March 20 (UPI) — The city of Miami Beach declared a state of emergency Saturday over concern about spring break crowds spreading COVID-19 Saturday and the Idaho legislature moved to a recess due to an outbreak among lawmakers. Miami Beach Mayor Dan Gelber announced an 8 p.m. curfew for the South Beach entertainment district during a Saturday-afternoon news conference and said shore-bound traffic on the city’s causeways would be shuttered. Both measures will be in effect for at least 72 hours, but officials may extend the state of emergency. “As we hit the peak of the peak of spring break, we are quite simply overwhelmed,” City Manager Raul Aguila said, who also said that on Friday night “you couldn’t see pavement and you couldn’t see grass” due to crowding in the area.
Fed Will Need to Buy Bonds as Stimulus Boosts Yields, Dalio Says
The U.S. Federal Reserve will need to buy more bonds as an oversupply of Treasuries drives up yields, said Ray Dalio, founder of Bridgewater Associates. The recent fiscal stimulus announced by the Biden administration will result in more bond sales to finance the spending, worsening the “supply-demand problem for the bonds, which will exert upward pressure on rates,” Dalio said Saturday on a panel at the China Development Forum, an annual conference hosted by the Chinese government. That will “prompt the Federal Reserve to have to buy more, which will exhibit downward pressure on the dollar,” he said.
Pelosi Kicks Off Infrastructure Debate, Teases ‘Big, Bold, and Transformational’ Package
House Speaker Nancy Pelosi (D-Calif.) said Friday she has directed key Democratic lawmakers to work with Republicans on drafting the next big legislative push from Congress—the much-anticipated infrastructure package. Pelosi said it would be “big, bold, and transformational” but it is also drawing scrutiny on how it will be paid for. Pelosi made the announcement in a statement infused with hope for bipartisanship, which fell short in the American Rescue Plan. Democrats passed the $1.9 trillion package along strictly partisan lines, with Republicans denouncing it as a “liberal wish-list” that was packed with non-pandemic related spending. “Building our transportation system has long been bipartisan,” Pelosi said. “It is our hope that spirit will prevail as we address other critical needs in energy and broadband, education and housing, water systems and other priorities.” Fresh off the American Rescue Plan clearing the Senate through a budget reconciliation process that let Democrats avoid having to get any Republican buy-in, Democrats are anxious to get some members of the GOP on board, both to satisfy optics and to avoid taking the drastic step of removing the filibuster.
A big question mark remains in how to pay for the massive boost in spending that the infrastructure package—which Pelosi called “bid, bold and transformational”—would surely entail. Concerns about the topline cost and competing visions for how to raise the money have prevented Congress from approving a big infrastructure package for more than a decade.
So far, Democrats have been careful to avoid putting a price tag on the initiative, which is rumored to be worth at least $2 trillion. Rep. John Garamendi (D-Calif.), in an interview with the Sacramento Bee, said that Biden is considering raising taxes as a way to pay for the infrastructure plan—including an excise tax on fuel, some form of a user fee for electric vehicles on highways, and a carbon tax. Garamendi did not provide specifics on taxes, nor on the overall cost of the package. “No price tag right now, because we’re going at this from the bottom up,” Garamendi told the outlet. “We’ll say, ‘what’s the cost of broadband, what’s the cost of repairing bridges?’ and go from there.” Pelosi, in her Friday statement, said she hoped the measures will address transportation as well as “other critical needs in energy and broadband, education and housing, water systems, and other priorities.” During his presidential campaign, Biden pledged to invest $2 trillion in fixing highways, bridges, and airports; building climate-resilient homes; wiring cities for broadband internet; and encouraging the manufacturing of fuel-efficient cars and installing electric vehicle charging stations.
Money flows into U.S. equity funds climb to a five-week high: Lipper
March 19 (Reuters) – Investment flows into U.S. equity funds jumped to a five-week high in the week ended March 17, buoyed by optimism over a massive stimulus package and on expectations that the Federal Reserve’s monetary policy stance would remain dovish.
U.S. equity mutual funds pocketed a net inflow of $20.1 billion in the week, which marked a sixth straight week of net buying, data from Refinitiv Lipper showed.
The inflows were led by U.S. small cap funds and mid-cap funds, seeing net purchases of $3.6 billion and $2.1 billion respectively. On the other hand, large-cap funds had an inflow of just $251 million. Among sector funds, investors turned net buyers of tech funds this week, purchasing $832 million, as tech stocks appeared attractive at lower valuations after witnessing sharp selling in the prior weeks. Investors were sanguine ahead of a two-day Fed policy meeting at which the central bank signalled its intent to keep rates near zero until at least 2024, also predicting a fast economic recovery from the pandemic. However, U.S. stocks tumbled on Friday, with banks leading the way after the Fed let expire a temporary capital buffer relief put in place to ease a pandemic-driven stress in the funding mark. Meanwhile, investors bought $9.72 billion in U.S. bond funds in the week, compared with $1.32 billion in the preceding week. U.S. Taxable bond funds had an inflow of $7.9 billion, while U.S. municipal funds saw an inflow of $9.3 billion. Investors turned net buyers of U.S. High yield funds, buying $260 million, after dumping $5.5. billion in the last week.
US economic recovery far from complete – Powell
Washington — The coronavirus pandemic inflicted a “cruel and uneven toll on lives and livelihoods” across the United States, head of the Federal Reserve Jerome Powell (pictured) told the Wall Street Journal on Friday. The official stated that the central bank and the government acted together to limit the long-term effects of the “unprecedented” downturn, with more than half of the initial job losses being recovered. The arrival of COVID-19 vaccines has also helped “brighten” the economic outlook, he added.
“But the recovery is far from complete, so at the Fed we will continue to provide the economy with the support that it needs for as long as it takes,” Powell concluded.
“The economic recovery remains uneven and far from complete, and the path ahead is highly uncertain,” Powell said in written testimony to the Senate Banking Committee. Powell’s comments are in contrast to the increasing optimism among many analysts that the economy will grow rapidly later this year. That outlook has also raised concerns about a potential surge in inflation and fueled a sharp increase in longer-term interest rates this year. Many economists say they think the Fed’s continued low rates, further government financial aid and progress in combating the viral pandemic could create a mini-economic boom as soon as this summer. “Mr. Powell presumably wants to try to persuade markets that a strengthening economy does not necessarily mean that rates have to rise,” Ian Shepherdson, chief economist with Pantheon Macroeconomics, told investors in a note. “Good luck with that when the post-Covid surge in activity become clear.” Financial markets fell modestly in morning trade, with the S&P 500 and Dow stock indexes both down less than 1% and the tech-heavy Nasdaq down 242 points, or 1.8%.Powell acknowledged the potential for a healthier economy. But he stressed the challenges caused by the pandemic, especially for unemployed Americans.
Wall Street ends sharply lower, hit by bond yields and COVID-19 worries
(Reuters) – Wall Street ended sharply lower on Thursday, with the Nasdaq tumbling 3%, hit by rising Treasury yields and fresh worries about the coronavirus pandemic in Europe. Losses in U.S. stocks accelerated after France’s prime minister imposed a month-long lockdown on Paris and several other regions due to the health crisis. It was the Nasdaq’s steepest one-day drop since Feb. 25. The S&P 500 energy sector index tumbled 4.7% as oil prices fell, in part due to worries about rising COVID-19 cases in Europe. “That last hit was from news of the Paris lockdown. It wasn’t received that well,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey. “Here in the United States, we anticipate this big reopening and the virus is looking good, but we are not looking outside of the U.S., and it’s not all good.” The Russell 1000 value index, which is heavily comprised of cyclical stocks such as financials and energy, lost 0.6%, while the Russell 1000 growth index, which includes technology stocks, dropped more than 2%. The yield on the benchmark 10-year Treasuries crossed 1.75% to hit a 14-month high a day after the Fed projected the strongest growth in nearly 40 years as the COVID-19 crisis winds down. The Fed also repeated its pledge to keep its target interest rate near zero for years to come.. “The Fed just saying they are not going to raise rates until 2023 really means nothing,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “The Fed is on the sidelines, but if bond yields keep going up, that is what really hurts the economy.” Apple Inc and Amazon.com Inc both dropped more than 3%. Tech and other growth stocks are particularly sensitive to rising yields because their value rests heavily on earnings far into the future, which are discounted more deeply when bond yields rise. A recent $1.9 trillion spending stimulus sparked fears of rising inflation and contributed to the jump in longer-end Treasury yields. Underscoring the staggered recovery in the labor market, data showed the number of Americans filing for jobless benefits unexpectedly rose last week. A separate report indicated the Philly Fed business index jumped more than expected, to its highest level since 1973. The Dow Jones Industrial Average fell 0.46% to end at 32,862.3 points, while the S&P 500 lost 1.48% to 3,915.47. The Nasdaq Composite dropped 3.02% to 13,116.17. The S&P 500 and the Dow both closed at record highs on Wednesday. Accenture rose 1% after the IT consulting firm raised its full-year revenue forecast and reported second-quarter revenue above analysts’ estimates, as more businesses used its digital services to shift operations to the cloud. Dollar General Corp dropped 4.65% after the retailer forecast annual same-store sales and profit below estimates, indicating that a pandemic-fueled rush for lower-priced goods may be waning faster than expected. AMC Entertainment climbed more than 3% after the movie theater operator said it would have 98% of its U.S. locations open from Friday. Declining issues outnumbered advancing ones on the NYSE by a 3.69-to-1 ratio; on Nasdaq, a 3.42-to-1 ratio favored decliners. The S&P 500 posted 85 new 52-week highs and no new lows; the Nasdaq Composite recorded 213 new highs and 28 new lows. Volume on U.S. exchanges was 12.8 billion shares, compared with the 14.2 billion average for the full session over the last 20 trading days.
Americans Have $1.7 Trillion to Burn in Revenge-Spending Binge
(Bloomberg) — Shoppers are out for vengeance. A year into a pandemic that’s devastated lives, jobs and the economy, those who are lucky enough to have disposable income are ready to go out and splurge — even if they still have nowhere to go in that stunning dress or those brand new sneakers. Some are calling this “revenge spending.” U.S. retail sales are near record highs and employment and employment and vaccinations are on the rise. Americans have amassed a massive stockpile of excess savings — Bloomberg Economics estimates it to be about $1.7 trillion since the beginning of the pandemic through January. And that’s about to be bolstered by a new round of stimulus payments. As the economy reopens, consumer spending over the next two quarters is likely to be the strongest such period in at least 70 years with a rebound in services leading the way, according to economists at Wells Fargo & Co. “A lot of the snapback in spending will come from those more leisure expenditures — your discretionary expenditures,” said Shannon Seery, an economist at Wells Fargo. Revenge spending was seen as early as last April in China after the government began easing back to normalcy after the nation was the epicenter of the coronavirus pandemic in its early days. The impact on companies was clear: U.S. jeweler Tiffany & Co.’s China sales surged 90% in May from the year prior, while Hermes, the French luxury label known for its $10,000 handbags, raked in $2.7 million in one day from a store reopening in Guangzhou. China has been recovering ever since, even as the virus continues to rage across Europe and North America. The reopening of the nation’s domestic travel corridors sparked a tourism revival, with locals visiting destinations like Macau and Hainan. They’ve been spending so much there that brands like Ralph Lauren Corp., Estee Lauder Cos. and Coach are all scrambling to open more stores. There’s universal hope that there’ll be a similar fervor in the U.S. too.
While the U.S. economy will likely reopen gradually over the course of 2021, the federal government is already starting to distribute stimulus checks. Research suggests one-time payments boost spending more than steady payments that lead to a higher income. “This round of stimulus is coming at the same time that the economy is properly reopening,” said Michelle Meyer, head of U.S. economics at Bank of America Corp. “If you have a lot in your bank account already, you don’t have very much debt to pay off, you probably do feel more comfortable spending the stimulus check.” E ven the previous round of $600 stimulus checks, which were less than half the size of the incoming $1,400 payments, helped drive a January spike in discretionary purchases. U.S. retail sales jumped by the most in seven months amid increased spending on clothes, electronics, home furnishings and more. Department stores saw a nearly 21% increase in sales from the prior month. And there’s room to grow, since sales at many types of stores and restaurants remain below their pre-pandemic levels. While spending has eased from January’s breakneck pace — in large part due to severe winter weather — the new round of direct checks will give fresh support to consumers. The $1,400 payments could give restaurant sales a lift for up to seven weeks, according to an analysis by Bloomberg. It may take slightly longer for the wealthiest to shell out cash like they once did. The top 10% of earners account for nearly half of personal outlays in the U.S., according to calculations by Wells Fargo. These consumers, who have been forced into saving because of social distancing, are likely to come out in full force as the health crisis subsides and herd immunity is reached, Meyer said. Almost half of U.S. consumers, meanwhile, said they’d buy little luxuries in the next six months. Over a third said they’d go in on even bigger, more expensive products, according to a survey from Accenture. U.S. retailers from discount clothing stores to luxury jewelry boutiques have been waiting for this for months. Signet Jewelers Ltd., owner of Jared and Kay Jewelers, had hoped it’d come in time to bolster Valentine’s Day sales in February. That didn’t work out, but it’s better late than never. The CEOs of Abercrombie & Fitch Co., Coty Inc. and TJX Cos., which operates TJ Maxx, have each mentioned the prospect of revenge shopping boosting business in the coming months. Poshmark Inc., an online resale marketplace, said sales of summer dresses doubled in February from a year earlier. CEO Manish Chandra said it’s an early sign that the population is ready to get out and spend. “That to me tells us that we are getting ready for something,” said Chandra. “I think we’re all ready for that. America’s definitely ready and the world seems to be ready as well.”
Fauci warns of a third-wave of coronavirus cases
Chief White House Medical Advisor Anthony Fauci warned state leaders on Sunday (March 14) against easing their COVID-19 restrictions, as reported by CNBC. Appearing on two morning news programs, Fauci pointed to a spike in coronavirus cases in Europe as evidence that ending public health precautions too soon could extend the pandemic. “Don’t spike the ball on the five-yard line. Wait until you get into the end zone. We are not in the end zone yet,” Fauci said on “Meet the Press.” Easing restrictions too quickly led some European countries seeing a third wave of COVID-19 cases, Fauci said on FOX News Sunday. “They thought they were home free and they weren’t and now they are seeing an increase,” he added. “If you wait just a bit longer to give the vaccine program a chance to increase the protection in the community, then it makes pulling back much less risky.” According to CNBC, several countries in Europe, including Germany, Italy and Poland, have seen significant spikes in COVID cases, while Slovakia and the Czech Republic are reporting some of the world’s greatest number of fatalities from the virus. Last week, German public health officials reported a 20 percent increase in new COVID cases over the space of seven days. The wave in new cases comes at a time when Germany is also facing high unemployment and flagging retail sales. Germany, like some U.S. states, recently began lifting quarantine restrictions. “We have very clear indications for the fact that the third wave has already begun in Germany,” RKI head Lothar Wieler told reporters in Geneva. “I am very worried.” Wieler stressed that people need to continue to wear masks and practice social distancing. Last week, the Organization for Economic Cooperation and Development called for governments to increase the pace of their inoculation efforts to ensure economic recovery. “Speed is of the essence,” OECD Secretary-General Angel Gurría said in a news release. “There is no room for complacency. Vaccines must be deployed faster and globally. This will require better international cooperation and coordination than we have seen up to now.”
COVID SCIENCE-mRNA vaccines spur lymph nodes for longer-term protection
March 15 (Reuters) – The following is a roundup of some of the latest scientific studies on the novel coronavirus and efforts to find treatments and vaccines for COVID-19, the illness caused by the virus. mRNA vaccines spur lymph nodes for longer-term protection. Along with inducing antibodies for immediate defense, mRNA vaccines against COVID-19 also stimulate the lymph nodes to generate immune cells that provide protection over the long term, a new study confirms. The early wave of antibodies are generated by B cells called plasmablasts.
In healthy volunteers, blood tests showed that two doses of the Pfizer/BioNTech vaccine induced “a strong plasmablast response,” said coauthor Ali Ellebedy of Washington University School of Medicine in St. Louis.
The immune cells that will produce antibodies upon exposure to the virus in years to come – called memory B cells – are generated by germinal center B cells found only in lymph nodes near vaccine injection sites, his team explained in a paper currently undergoing peer review for possible publication in a Nature journal. In repeated biopsies of volunteers’ lymph nodes, “we saw a robust germinal center response,” Ellebedy said. The responses lasted at least seven weeks, “with no sign of cooling down anytime soon,” he added. “While we do not have long-term samples yet, it is safe to assume given the magnitude and persistence of the germinal center reaction that those individuals will develop a durable immune response” to mRNA vaccines. Moderna Inc’s vaccine also uses mRNA technology. (https://bit.ly/3tnAiYw)
Throat swab test accuracy may vary by time of day
The accuracy of gold-standard PCR tests of nasopharyngeal swab samples may vary by time of day, new data suggest. Researchers analyzed 31,094 tests performed in symptomatic and asymptomatic individuals at 127 testing sites, including 2,438 tests that showed COVID-19. In a paper posted on Saturday on medRxiv ahead of peer review, they report tests were most likely to be positive around 2 p.m. – and the proportion of positive tests in the early afternoon was two-fold higher than the lowest proportion seen at other times of the day. The study “suggests people may be more contagious at certain times of the day and it raises questions about whether tests for SARS-CoV-2 may be less accurate when they are collected between late evening and early morning,” said coauthor Dr. Candace McNaughton of Vanderbilt University. “If our findings are confirmed, clinicians and public health teams could focus their efforts on lowering the risk of viral spread during times of peak viral shedding,” she said. That could entail emphasizing mid-day to early-afternoon masking at home while isolating, or encouraging early morning shopping for vulnerable populations. “There may be greater benefit in repeat testing if a negative test was collected when viral shedding is generally less,” McNaughton said. (https://bit.ly/2NjcZiY)
Surgery delay advised after COVID-19
When possible, surgery should be delayed for at least seven weeks after infection with the new coronavirus, and patients who still have symptoms at that point may benefit from further delay, researchers advise in Anaesthesia. They reviewed data on 140,231 surgery patients from 116 countries, including 3,127 with a history of COVID-19. The mortality rate at 30 days after surgery was 1.4% in patients who never had COVID-19. It was 9.1% among patients diagnosed within two weeks before surgery, 6.9% among those diagnosed within 3 to 4 weeks, and 5.5% when the diagnosis was made 5 to 6 weeks preoperatively. The mortality rate came down to 2% when at least 7 weeks had elapsed between diagnosis and surgery. For patients with ongoing symptoms, the 30-day mortality rate was 6% even after a 7-week delay, researchers found. After adjusting for other risk factors, the odds of death were increased 3.6-to-4.1-fold in patients having surgery within six weeks after a COVID-19 diagnosis. “Patients with ongoing symptoms at least seven weeks from diagnosis may benefit from further delay” of their surgery, the researchers said.
Biden: 100M relief checks to be distributed over next 10 days
- Biden pledged to get 100 million shots in arms and 100 million checks in pockets in the next 10 days.
- As of Friday, the US had already administered 100 million COVID-19 vaccine doses.
- Stimulus checks from the American Rescue Plan are starting to hit Americans’ bank accounts.
President Joe Biden said on Monday that the US was on track to meet two big goals in the coming 10 days: administering over 100 million COVID-19 vaccine doses, and sending 100 million stimulus checks. “Over the next 10 days, we’ll reach two giant goals. The first is 100 million shots in people’s arms will have been completed in the next 10 days, and 100 million checks in people’s pockets,” Biden said during a speech at the White House.
“Shots in arms and money in pockets – that’s important,” he added.
The US hit the first goal on Friday, surpassing the benchmark of 100 million shots administered. The figure covers doses in Pfizer-BioNTech’s and Moderna’s two-shot regimens and Johnson & Johnson’s one-shot vaccine. As of Monday, 71 million Americans had received at least one vaccine dose, including 38.3 million who have been fully vaccinated, according to the Centers for Disease Control and Prevention. That means one in five US adults has gotten at least one vaccine dose. The Biden administration has recently made significant investments in the US’s vaccine supply. It plans to procure enough vaccines for all American adults by the end of May. On Thursday, in his first prime-time address to the American people, the president announced that the administration would direct states and localities to make every adult eligible to get vaccinated by May 1. Biden also confirmed that he would appoint the former national economic advisor Gene Sperling to oversee the implementation of the American Rescue Plan, the sweeping $US1.9 ($2) trillion COVID-19 relief package that Biden signed into law on Thursday. The bill includes $US1,400 ($1,811) stimulus checks for people below certain income thresholds and other direct aid for families. It followed the bill signed into law by President Donald Trump in December that delivered $US600 ($776) checks to eligible individuals. “We’re just getting started,” Biden said on Monday. “By the time all the money is distributed, 85% of American households will have gotten $US1,400 ($1,811) rescue checks.” Some people have already received their payments, and millions more Americans are set to get theirs in their bank accounts on Wednesday. People can check on the status of their check with the IRS’s “Get My Payment” tool.