Another week of pandemic news, another 4.4 million jobs gone. Here’s the latest from the business and tech worlds, plus what you need to know for the week ahead. (What day is it, again?)
What’s Up? (April 19-25)
Keep It Coming
Job losses continued their record-breaking streak for the fifth week in a row, bringing the unemployment rate to nearly 20 percent, according to some analysts. Lawmakers are already agitating for another stimulus package to follow up the $484 billion rescue bill passed on Thursday, which replenishes funding for programs to aid small businesses and hospitals. The bill also mandates that the Trump administration help states step up testing, which public health officials view as essential to reopening the economy. State governments need all the support they can get: many are running out of money and governors are facing pressure to ease lockdown procedures without setting off a second wave of the outbreak.
Oversupply and No Demand
Oil prices went negative this past week for the first time ever, meaning anyone who wanted to sell a barrel would owe the buyer about $30. Which seems like a great deal for buyers! But the problem is that few consumers need oil right now, since the pandemic has virtually halted economies and forced billions of people around the planet to stay at home. So anyone who owns barrels of oil has to pay to store them somewhere, and that’s getting expensive. Oil-producing countries are reducing supply, but analysts say prices will remain at historic lows for some time.
What will become of Victoria’s Secret now? It was already suffering from financial struggles and a tattered corporate reputation when Sycamore Partners, a private equity firm, agreed to buy it in the halcyon days of February. Since then, like many retailers, the lingerie company has furloughed most employees, cut executive salaries and missed April rent payments while its stores sit full of unsold merchandise. Now, Sycamore is trying to back out of the deal. It’s the highest-profile example to date of a buyer trying to wriggle out of an acquisition because of the pandemic, and Victoria’s Secret won’t go quietly.
What’s Next? (April 26-May 2)
To crack down on a glut of misleading and fraudulent ads popping up across its network, Google announced that it would require all its advertisers to identify themselves and where they operate. It will also pass along that information to consumers. Starting this summer, Google will display the names of the companies or people paying for the ad space, as well as their countries of origin, on the ads themselves. The initiative will start in the United States before expanding worldwide, and is part of Google’s attempt to stop businesses and individuals from misrepresenting themselves or their products in paid online promotions.
The Federal Reserve will meet this Wednesday to decide on interest rates, which don’t have much room to go lower; they’re already near zero. In related news, the Fed said that everyone who participates in its new coronavirus relief programs will be publicly named, along with how much money they borrow and the interest rate charged. That information will be published at least monthly as part of the Fed’s commitment to “transparency and accountability,” Jerome Powell, the Fed chair, said. It’s also a departure from the Fed’s previous protocols, and comes as the government is under scrutiny for bailing out bigger companies that didn’t need it and leaving smaller ones out to dry.
A Bacon Back Order
Don’t rush out to buy steaks because you’ll only make it worse, but the country may be looking at a meat shortage soon. Several meat plants have become major “hot spots” for the coronavirus as their workers have fallen ill. And after decades of consolidation, a relatively small number of meat processing facilities account for the vast majority of production. This weak link in the country’s food supply chain could have you dipping into your emergency dried bean supply even sooner than you expected.
Citing the job shortage caused by the pandemic, President Trump ordered a temporary ban on new green cards. But the measure exempts migrant health care workers, overseas spouses and young children of American citizens. Shelter-in-place protocols have been good for Netflix, which reported a record 16 million new customers during the first quarter of this year. And now that Amazon is dealing with new challenges posed by the pandemic, its chief executive, Jeff Bezos, is resuming oversight of day-to-day operations.