COVID-19 Update | Wednesday, March 18 (AM)
March 18, 2020
- Reports this morning indicate that the Treasury Department has contemplated reducing trading hours if necessary to protect the stock market.
- The White House is still on track to issue an Executive Order this week that would apply new domestic purchasing requirements for pharmaceuticals and medical supplies.
- The order would include “Buy American” purchasing requirements for some U.S. government agencies, including the Department of Health and Human Services (HHS) and the Department of Veterans Affairs (VA).
- The order could also trigger the Defense Production Act administered by the Commerce Department. That would allow the U.S. government to change existing arrangements to require contractors to switch their production lines to manufacture medical supplies and other necessary goods. This move had been hinted at by HHS Secretary Alex Azar earlier this month.
- President Trump is scheduled to speak to airline executives today at 10am – this comes off the heels of the President stating on Tuesday that the federal government wants to help Boeing and the airlines’ request for federal assistance.
- Vice President Pence has asked construction companies to contribute their inventories of protective masks to medical providers.
- The Association for General Contractors (AGC) has indicated that this would jeopardize safety and that it was not warned of this request. AGC is seeking further clarification.
- Our nation’s trucking sector has called on the Department of Transportation to keep rest stops open during this time to protect the safety of American truckers. This comes after Pennsylvania decided to close state-owned rest stops during the outbreak. DOT has labeled truck stops as “essential businesses” that should stay open during the outbreak, but that designation only applies to privately owned truck stops.
- Secretary Mnuchin warned yesterday that unemployment could rise to 20 percent without government intervention.
- The Senate is expected to begin consideration of Phase 2 of the COVID-19 relief package today.
- As indicated yesterday, Phase 3 of the package is still being worked on by Senate Republicans. There is soft deadline of Friday for the Republican package which would then have to be negotiated with the Democrats.
- During the White House pitch to lawmakers, several Senate Republicans indicated that they did not like the idea of bailing out big companies.
- Senators Richard Shelby (R-FL) and Rick Scott (R-FL) in particular raised issue with bailing out large companies.
- Democrats continue to prioritize the inclusion of protections for workers and consumers in any airline aid package.
- Senator Schumer’s proposal also calls for “relief for public transportation to ensure continued operation until normal ridership resumes.”
- Multiple reports this morning indicate that the travel industry could be the hardest hit industry as a result of the COVID-19 outbreak – the industry writ large is predicting a $355 billion decrease in travel spending this year and a possible 3.6 million jobs lost. Other statistics show the entire industry may lose $740 billion in revenue due to COVID-19.
- The hotel industry may end up being the hardest hit within the travel industry, losing an estimated 4 million jobs, which could result in a $300 billion hit to our national GDP.
- The head of the American Hotel and Lodging Association told reporters that COVID-19 has “already had a more severe impact on our industry than 9/11 and the 2008 recession combined.”
- The job losses faced by the travel industry could increase the national unemployment rate from 3.3 percent to 6.3 percent.
- The United States and Canada may jointly announce an end to non-essential travel between the two countries today – the flow of critical goods across the border would not be impacted.
- Amtrak has asked for $1 billion in aid, transit agencies have determined they need $13 billion, and New York’s MTA in particular has said it needs $4 billion in federal aid.
- Amtrak has reported a decrease of more than 60 percent in ridership.
- The cruise line industry continues to ask for low-interest or interest-free loans.
- Volkswagen is halting production at its European factories due to COVID-19 beginning on Thursday.