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2:00PM Water Cooler 5/26/2020


2:00PM Water Cooler 5/26/2020


By Lambert Strether of Corrente.


At reader request, I’ve added this daily chart. The data is the John Hopkins CSSE data. Here is the site.

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The vertical scale is expanded so New York’s enormous curve is cut out, but the differences between other states that otherwise are all jammed together at the bottom of the chart are now visible: Michigan, Wisonsin, Georgia, and Texas.

“The Coronavirus Is Deadliest Where Democrats Live” [New York Times]. As I have been saying for some time [lambert preens]. “The devastation, in other words, has been disproportionately felt in blue America, which helps explain why people on opposing sides of a partisan divide that has intensified in the past two decades are thinking about the virus differently. It is not just that Democrats and Republicans disagree on how to reopen businesses, schools and the country as a whole. Beyond perception, beyond ideology, there are starkly different realities for red and blue America right now. Democrats are far more likely to live in counties where the virus has ravaged the community, while Republicans are more likely to live in counties that have been relatively unscathed by the illness, though they are paying an economic price.” • An economic price they do not want to pay. Good reporting from the Times.


“But what is government itself, but the greatest of all reflections on human nature?” –James Madison, Federalist 51

“They had one weapon left and both knew it: treachery.” –Frank Herbert, Dune

“They had learned nothing, and forgotten nothing.” –Charles Maurice de Talleyrand-Périgord

* * *


Biden (D)(1): “Biden aims to move left without abandoning centrist roots” [Associated Press]. “Recent interviews and campaign events reveal the nuances Biden hopes can attract support in both directions. ‘I think health care is a right, not a privilege,’ he said on CNBC, espousing an article of faith for the left. But, he added, ‘I do not support Medicare for All’ single-payer insurance.” • “Biden aims to square circle without adding any corners.”

Biden (D)(2): “Who’s on Your Biden Dream Team?” [New York Times]. Dropdown-ism:

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I don’t see a dropdown for the color of the Oval Office drapes, though.

Biden (D)(3):

For “morally abhorrent,” see item #5 here. Interestingly, from the same article, Webb, in his campaign against George Allen, was the beneficiary of the first viral YouTube moral panic: “The Macaca Moment,” in 2006, where a Webb staffer video tracking Allen caught him using a coarse racial slur. (One does wonder if the urge to avoid a similar debacle is why the Biden campaign is keeping him wrapped up in tissue paper and carefully hidden away. Then again, there already plenty of Biden videos out there, so what difference would one more make?)

Cuomo (D)(1): “How Andrew Cuomo Screwed Democrats for Almost a Decade” [The Cuomo Files]. “Today I am not going to dwell on Cuomo’s actually disastrous response to the pandemic or his desire to gut the funding of public schools. Rather, I am writing this piece for Democrats who have recently fallen in love with Cuomo, who view him as a strong progressive bulwark against Trump. This piece is for those who’ve contributed money to Democratic candidates, volunteered for Democratic candidates, and voted in Democratic primaries. This is for those who dream of Democrats retaking the Senate, protecting the House, and ending Trump’s presidency. Here’s the crux of it all: for nearly decade, Andrew Cuomo directly helped Republicans hold power in New York State. For those who follow New York politics closely, what I am about to write isn’t terribly surprising or new. But there are many people who have busy lives and can’t possibly know the intricacies and oddities of 2010s New York. For them, I hope this is all useful.” • So you’re saying Cuomo is perfect?

* * *

“The general election scenario that Democrats are dreading” [Politico]. “Instead of forecasting a prolonged Depression-level economic catastrophe, [Jason] Furman laid out a detailed case for why the months preceding the November election could offer Trump the chance to brag — truthfully — about the most explosive monthly employment numbers and gross domestic product growth ever. Since the Zoom call, Furman has been making the same case to anyone who will listen, especially the close-knit network of Democratic wonks who have traversed the Clinton and Obama administrations together, including top members of the Biden campaign…. Furman’s argument is not that different from the one made by White House economic advisers and Trump, who have predicted an explosive third quarter, and senior adviser Jared Kushner, who said in late April that “the hope is that by July the country’s really rocking again.” White House officials were thrilled to hear that some of their views have been endorsed by prominent Democrats.” • So, a V-shaped recession? Something we should all be praying for, if we’re all in this together…. .

Stats Watch

At reader request, I added some business stats back in. Please give Econintersect click-throughs; they’re a good, old-school blog that covers more than stats. If anybody knows of other aggregators, please contact me at the email address below.

Leading Indicators: “May 2020 Chemical Activity Barometer Again Declines And Consistent With A Recession” [Econintersect]. “The Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), fell 5.4 percent in May on a three-month moving average (3MMA) basis following a 5.4 percent decline in April. On a year-over-year (Y/Y) basis, the barometer fell 12.4 percent in May.”

Manufacturing: “May 2020 Texas Manufacturing Improves But Remains Deep In Contraction” [Econintersect]. “Important subindices new orders improved (remains deep in contraction) and unfilled orders also improved (remains deep in contraction). This should be considered a better report relative to last month. No question that industrial production is contracting this month.”

Consumer Confidence: “May 2020 Conference Board Consumer Confidence Stabilizes” [Econintersect]. “The latest Conference Board Consumer Confidence Index’s headline number held steady, following March’s and April’s record decline…. A quote from the Conference Board: “Consumers remain concerned about their financial prospects”…. Consumer confidence had been on a multi-year upswing, the upswing paused in 2019 – but the coronavirus killed the upswing.”

Housing: “April 2020 Headline New Home Sales Exceed Expectations” [Econintersect]. “This month the backward revisions were down. Because of weather and other factors, the rolling averages are the way to view this series. The rolling averages declined. Sales did not crash this month demonstrating the resilience of the new home market.”

Housing: “S and P CoreLogic Case-Shiller 20 City Home Price Index March 2020 Year-over-Year Growth Not Effected By Coronavirus” [Econintersect]. “All home price indices are continuing to show home price growth is accelerating year-over-year. It is interesting that the coronavirus had little effect on home prices.” • “Interesting.”

* * *

Shipping: “The traditional battle lines over state subsidies in shipping are shifting under the coronavirus-driven economic downturn. Some of the world’s biggest shipping companies are turning to government support to ride out the big drop in global trade…. with executives saying some operators won’t make it unless vessel owners are bailed out” [Wall Street Journal]. “French container line CMA CGM SA is joining those seeking state backing with a $1.12 billion syndicated loan from three banks which is 70% guaranteed by the French government. It’s an example of how the crisis is scrambling the usual shipping world debates over state support that has often flowed toward Asian carriers. Germany is already moving to bolster other critical transportation operations.”

Supply Chain: “General Motors Co.’s ambitious plans to ramp up production of its high-profit pickup trucks is bumping up against supply-chain reality. The auto maker is facing a shortage of parts from Mexico because of separate timelines for reopening U.S. and Mexican plants. … [T]he disconnect underscores the challenges the auto industry faces in restarting after a two-month shutdown under the pandemic. Mexico has been slower than the U.S. to reopen factories, with operations rebooting only gradually, and the slow flow of parts along with scant information has frustrated American importers” [Wall Street Journal]. “GM has delayed plans to roughly double output at its main U.S. pickup-truck factories because of the parts backup. Detroit auto makers derive much of their profit from those vehicles, and resuming the production is especially important to GM since its inventories were depleted by a labor walkout last fall.” • Hmm. Swing state issues?

Mr. Market: “Dow soars 650 points on recovery hopes and vaccine news” [MarketWatch]. “The Dow Jones Industrial Average climbed 664 points, or 2.7%, to 25,130, while the S&P 500 index rose 59 points, or 2%, to 3,015, while the Nasdaq Composite gained 110 points, or 1.2%, to 9,434.”

Fodder for the Bulls: “From truck shipments to travel bookings, there are early signs that the U.S. economy is slowly creeping back to life. Projections still show the economy contracting 6% to 7% this year, but …. it appears conditions in some corners aren’t getting worse for the first time since the pandemic forced widespread U.S. business closures in March and that some business might even be improving” [Wall Street Journal]. “The signs are particularly crucial in transportation sectors since operations from freight loads on trucks to passengers traveling through airports were hit hard as pandemic lockdowns roiled demand. Recent measures show trucking demand is edging upward and intermodal rail volumes even rose sequentially for the first time in eight weeks. Gregory Daco of Oxford Economics says data suggest the U.S. economy is “past the trough” but cautions that gains are coming “from extremely depressed levels.”

* * *

Today’s Fear & Greed Index: 51 Neutral (previous close: 50 Neutral;) [CNN]. One week ago: 48 (Neutral). (0 is Extreme Fear; 100 is Extreme Greed). Last updated May 26 at 1:10pm.

The Biosphere

“Managing soil borne pathogens” [John Kempf]. “For soil-borne pathogens, there is no correlation between the presence of the organism in the soil and the expression of the disease in the crop. Infections severe enough to produce crop loss are correlated with the absence of suppressive organisms more than the presence of the pathogen.” • Hmm. Readers?

She’s not the only one:

Nice greenhouse. (I decided a greenhouse was more serious than I wanted to be.)

Health Care

“New Research Shows Electroceutical Fabric Eradicates Coronavirus Infectivity On Contact” [Forbes]. “Last month, a team of researchers determined a hybrid combination of one layer of cotton and two layers of chiffon is the most effective fabric for a face mask. They noted the high-efficiency of the combination is likely due to the combined effect of mechanical and electrostatic filtration of infective particles. The new study from IU further explores the potential of electrostatic forces to act against Covid-19….. Knowing viruses rely on electrostatic forces to assemble and attach to cells, the researchers suspected the electroceutical fabric could be used to destabilize the coronavirus as well… Their subsequent analysis revealed that just one minute of contact to the electroceutical fabric led to significant reduction in the electrokinetic property of the viral particles.” • Pretty neat! *(If true, of course.)

“You’re Getting Used to Masks. Will You Wear a Face Shield?” [New York Times]. “”The nice thing about face shields is that they can be resterilized and cleaned by the user, so they’re reusable indefinitely until some component breaks or cracks,” Dr. Yu [of Brigham and Women’s Hospita said]. A simple alcohol wipe or rinse with soap and hot water is all it takes for the shields to be contaminant-free again…. Dr. Perencevich believes that face shields should be the preferred personal protective equipment of everyone for the same reason health care workers use them. They protect the entire face, including the eyes, and prevent people from touching their faces or inadvertently exposing themselves to the coronavirus. Face shields may be easier to wear than masks, he said, comparing them with wearing glasses or a hat. They wrap around a small portion of a person’s forehead rather than covering more than half their face with material that can create the urge to itch.” • Shields might also be easier to breathe with; I don’t really like my masks for that reason. However, I wish it were possible to invent a way to protect the shield edges, so droplets don’t come around them. Perhaps tiny fans. Or something charged. Still, as with the link above, it’s fascinating and hopeful to see all the “innovation” being done on something more than apps designed to screw the last nickel out of precarious gig workers.

Black Injustice Tipping Point

“Video shows officer kneeling on neck of black man who died” [Associated Press]. “A black man [George Floyd] who died in police custody in Minneapolis was seen on a bystander’s video pleading that he could not breathe as a white officer knelt on his neck during the arrest and kept his knee there for several minutes after the man stopped moving. The death Monday night after a struggle with officers was under investigation by the FBI and state law enforcement authorities.” • This keeps happening. Klobuchar statement:

Groves of Academe

“University Leaders Are Failing” [Chronicle of Higher Education]. “My university, Johns Hopkins, recently announced a series of exceptional measures in the face of a coronavirus-related fiscal crisis. Suddenly anticipating losses of over $350 million in the next 15 months, the university imposed a hiring freeze, canceled all raises, and warned about impending furloughs and layoffs. Most extraordinarily of all, it suspended contributions to its employees’ retirement accounts. ‘Many of our peers are grappling with similar challenges,’ wrote our president, Ronald Daniels…. How does a university with a $6-billion endowment and $10 billion in assets suddenly find itself in a solvency crisis? How is one of the country’s top research universities reduced, just a month after moving classes online, to freezing its employees’ retirement accounts?… Meanwhile, what plans did the university’s senior leadership have for a financial crisis? We now learn that the university was operating on the thinnest of margins, its finances exquisitely vulnerable to disruptions at the hospital. With the cancellation of lucrative elective procedures, huge losses appear inevitable. No one, it seems, thought to prepare for such a financial disruption — even though all that pandemic planning took place within the halls of Johns Hopkins itself. The last financial crisis happened just 12 years ago. Did the university’s leadership believe another would never come? Then there are the losses in federal grant money and foreign tuition revenues. Did anyone think to prepare in the event these were disrupted? The university set virtually nothing aside in anticipation of these or any other risks. Instead, the leadership began recklessly expensive building projects, including the purchase of a $372.5-million building in Washington, D.C., — a white elephant that had already brought a large foundation to the brink of collapse.” • The first thing we do, let’s kill all the college administrators. Starting from the top down.

Guillotine Watch

“What About the Rotten Culture of the Rich?” [Chris Arnade, American Compass]. “Why isn’t it considered bad behavior to sit in front of a wall of screens filled with flashing numbers making bets on those numbers? Would it attract the cultural scolds if the people making those bets where drinking tall boys in brown bags, rather than sipping bespoke lattes? Why isn’t it considered bad behavior to find a mid sized company, load it up with debt, strip it of its valuable assets, and send jobs overseas to the country with the lowest labor cost and least environmental regulations. All to make yourself rich, while leaving an economic hole in a Michigan town, or a New York town. A hole that sucks out hope, and eventually fills with despair and drugs…. The lesson is that cleverness trumps hard work. That a disregard for the rules trumps playing it straight. That you are a fool to put your head down every day, play by the rules, and focus on a job that values your community and your family. Why toil away at growing food, or building roads, or building bridges, when you can get rich quick by sitting in front of a wall of computers betting on flashing numbers? Why diligently work your way up the corporate ladder when you can smooth talk enough people into lending you enough money to take over the corporation, fire the board, leverage it up with debt, and then dismantle it while pocketing a few billion…. .I hope if we do talk about our broken culture, we talk about the destructive individualism of elites that has led to a selfishness that cares more about profits than the national or community good.” • Sounds like they’re not studying the Impressionists on Wall Street either….

“Elon Musk Is the Hero America Deserves” (interview) [Bloomberg]. From Musk’s biographer: “The only reason NASA entertained the idea of putting astronauts in a rocket built entirely by a private company is that SpaceX has proven itself a remarkably dependable, relatively low-price, competently managed operation. Over the past decade, it’s launched about 100 rockets, landed many of them safely back on Earth, and come to dominate the industry, while being valued at close to $40 billion. It took the effort of many clever, hardworking people to pull this off, but it’s Elon Musk in all his audacious, volatile glory that made such a thing possible in the first place.” • With most of the engineering already done at government expense…

News of the Wired

So I guess we can kiss Game of Thrones goodbye, then?

Who wants to be writing, when they can can be playing with life-size toy trains?

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Readers, feel free to contact me at lambert [UNDERSCORE] strether [DOT] corrente [AT] yahoo [DOT] com, with (a) links, and even better (b) sources I should curate regularly, (c) how to send me a check if you are allergic to PayPal, and (d) to find out how to send me images of plants. Vegetables are fine! Fungi and coral are deemed to be honorary plants! If you want your handle to appear as a credit, please place it at the start of your mail in parentheses: (thus). Otherwise, I will anonymize by using your initials. See the previous Water Cooler (with plant)
here. Today’s plant (skookum red):

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skookum red writes: This is the first early bloom of my Star Magnolia growing next to my driveway. I must always park carefully so I don’t mangle the Magnolia when I open the driver’s side door. This is my reward for my carefulness.”

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