Although some cities and states have imposed higher minimum wages, the federal minimum wage has not kept up with the times. Fifty years ago, people working at the minimum wage were receiving a salary that was 50% of average hourly earnings. Today, the $7.25 per hour minimum wage is 29% of the $25 average ... READ MORE >
Joe Brusuelas
The pandemic, health care access and the economy
The outbreak of the novel coronavirus has highlighted the massive health care access inequalities that continue to plague the richest country in the world. The coronavirus is attacking both rich and poor, but it is most destructive among the poor who lack access to a healthy living environment. It’s ... READ MORE >
US June personal income and spending: Difficult days for the American household
The American household finds itself under extreme duress as loss of income and jobs caused by the pandemic is on vivid display inside the June U.S. Personal Income and Spending Report. Despite a robust increase in spending, based on income dynamics that are in play during the pandemic, it is quite clear ... READ MORE >
Policy improvisation is needed to prevent broader business catastrophe: Three fixes for critical aid needed by small and midsize companies
The government aid rolled out to small and medium-size enterprises, which was exhausted after only 13 days, has been problematic at best; at worst, if not changed, it will lag the survival period of many struggling businesses. The U.S. government framework is going to have to be enlarged, include more ... READ MORE >
Bending the curve, reopening for business and avoiding the policy errors of the 1918-19 pandemic
Deaths attributed to the Covid-19 pandemic continue to mount, and data confirms that social distancing and a rigorous system of testing and tracing are necessary to slow the spread of the disease, and are working to mitigate the health crisis. Recent modeling work suggests that the slow adoption of social ... READ MORE >
Fed sets up $2.3 trillion in liquidity commitments, introduces Main Street Lending Program
The Federal Reserve made history on Thursday by moving aggressively to provide up to $2.3 trillion in liquidity commitments to support the economy. This policy intends to bolster households, small and medium-sized firms, and the ability of state and local governments to float debt to ensure critical ... READ MORE >
Saving small and medium-size business: temporary lending facility needed now
This week U.S. Treasury Secretary Steven Mnuchin told a group of Republican senators they need to act to prevent an increase in the unemployment rate to 20%. While some would say that is political hyperbole, it is not. Policymakers, investors and company managers will observe a jump in first-time jobless ... READ MORE >
Fed and Treasury create Commercial Paper Funding Facility to ease credit stress
The U.S. Treasury on Tuesday granted the Federal Reserve 13(3) authority under Dodd-Frank that permits the central bank to take steps under exigent and unusual circumstances to stabilize financial markets and the economy. The U.S. Treasury stepped forward with a $10 billion backstop to fund a ... READ MORE >
The RSM Brexit Stress Index shoots up, reflecting coronavirus supply shock concern
Following the U.K.’s departure from the European Union more than a month ago, markets are bracing for a global health crisis and the accompanying supply shock. The RSM Brexit Stress Index -- which measures financial and economic risk surrounding Britain’s departure from Europe’s common market – has shot ... READ MORE >
An improved outlook for manufacturing filtered by Boeing and the coronavirus
The RSM US Manufacturing Index implies improvement in national manufacturing sentiment in February, and we expect a similar uptick in the February ISM survey of manufacturing sentiment next month. However, February may be the last month before the coronavirus takes its toll on the global supply chain; at ... READ MORE >