America: We'll send citizens cash checks amid coronavirus financial hardship. UK: We'll offer £330bn in biz loans The Trump Administration wants to give cash payments to every American adult within the next two weeks to help those who have lost their jobs or otherwise hit hard times during the global coronavirus pandemic. Folks around the world are advised, or required, to stay and work at home to prevent the spread of the bio-nasty, …
Not quite. It goes into the national debt and is covered by a treasury bond sale. The buyer is the treasury itself so it's like a self eating watermelon or "qualitative easing" depending on how you like to spin it.
As the economy improves, the bond is paid back to the treasury or sold off to the market.
Trump has already proved he can bankrupt his own worthless ass multiple times over, so it should come as no surprise he'll do the same thing to this nation he's flushing down the bog.
He'll probably declare the new American currency to be the leaves off trees to make everyone rich, but then the going rate for a sandwich will be something like three major dessiduous forrests per slice of bread.
We need a B Ark to pack him, the Republicans, & anti vaxers into so we can aim it into a blackhole.
The problem is that this is a supply side crisis, people are not working and producing.
As a measure to prevent too many bankruptcies it may work, at the price of inflation later. OK I think.
The big question is when things start returning to normality again.
We are looking at potentially a lost year in our tourism business. If we can delay paying tax, laying staff off etc we should make it, not everybody is that well financed.
Exactly. Giving the people a grand won't help them in the long run.
You need to keep the businesses in place that pay them a regular salary. Once the grand has gone, the people will be in the same position they were in before. What are they supposed to do in April? In May? In June?
Keeping the business that is paying them alive makes more sense.
Germany has set aside half a billion Euros (500 US short scale billion Euros) to support businesses. They will provide "short working time" payments to employees, who are forced to work fewer hours or for businesses that have to close their doors completely.
Those businesses will come out the other side with a debt to the government, but they will still, hopefully, be in business.
Giving a $Tn in tax cuts to billionaires helped boost the economy to it's current state to giving away $1000 to 200Million adults will only have 20% of the effect.
Could we give away another $Tn to hedge fund managers? Can we ask more of them or have they done enough ?
We are looking at potentially a lost year in our tourism business. If we can delay paying tax, laying staff off etc we should make it, not everybody is that well financed.
Tourism will boom next summer subject to everyone being vaccinated. The problems come in how to get from here to there without killing the industry and as few people as possible. Same for pubs, clubs, hotels, festivals, gigs, galleries, theaters, cinemas etc. People will go out and go nuts once this passes.
As I see it the problem is that we're going to hit a phase of massed redundancies, almost no matter what the state does. All countries will get hit with it despite taking different action. Of course there's also the fact that people are only ever 3 meals from rioting thing, and with the shop shelves emptying, it may be worth remembering that they aren't preparing to deploy the military for shits & giggles.
Things will get worse before they get better, a lot worse. Bankruptcies may not be our most pressing problem 6 weeks from now.
"We are looking at potentially a lost year in our tourism business. If we can delay paying tax, laying staff off etc we should make it, not everybody is that well financed."
The problem is much of business and industry is living off credit and loans so a stalled income means no money to service the loans. Small businesses rarely have any slack in their finances, and tourism especially is often running at a loss over the winter months, banking on the summer income. This year, there will be little to no summer tourism income.
"Traditionally, in America, the Republicans spend the economy into a decline while making corporations richer and are then defeated in the next election. The Democrats then take over and restore the economy by taxing the wealthy. The Republicans then win the next election and spend again."
Isn't that the truth. Trump's tax cuts, mostly greatly benefiting corporations and the top 1%, are expected to cost $2.3 trillion over the next decade and are heralded as a great accomplishment.
Now, they propose a direct cash payment to earners, with a $75,000 income cap, expected to cost maybe $2 trillion.
Proposed End of the World as we know it.
In case you missed it
https://i.redd.it/vseh8hakp8y21.jpg
You can be working and claim UC, thats why there is a Minimum Income Floor (what you would earn working full time for minimum wage / average wage in your sector),which screws the self employed (particularly disabled self employed) and justified to avoid "propping up unsustainable small businesses" said with a straight face by an MP whose family run farms that are financially unsustainable without large cash handouts from various levels of govt, yet no issue shoring them up......
And, of course, the UK already has a benefits and statutory sickness system.
Yup, and because so many people work and claim something, they're already enrolled on the one universal system, meaning moving them to a different range of benefits can be done online rather than in a job center, which are running out of staff (not "key workers" you see).
Under the old pre-UC system, the state would have a real problem getting money to new claimants because you'd be a new claimant whenever your benefits changed. UC in that sense, is a blistering success.
I get their point, their cops are overstretched worse than ours on a good day, plus they are spread further apart, a police response can be measured in several hours even for a critical 911 call due to distance.
Also when you reckon those who might want to take your stuff are armed and the cops won't come, then many come to the conclusion that having a weapon might be a good idea, however forgetting "don't pull a weapon or point it at someone unless your going to use / shoot someone with it" problem is many can't mentally bring themselves to use it, on the other hand someone comes through my back door 1 - they have the dog to contend with, 2) I have enough tools in the house to not go down without a fight....
"Are we really still calling it coronavirus or COVID-19?"
The virus is SARS-CoV-2, the disease is COVID-19. This sounds weird, until you think that this is normally the case that the disease is not the same name as the virus. So SARS-CoV-2 is to HIV as COVID-19 is to AIDS, roughly speaking.
It makes even more sense when you realise where most of this money will end up.
Travel, socialising, and spending on luxuries is way down, so it's the repeating fixed costs that people still use the most money to pay for - rent, mortgages, loan repayments, etc. At this stage, the majority of any handout is effectively going to banks and wealthy land-owners.
But would any government dare mandate that all interest and loan payments should be suspended for the period of the emergency? Imagine the fury of their banking chums!
Why should you need to apply? Minimum overheads and outgoings?
I've been contracting for 20 years, and I've always kept to the rule to "keep 6 months money in the bank". Any IT specific contractors that haven't abided by that really need to take a long hard look at themselves.
A/ I was pointing out Opportunity. An additional capacity/capability. I was NOT seeking to imply that contractors all desperately need a large sum of cash or else catastrophe.
B/ Having said that, this opportunity is transient so I would think if the terms are near-0 then it only makes sense to avail oneself of this free money. If you're cash-blocked on a particular asset you need, then you can get it. Or clear a high-cost debt (AKA re-financing). Or, if you're just in normal-town, then to invest somewhere (eg in UK: an ISA) -- you then, for free, earn the difference between the investment and the near-0 funding cost. Government-guaranteed too, so will not affect your credit rating or access to future credit eg mortgage.
(My trading&fundsmgt background is showing :)
So you owe a million bucks in tax, but you don't have enough cash for groceries? Seems unlikely, somehow,
The individuals who need help here are surely those on much lower incomes, whose immediate tax liabilities are predicated on an income next month; the ones who are really going to hurt.
Yes but they're poor, so no one gives a shit about them.
Sadly very true, at least as far as most of our rulers are concerned. "Many men of course became extremely rich, but this was perfectly natural and nothing to be ashamed of because no one was really poor – at least no one worth speaking of.”
Where should the IRS/Treasury have set the upper bound to delay tax returns/payments? As it is, the range covers individual tax liabilities in USD for the range (-∞, 10^6], so those on much lower incomes are included. It's also only one part of the plan to assist people, but I agree, more can and should be done.
Germany did the same as the UK, nearly 2 weeks ago. They set aside half a billion Euros (500 US short-scale billion Euros) for businesses in hardship through the SAR-CoV-2 crisis.
There is also a package for short working hours compensation etc. for people forced to work fewer hours or who work for companies forced to close their doors completely by law.
Insurance companies are complete twats, and will look for every possible way to avoid paying out on a claim.
I know from experience that even though they claim all calls are recorded, that conveniently those calls will go missing or will be inaudible when you challenge them about something in a claim you know you mentioned when you took out the policy and they say you didn't mention.
Had to take it to the ombudsmen to deal with it in the end.
I would say "mobile check deposit" (via smartphone app for banks/credit unions) but my particular one has a $500 limit.
I'd at least have to drop mine and the missus' off at the ATM and wait an extra day for processing. I'd be as isolated as usual in my car.
A few years ago I lent a relative a not insubstantial amount of money because they had kids and begged for help as they apparently had no money to put food on the table.
Went round two weeks later and they had a brand new TV. Not spoken to them since and probably won't.
Effectively nowhere if they're lucky. It's £330Bn of guarantees, i.e. if your company takes out a loan to cover it through the pandemic it's backed by the government so if you still go out of business it gets paid off. If you don't go out of business you pay it off not the UK taxpayer.
Essentially they're printing it. It may well lead to inflation somewhere down the line.
Call it making the best of a bad job or needs must when the devil drives or whatever. It's something that has to be done and when it's in response to an external problem there's justification. A decade ago it was a response to a problem of HMG's own making by a long run of infeasibly low interest rates (basing inflation rates on a measure that disregarded the house price bubble); that wasn't justifiable.
Listened to one businessman on the radio this morning saying that the business loans (he was a larger business) would be almost useless. Basically if his wages bill is £100,00 per month and this lasts for three months then at the end he will have a loan of £300.000 to pay off. Better of putting his employees on unpaid leave, or sacking them than incurring a huge loan. After all for those 3 months he would not be earning much money (he was a Retailer).
Exactly so. Adding extra debt to the balance sheet isn't even a serious consideration. Deferrals and holidays from some fixed costs are useful but insufficient. You 'freeze' a company so it has no net income and expect its staff costs to be paid? Sorry you're living in la-la-land.
I'm about as far from a socialist as one can get and I see that wage bill has to be covered. Refunds of all salaries paid with PAYE is easy to calculate, the sticky points are the large numbers of self-employed and people in the cash economy generally. My knee jerk solution... give everyone a debit card, limit it to certain categories of spending (food, utilities, debt repayments, mortgages, rent) and credit the card with either 75% of the PAYE salary or 100% of the living wage (whichever is higher) for everyone else.
1. The one-time payment will be bandied about, probably for weeks
2. The foot dragging will allow the Republicans to blame the Democrats, and the Democrats to blame the Republicans.
3. It will be approved, grudgingly, then trumpeted by both sides as a great win.
4. The paltry payment will vanish like spilled water in a desert into keeping utilities on and rent paid, for the briefest moment
5. It will be taxable income at the end of the year, surprising people, BUT, after the election in November.
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