to comply with those instructions were significant.

  • Neighbours' Madeleine West will be playing Dee and her twin upon return
    Entertainment
    Digital Spy

    Neighbours' Madeleine West will be playing Dee and her twin upon return

    She won't be the only familiar face coming back to Erinsborough.

  • Russia and China 'exploit Covid-19 crisis' to discredit European Union – analyst
    World
    RFI

    Russia and China 'exploit Covid-19 crisis' to discredit European Union – analyst

    Italy engaged in a war of words with Russia on Friday over allegations Moscow hid spies among doctors it had sent to the country's coronavirus epicentre near Milan. The team is part of a large-scale Russian operation to assist Italy in its fight against the virus. But EU critics say Moscow has a hidden agenda. Russia strongly denies the charges.Planeloads filled with Russian aid arrived last week in northern Italy - the area that the virus hit hardest in the world - to help fighting the country's Covid-19 crisis. According to the website of the Kremlin, Italian Prime Minister Giuseppe Conti requested Russia’s help during a telephone conversation on March 21st with Russian president Vladimir Putin. According to the Russian embassy in London, the Russian defence ministry delivered 15 planeloads to Italy with 60 tons of cargo each, 122 experts, including 66 servicemen "of the radiological, chemical and biological defence troops," eight teams of doctors, and one full laboratory.But some observers in Italy are skeptical.“Probably the assistance is useful to some extent,” says Sergio Germani, director of the Gino Germani Institute for Social Sciences and Strategic Studies (GGISS), a Rome-based think tank.Intelligence activities“But there are (a lot) of Russian military officers. The concern is that they would include Russian military intelligence representatives that could take advantage of this opportunity to undertake intelligence activities.“It’s also a propaganda operation that is aimed at Italian public opinion and reinforces the idea that Italy did not get any help from the EU or from Nato allies and that only countries like China and Russia are really helping,” he says.After the arrival of the Russian military in Italy, Italy's La Stampa newspaper on April 2 quoted former Nato chemical weapons expert Hamish De Bretton-Gordon, saying that "without a doubt, there are GRU officers among them". “The objective of Moscow, and possibly of the Chinese is the weakening, and possibly the collapse, of the European Union,” says Germani, whose institute, the GGISS, studies the influence of Russian propaganda and pro-Moscow media on the internet.'Kill elderly Italians'The Russian aid operation, he says, went accompanied by a surge of pro-Russian articles, videos and tweets.According to EU vs Disinfo, a European Commission watchdog against fake news, pro-Kremlin media outlets like Sputnik news agency and internet “troll-factories” are responsible for spreading unsubstantiated rumors.In an article dated March 31st, the Latvian version of Sputnik published a story suggesting that the coronavirus was created in EU-member state Latvia “designed to kill elderly Italians.”“These are the messages they are pushing,” says Germani “ - that the EU is incapable, that it is crumbling and that the EU does not exist anymore,”“They are messages that discredit liberal democracy as a form of government that is incapable of dealing with this kind of crisis,” he says.Russia was quick to hit back at the criticism.Attacking the British press, that also reported on the article in La Stampa, the Russian embassy in London deplored that journalists are “seeking to find discrepancies and a hidden agenda in Russian humanitarian assistance rendered to ... Italy in order to help them combat the coronavirus pandemic,” stressing that “this help is free of charge and humanitarian by nature. It is a sign of our solidarity with the Italian people, not linked to any political agenda.”Europe steps up coordinationOn March 31st, EU leaders announced a concerted Roadmap" and an "Action Plan" to deal with the crisis. "The only way forward is a common strategy in a spirit of solidarity," said EU Council President Charles Michel.“The EU is beginning to respond positively to this major challenge," says Germani. "They are moving in the right direction, because they are now aware of the fact that the Kremlin is trying to exploit the emergency," he says.

  • Coronavirus: Scotland's chief medical officer forced to step back from public briefings after breaking lockdown to visit second home
    World
    The Independent

    Coronavirus: Scotland's chief medical officer forced to step back from public briefings after breaking lockdown to visit second home

    Scotland's chief medical officer Catherine Calderwood has been forced to step back from public briefings on the country’s response to coronavirus after she broke her own advice on social distancing.Police issued a warning to Ms Calderwood on Sunday after she ignored lockdown guidance designed to slow the spread of Covid-19 when she visited her second home this weekend and last.

  • Sweden prepares for possible tighter coronavirus measures as death toll climbs
    World
    The Guardian

    Sweden prepares for possible tighter coronavirus measures as death toll climbs

    Sweden prepares for possible tighter coronavirus measures as death toll climbsCountry has taken soft approach and its death rate is higher than its Nordic neighbours’ * Coronavirus – latest updates * See all our coronavirus coverage

  • World
    Sky News

    Coronavirus: Family say their 'hearts are broken' as midwife who died from COVID-19 named

    A midwife who died from COVID-19 has been named as 54-year-old Lynsay Coventry.

  • Mainland China sees rise in new coronavirus cases
    World
    Reuters

    Mainland China sees rise in new coronavirus cases

    Mainland China reported 30 new coronavirus cases on Saturday, up from 19 a day earlier as the number of cases involving travellers from abroad as well as local transmissions increased, highlighting the difficulty in stamping out the outbreak. The National Health Commission said in a statement on Sunday that 25 of the latest cases involved people who had entered from abroad, compared with 18 such cases a day earlier. The mainland has now reported a total of 81,669 cases, while the death toll has risen by three to 3,329.

  • Coronavirus: Chief medic who broke lockdown will no longer front Scotland's COVID-19 briefings
    World
    Sky News

    Coronavirus: Chief medic who broke lockdown will no longer front Scotland's COVID-19 briefings

    Scotland's chief medical officer will no longer attend press briefings after twice visiting her second home while advising the public to stay indoors. Dr Catherine Calderwood was photographed by The Scottish Sun visiting her holiday home on the east coast of the country over the weekend - and she has admitted it was the second time she had done so during the lockdown. "As well as this weekend, it's important to be clear, that I also was there last weekend with my husband," she told the Scottish government's daily coronavirus briefing on Sunday.

  • When will the UK lockdown end and what needs to happen before then?
    World
    PA Media: UK News

    When will the UK lockdown end and what needs to happen before then?

    One key Government doctor has said some measures may be in place for up to six months.