So as a non-US citizen, I didn't know about "at-will employment" [1]. Apparently, in some states, companies can fire people "at will" (so without any reason, at any given moment).
As an EU citizen, this sounds utterly horrifying to me. How can the US have that little protection of their workers..?
Tax free health insurance is tied up with employer, not healthcare (or health insurance). Anyone can purchase health insurance at healthcare.gov. Recently, the ability to purchase health insurance with pre-tax money has been expanded to self employed, but people who work for an employer that does not offer health insurance are still discriminated against.
Yes, this pdf shows how much health insurance costs per month for a person in the state of New Jersey (a higher cost of living state, but not far off New York/California):
The metal levels indicate what portion of your expected healthcare costs the insurance is expected to pay. Bronze is 60%, Silver is 70%, Gold is 80%. At the bottom you will see age rating, so you have to multiply that factor with the premium to get the premium at your age.
For example, if you purchase bronze coverage (lets say $250) as a 50 year old in NJ, the factor is 1.78 times $250 = $445 per month divided by 0.6 due to it being bronze = $742 per month is your expected healthcare expenses.
Obviously this is not per month, but becomes more accurate amortized over ones' lifetime, as you might go with zero healthcare expenses for years and then get hit with $10,000 easily.
Bottom line is eat right, exercise, and either be poor enough to get taxpayer paid healthcare or be rich enough to not care about spending ~$20k per year per couple in their 50s on health insurance premiums plus have ~$30k or so ready for out of pocket costs in case of emergency. If something happens to you at the end of December, the out of pocket will reset Jan 1, so you need to have two years worth of out of pocket costs, and at around $13k or so, I ballpark it at $30k.
If I'm in the middle 30% to 80% wealth band of the US, I would plan on killing myself if my prognosis was poor to avoid draining the family's wealth.
65+ enter the magical land of Medicare, where the taxpayers start taking care of you and paying for your medical care.
But over the years, even that has been chipped down and is extremely confusing, with a combination of means testing and supplementary insurance programs that you need to buy to get "full coverage".
But basically, 65+ means if you go to the hospital, and get a $300k bill, it won't ruin your finances as the government picks up the hospital bills. I'm pretty sure. But there's Part A/B/C/D/etc, which cover different things like prescription medicines, non hospital healthcare, etc that are not paid for or partially paid for, and you have to buy supplementary insurance for those.
Also, health insurance in the US is not just insurance, it's also buying access to a set of healthcare providers that the insurance has negotiated pricing with, so that you don't get taken advantage of by the healthcare providers who can otherwise charge you whatever they want.
As you can see, the US spends a decent portion of its time trying to figure out how to take advantage of the system (i.e. each other) and wring out as much as possible while putting in as little as possible.
Oops, I got that mixed up with the ability for small business to reimburse employees with tax free money for purchasing health insurance from healthcare.gov
gotcha. that's recent, iirc, like... in the last year? weren't many companies already doing 'HSA funding' as a benefit before that? Was it just taxable (but... contribution to a HSA would be deductible for me even if the income is initially taxable, so would seem a wash?). I understand this is the actual insurance though.
HSA’s and related tax benefits are a different topic than paying for the monthly health insurance premiums with pre-tax income.
People whose employers offered health insurance got to pay their premiums with pre tax money and contribute to HSA with pre tax money.
People whose employers don’t offer health insurance have to pay the premiums with post tax money. But they still get to contribute to HSA with pre tax money.
You know, it's probably not that a large problem because those are very few people, but this one is completely insane. I have no idea how nobody still found it completely opposite to fundamental freedoms. It just escapes being outright slavery because those people can run away to their home country.
On the flip side, European countries had high unemployment even before the Coronavirus recession because employers were reluctant to take on new employees knowing that it's much more difficult to get rid of bad ones there than here.
In the US, there's the risk of lawsuits after you fire someone, which I guess creates the same resistance and hurdles to hiring as the added protection in the EU.
Plus, my personal experience is that we easily found many OK candidates in the US but had trouble finding one in the EU. That either suggests that the EU has less skilled coders overall, or that the US has a higher rate of people who are unemployed or very unhappy with their current job.
> How can the US have that little protection of their workers..?
The US has spent the last 65 years chipping away at unionization rates and other pro-employee protections. The overall rate of unionization in the US peaked in 1954 [1].
On the flip side, hiring is much easier since the employer doesn't have to go through so much red tape for hires that don't work out. There's tradeoffs to each method.
If hiring is so easy, why does everyone complain about how hard it is to hire someone competent? Employers inflict on the candidate two rounds of phone screening, a take-home project, two rounds of on-site interviews, psychometric testing, augury from flight of birds, augury from feeding of chickens, a haruspicium, diversity statement and inquiry from the I-ching, and despite all these measures they still complain how hard it is to hire a decent programmer.
I'm assuming selection bias. You're not going to hear non complaints. Also, the buyer's goal is to buy the best product for the lowest price, and many people are probably offering too low a price for the product they want.
I agree that workers need protection. For most people, there is a large power imbalance that can allow companies to take advantage of their workers.
However, things can go too far in the other direction. Imagine a small business having to spend months and months trying to fire someone who isn't doing their job and hasn't been receptive towards coaching or critiques. This could seriously harm the team they work on, not to mention the overall health of the company.
I don't know what the best solution is. But there are some complexities here.
Most places allow a probationary period for new employees. In practice, if you have actually done the assessment process and formal critique in a documented way, it's not a problem to get rid of someone who actually isn't working. What you can't do is fire people on a whim or personal anger.
Do you think that those describing difficulties in firing people as well as negative second order effects are significantly overstating these issues? I haven't researched this much myself, but the potential downsides seem fairly plausible to me.
Thinking about it more, I suppose I've also had this implicit assumption that at-will employment has contributed to the disproportionate success of startups in America. It seems like it could be the case, but I don't have any hard evidence.
But as an employee, you can also quit without notice. It's fair and balanced. </sarcasm>
There is the federal WARN Act (1) but it has holes big enough to drive a train through (natural disaster and unforeseeable circumstance exclusions mean it doesn't apply right now).
As the sibling noted, potentially the most devastating impact of the jobless claims is loss of medical insurance. We'll likely see tens of thousands of personal bankruptcy filings as a result of this pandemic, many of which will be due to ER/ICU bills.
See your fair and balanced and raise with The rain it raineth on the just
And also on the unjust fella;
But chiefly on the just, because
The unjust hath the just’s umbrella
I thought the bill covered ALL Coronavirus expenses. I can't find a source, so I'm not sure if it does or not. Do you know?
I also know that people can use COBRA to keep their employer's insurance if they're laid off, but often this can be too expensive. But are they able to get a new insurance plan or do they just not have insurance if they don't keep their employer's insurance?
I get it that people will have other medical issues during this time. But whether it covers Coronavirus related-expenses makes a HUGE difference. Coronavirus is BY FAR the leading cause of hospitalization in the US right now. It's also the leading cause of death. For a month, it's likely to get exponentially worse. It's likely to remain this bad for 2-3 months minimum.
Meaning, the costs could be astronomical, and as you pointed out, would DESTROY people not covered by insurance. This could honestly be almost as bad as the Subprime housing crisis. Something like 800k people filed bankruptcy from Subprime. Conservatively, we're likely to see 500k semi-severe hospitalizations. If 30% of them are unemployed, I don't know how that doesn't lead to 150k bankruptcies.
YMMV, but I would say that's on the conservative side.
How can the US have that little protection? By not passing laws protecting workers, it's quite simple, actually.
The implied "why" would be a more fluid workforce. We've all heard the horror stories of companies/industries/nations paralyzed by an unmotivated/unproductive workforce. Hell, we have the same jokes here about jobs in some government agencies and big corporations.
The thought is "quick to hire, quick to fire".
I don't mind it; I just think the situation where you lose your job AND your health care is insane.
I'd like a stronger social safety net.
On the other hand, perhaps countries with a stronger social safety net make it harder for companies to fire, so they push the burden back on the companies to keep from stressing social services.
> So as a non-US citizen, I didn't know about "at-will employment"
"At-will employment" might be a US legal concept, but it's everywhere in Asia.
A few first-world economies (like Singapore, where I'm at; perhaps Hong Kong too) have similar (or less) employment protection to keep their reputations as "business-friendly" countries.
You can do exactly the same in the UK if they've worked for you fewer than two years. You just have to pay their notice period (which is probably just two weeks of salary so hardly much protection).
Big surprise, CNN blasting out misleading & sensational headline because it aligns with the owner's personal political agenda. If you don't believe me, follow the money.
Edit: and if you downvote me without a response, you are a coward.
I object to major news networks using agenda setting and sensationalized media framing strategies to mislead the general public. For example let's dissect the headline:
1.) "3000%" - Let's calculate the highest possible number to use here!
2.) "% jump" - Let's only consider the increased aspect of the jobless claim ratio!
3.) "jobless" - Let's not point out that most of these people will be immediately back to work shortly!
4.) "devastated" - Let's find the most dramatic verb to use here!
5.) "US" - Let's only focus on the US, since that allows us to use the highest possible number in #1!
6.) "has" - Let's use an auxiliary verb that implies the ensuing claim has already occurred, when it hasn't!
7.) "has devastated the US job market" - Let's make a sensational claim that not only isn't measurable, but hasn't had enough time to play out yet, so therefore isn't true!
I could probably do this for 90% of articles coming from CNN. It's not just about the clickbait, it's about what they're choosing to report on, and how they are framing it.
If you don't want people to downvote you, provide the evidence and explanations for your claims. Not doing so simply comes off boy-crying-wolf-spiracy.
Any idea why the stock market is still holding up? Whether or not you think the virus will be resolved quickly, the economy has now taken a serious hit. Is the feeling that the government stimulus actions will be enough to completely erase the Covid damage? Will they resolve the shaky fundamentals and sky-high valuations we saw heading into this mess? Perhaps I'm a simpleton for expecting rational markets, but it seems like equities should be falling further.
I'm not sure the economy is getting a hit as big as it looks, but it's rather on "pause".
I think many of these workers are laid off so they can get unemployment benefits, and they'll be hired again by the same companies as soon as the quarantine ends - which should take a couple month if we look at what happened in China.
Sure, some companies will die from losing all of their business during the quarantine, but the number of jobless claims is not representative of the workers who will still be out of a job after the quarantine.
The million dollar question is, will this be a 'V shaped recovery', a.k.a. 'pause' or will it turn into something worse. I hear a lot about companies with cash flow problems which may not survive the hit. Is that true? Beats me. It seems credit is cheap right now. What about long term though? For many industries, it takes a while to spin things back up and see cash flow. Will the economic mitigation measures be enough to see those companies through?
We may also be looking at permanent changes in behavior. Sure, there is a lot of pent up demand for getting out and socializing, but if people are being bled dry by meager stimulus checks, they're not going to rush to fill the restaurants and malls when this is over.
Credit being cheap only works if you have a good plan and expectations that the business is going to survive. Most small businesses are not in that position (and even large businesses like Macy's, Cheesecake Factory and Subway). Shops that are not getting foot traffic now have no idea when they'll be able to reopen, getting a loan to pay their lease would probably be unpayable afterwards. Business owners also need to make a living, so they are looking into getting jobs or starting alternative businesses. Their original businesses are most likely not coming back.
And there's no way the economy will fully reopen before at least a year. China is not a good comparison, because 1) the US did not follow the same approach as China in dealing with the virus, 2) China has been lying about their economy and number of cases and 3) even if China was fully open for business now, the biggest markets are not buying - Europe and the US are just beginning a huge recession, that in turn will hit China back and will affect the recovery of the world economy.
A V shaped recovery is, in my opinion, a made up dream to keep people from panicking.
Unfortunately there is no evidence to suggest that the US will get out of this anywhere as quickly or efficiently as China.
On the contrary, so far it appears US cases will peak much higher and later than in China, and a lack of resources at the state and local level will massively slow any subsequent recovery.
Nobody has any idea what is actually happening in China, and most of the numbers are more propagandistic than informative, so we should probably just stop speculating entirely.
The best numbers I've seen for projecting US cases and deaths honestly seem to be pretty good:
This projects less than 100k deaths in the US this year. Compare that to heart disease (largely preventable) at 650k a year. That'd also make it only about 5 times worse than a bad flu year. (Edit: thanks for the correction below; if correct, this would be only about 2 times worse than a bad flu year.)
100,000 dead in three months is not “pretty good”. Honestly, I don’t understand the casualness that people seem to have around the number of deaths. “It’s not that bad” is such a callous take.
Are you incapable of understanding relative terms?
Compared to the millions of people dead in the US that many were projecting just a few days and weeks ago, this is indeed good -- in fact, very good, because it seems many fewer people will die.
100,000 - 250,000 dead is not something to celebrate. It is a reflection of the failure by the current administration to take this seriously all the way back in January. That number would be much lower if proper steps were taken back then.
Also, that 100,000 assumes everyone in the country follows proper physical distancing, hand washing, etc. Last I checked, the state of Florida is still allowing for church services during their "lock-down".
Your post reveals that you are viewing things through a political lens.
It's true the administration could have acted sooner. It's also true the opposite party was smearing 'racism' and 'xenophobia' even as shutting flights down was obviously the right move. This is not a scenario where any politician can claim to have done better.
In fact, world-wide we have seen a variety of responses, with no definitive answer on what has been good and what has been bad. It's a horrible situation for any national leader.
As to the number of dead.... it is what it is. Is it good? Certainly not. Could it be worse? Certainly. Does anyone have all the optimal answers. Certainly not.
Experts estimated we'd be at 20k cases roughly by March 31st...we were at like 200-300k... so yeah experts don't know much either on how this will turn out. Some of the states not taking it seriously will drive numbers way up beyond experts best guesses.
Best way to guage the toll is take a glance at deaths in 2019 vs 2020 and the difference is covid-19 related. Even if it's a heart attack who couldn't get into the ER because it was full...etc..
Death rates really don't capture the full picture. What if zero people died from the disease directly, but it still caused painful illness with possible long term complications and overwhelmed health care systems? The economy would still be shut down. Social distancing would still be in place. The economic damage has very little to do with how many people die, and very much to do with how many people are unwilling or unable to participate in the economy.
I haven't seen it but I'm guessing that won't show up until next year. I'd figure that people who survive the virus and can breathe on their own have to wait for follow up since resources are tight.
This is with lockdown in place. No lockdown and you could aim for 600 to 2M death in the US alone. ten to twenty time a bad flue year.
Also some people are out of the ICU (at least in France) and will have to do 3 to 6 month of reeducation for the best cases. For the worst cases (still in ICU at the moment, at least in Colmar), its 20 years shoved off (lung fibrosis), one of them is younger than me. I guarantee you lethality might be what we're talking about now, but next year it will become secondary.
My coworker's whole family lives in Beijing. Her father died recently. He suddenly was having a hard time breathing, was brought to hospital, and by then his blood oxygen was far below normal.
They refused to test him for COVID19. She told me this. Her facial expression was utter shock, and she told me her mom's grief has been multiplied by the fact that the government doesn't want to be honest about his real cause of death.
People who believe the data coming from China is accurate are ignoring the recent history on transparency around this disease from the CCP. I just don't understand it. Sure, the country where police arrested the first doctors to publicly state it was human to human transmissible is being completely honest. Wow.
Two things can be true at the same time:
Trump administration has done poorly AND the CCP is culpable, lying, and made the situation much worse.
But in the US political system, there is no tolerance for distraction from hating the opposition party. You can only blame Trump, and saying bad things about China is "just racist and mean. They did such a great job, they say they have contained it. We didn't because the bad orange man didn't do his job."
Yeah, meanwhile, those of us living in reality know that Trump and the CDC/FDA suck, AND the CCP does too. And yeah, maybe, just maybe, if the US news media had dedicated 1/20th the coverage they gave to the impeachment to the virus, the government would have been held accountable to start acting then. I was travelling internationally, and when I got back home in early February, I was shocked at how little CNN and MSNBC were talking about the virus. Basically zero. And Fox only talked about it in the context of the impeachment distracting from it.
When governments fail, we hope that the free press will hold them accountable, and there's no reason they couldn't have done that earlier. No, the red vs. blue team sports are just too good for ratings to talk about things that actually matter.
Remember how Trump was roundly criticized as 'racist' and 'xenophobic' for stopping flights? The Democrats have to own that one, their answers were flawed and would have cost lives as well.
But really-- nobody has all the optimal answers. War is hell.
Trump reacted late, and by the time he acted he was slamming the barn door after the horse had left (or more accurately after the horse was inside the barn). The virus came across on flights from Europe just as fast and just as damagingly as it did from China. You can't stop a pandemic like this at your borders. Trying to do so just prevents the flow of critical people and materials and distracts resources from more effective responses.
Testing and social distancing were the steps that were needed on day one. They didn't happen fast enough and aren't happening fast enough.
It is not politicizing things to state the fact that his responses have been slow and poorly informed.
> they'll be hired again by the same companies as soon as the quarantine ends
Hopefully, yes, although this turnaround has some unfortunate bureaucratic costs to both the employees and employers. I hope those small-medium business loans work for keeping a reasonable number of people on payrolls. While the administration of those loans has its own potential pitfalls, in some ways it seems like the better path than leaning on the unemployment insurance system.
>I think many of these workers are laid off so they can get unemployment benefits, and they'll be hired again by the same companies as soon as the quarantine end
That is highly doubtful. Many companies can't survive even 2 months of inactivity and will fold.
>which should take a couple month if we look at what happened in China.
China is undergoing a second wave right now [1] due to unlocking quarantine too early. It's extremely likely that they will be undergoing a second lockdown. Anecdotally, speaking to a lot of my friends in NYC most everyone who is currently WFH (myself included) isn't planning on returning back to the offices until at least the end of the year. Realistically, I think we won't fully get rid of lockdowns until vaccine is available and 80% of the population is vaccinated.
The stock market isn't holding up, it's down 26% since this started. The thing to remember is that the stock market is predictive; it fell when investors foresaw the job losses, before they actually happened.
That would seem to be the case, but keep in mind that doesn't mean they are right (but I hope they are). We are in uncharted waters here, so the models and playbooks of investors may be even less accurate than normal.
In 2008 gdp declined by ~2% and the stock market fell 50%.
The downright dreadful forecasts coming in about 2020 GDP double digit declines seem to me to warrant a larger decline in equities.
I think a lot of folks think this will be a sharp V recovery, but I'm not so sure. I'm already seeing knock-on effects in the real world. People in tech being laid off; (formerly) rich folks cutting way back on planned spending; entire projects canceled, etc.
This does seem to be accelerating, although recall that this year opened with a fair few headline-grabbing mass layoffs. It's hard to say that more weren't already coming, with the timetable just moved up.
Supposed you have some 10k dollars you won't need at the next 2 years. What would you do with them right now? How do you expect the stock market to look like in 2 or 3 years? Do you expect any of the causes of the currently overvaluation you are seeing to be gone?
Buy into a vanguard fund like VTSAX and then put in a little bit every month, so you just average it out over time, rather than obsessing about trying to pick when it hits bottom.
1) A large portion of equity is held by large funds, which may be contractually unable to pull out of the equity market at all.
2) Lots of people are in it for a short term bump based on stimulus expectations
3) Most investments are made with a longer time horizon than the immediate pain of the short term, and thus, have no reason to sell now.
I think this could be an excellent rare economic data point to suggest the efficient market hypothesis does not work anymore (trumped by behavioral economics issues).
I heard 401k target date funds are rebalancing to maintain the desired ratios. The algos are buying stocks. Not sure if that is actually happening but sound plausible with auto rebalancing.
The stock market is just a collection of people betting on where they think things are going. The market declined 25-30% because people were predicting a downturn. Now we’re in that downturn.
The reason the market didn’t tank today is because this jobs report was already priced in.
Stock market lost connection to "people" long time ago. It is all big funds and algos, small investors who want to manage their own money are not even visible. Quite a lot action happens in pre and after-hours as well (look at these open gaps over last couple weeks) - "regular" public cannot even get there.
You can take people to mean whatever you want. Behind those algorithms and big funds are people pulling the strings. At the end of the day the market is a reflection of where things will go.
While I don't think the selloff is over, the bull case for American equities (I assume you are talking about U.S. stock market) is still quite strong:
- Emerging markets, Japan, and Euro also being hit by the virus. Where else will capital flow?
- International bond markets selling off as credit risks rise removes bonds as the traditional flight to safety (US Gov Bonds being the notable exception).
- Strong US dollar vs. other world currencies gives international capital extra safety when parked in U.S. stocks.
- Large-cap U.S. equities such as those in the S&P 500 can generally weather short-term liquidity shocks like this, and if anything they will grow by absorbing the market share of failing small businesses.
FWIW: Japan (for sure) and Europe (probably) seem likely to recover from the lockdowns rather faster than the US, which is just now getting started in big chunks of the country.
While I agree in principle that the markets are trying to price in the downturn, I genuinely don't think that the median-dollar-investor abstraction really has a clue how long this is likely to last.
It's anybody's guess at this point. Most people at r/wallstreetbets on Reddit are saying three things: 1) "it was priced in", meaning that somehow investors already expected this to happen, 2) the Fed is propping up the market with unlimited QE (Quantitative Easing), which means they are printing trillions of dollars to buy up a lot of bonds to create liquidity, and 3) today's rally is driven by oil prices surging because of Trump's tweet saying Saudi Arabia and Russia will cut down production to help stabilize the market.
They are also kind of shocked that stocks are not plummeting and saying the market is rigged. Seems like a lot of people have been buying PUT options expecting the market to crash soon.
Non expert speculation: we are printing money like no tomorrow. We are giving $4 trillion in free money to large corporations. With how easily they agreed to that there’s reason to expect they’ll do even more. There’s a huge demand for USD outside the US. All this means may be heading for a period of high inflation in the US despite the recession. People need to put money somewhere and assets are the only place to go.
If we go by textbook definition of stock prices, it is supposed to be the "present value of future cash flows". If we do not expect the society to be fundamentally altered due to COVID-19, then future cash flows should not really be affected from what they were assumed to be in Jan-2020.
So I would like to rephrase your question - what kind of permanent change do you expect in our society due to COVID-19?
The FRB is printing $90B per day as part of its open-ended QE program ( $935B in Treasurys and $344B in agency paper since 16 Mar )
While they are not technically buying stocks, every dollar of paper they buy from primary dealer inventory is a dollar that managers will find a home for.
The horrific employment news portends the need for the Fed to make $90B/day look like amateur hour in the near future. Hence, the run up in basically every single asset class today.
Understand that in an era of perpetual debt monetization, silly things like P/E multiples, employment, or earnings growth don't anchor stocks. Infinite liquidity combined with fund managers with a fetish for yield, no matter what the risk, are the only relevant mechanism in town. It's entirely possible to simultaneously have DJIA at 50,000 and half-mile-long lines for soup kitchens in this environment.
Unless small businesses know how long they'll be closed, I'd guess it's hard for them to know whether they'll survive.
It's also unclear, once things open up again, whether people will spend like they used to or whether the loss of potential customers' paychecks will add to the pain of small businesses.
I would say that these people lose their health insurance, but sadly they probably didn't have any to begin with, as many of the losses are service industry jobs. There are many positive things about the US, but the lack of comprehensive affordable medical coverage seems cruel. Especially tying it to employment.
I'm curious what will happen to restaurants. Will there be a permanent setback as people realize how to cook at home and how much money it saves? If so, that seems like a long-term win for physical and financial health. But in the medium term will hit people in the industry pretty hard.
I'm also curious how much it really helps health (and maybe even financial health) overall. Real home cooking is good compared to burgers and fries. But frozen pizzas are not great compared with some healthier restaurant options. And some restaurant food is pretty cheap and some packaged food surprisingly expensive.
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[ 2.9 ms ] story [ 197 ms ] threadAs an EU citizen, this sounds utterly horrifying to me. How can the US have that little protection of their workers..?
[1] https://en.wikipedia.org/wiki/At-will_employment
And even worse again is that healthcare is tied up to your employer..
https://www.state.nj.us/dobi/division_insurance/ihcseh/ihcra...
The metal levels indicate what portion of your expected healthcare costs the insurance is expected to pay. Bronze is 60%, Silver is 70%, Gold is 80%. At the bottom you will see age rating, so you have to multiply that factor with the premium to get the premium at your age.
For example, if you purchase bronze coverage (lets say $250) as a 50 year old in NJ, the factor is 1.78 times $250 = $445 per month divided by 0.6 due to it being bronze = $742 per month is your expected healthcare expenses.
Obviously this is not per month, but becomes more accurate amortized over ones' lifetime, as you might go with zero healthcare expenses for years and then get hit with $10,000 easily.
Bottom line is eat right, exercise, and either be poor enough to get taxpayer paid healthcare or be rich enough to not care about spending ~$20k per year per couple in their 50s on health insurance premiums plus have ~$30k or so ready for out of pocket costs in case of emergency. If something happens to you at the end of December, the out of pocket will reset Jan 1, so you need to have two years worth of out of pocket costs, and at around $13k or so, I ballpark it at $30k.
If I'm in the middle 30% to 80% wealth band of the US, I would plan on killing myself if my prognosis was poor to avoid draining the family's wealth.
EDIT: Follow-up question, the table ends at 64+, how do senior citizens pay for this without having a job?
But over the years, even that has been chipped down and is extremely confusing, with a combination of means testing and supplementary insurance programs that you need to buy to get "full coverage".
But basically, 65+ means if you go to the hospital, and get a $300k bill, it won't ruin your finances as the government picks up the hospital bills. I'm pretty sure. But there's Part A/B/C/D/etc, which cover different things like prescription medicines, non hospital healthcare, etc that are not paid for or partially paid for, and you have to buy supplementary insurance for those.
Also, health insurance in the US is not just insurance, it's also buying access to a set of healthcare providers that the insurance has negotiated pricing with, so that you don't get taken advantage of by the healthcare providers who can otherwise charge you whatever they want.
As you can see, the US spends a decent portion of its time trying to figure out how to take advantage of the system (i.e. each other) and wring out as much as possible while putting in as little as possible.
I've been doing it for 12 years. This isn't 'recent'.
People whose employers offered health insurance got to pay their premiums with pre tax money and contribute to HSA with pre tax money.
People whose employers don’t offer health insurance have to pay the premiums with post tax money. But they still get to contribute to HSA with pre tax money.
But in practice, it's so prohibitively expensive that many people just...don't. Pre or post tax, it's insanely expensive. Europeans would be shocked.
You know, it's probably not that a large problem because those are very few people, but this one is completely insane. I have no idea how nobody still found it completely opposite to fundamental freedoms. It just escapes being outright slavery because those people can run away to their home country.
Plus, my personal experience is that we easily found many OK candidates in the US but had trouble finding one in the EU. That either suggests that the EU has less skilled coders overall, or that the US has a higher rate of people who are unemployed or very unhappy with their current job.
Did you cherry-pick that one? Spain @ 14.2%, Italy @9.7%, France @8.5%. Spain was actually at 26.2% back in March 2013.
https://www.google.com/publicdata/explore?ds=z8o7pt6rd5uqa6_...
You can easily find dozens of countries with at will employment, and high unemployment.
And I think, Spain has actually less stringent worker protection laws than Germany.
No, not at all
The US has spent the last 65 years chipping away at unionization rates and other pro-employee protections. The overall rate of unionization in the US peaked in 1954 [1].
[1] http://www.dollarsandsense.org/archives/2011/0311reuss2.html
Would a person getting that treatment from you quit for a job where 10% of people got fired after the first month?
However, things can go too far in the other direction. Imagine a small business having to spend months and months trying to fire someone who isn't doing their job and hasn't been receptive towards coaching or critiques. This could seriously harm the team they work on, not to mention the overall health of the company.
I don't know what the best solution is. But there are some complexities here.
Thinking about it more, I suppose I've also had this implicit assumption that at-will employment has contributed to the disproportionate success of startups in America. It seems like it could be the case, but I don't have any hard evidence.
There is the federal WARN Act (1) but it has holes big enough to drive a train through (natural disaster and unforeseeable circumstance exclusions mean it doesn't apply right now).
As the sibling noted, potentially the most devastating impact of the jobless claims is loss of medical insurance. We'll likely see tens of thousands of personal bankruptcy filings as a result of this pandemic, many of which will be due to ER/ICU bills.
1 - https://en.wikipedia.org/wiki/Worker_Adjustment_and_Retraini...
I also know that people can use COBRA to keep their employer's insurance if they're laid off, but often this can be too expensive. But are they able to get a new insurance plan or do they just not have insurance if they don't keep their employer's insurance?
I get it that people will have other medical issues during this time. But whether it covers Coronavirus related-expenses makes a HUGE difference. Coronavirus is BY FAR the leading cause of hospitalization in the US right now. It's also the leading cause of death. For a month, it's likely to get exponentially worse. It's likely to remain this bad for 2-3 months minimum.
Meaning, the costs could be astronomical, and as you pointed out, would DESTROY people not covered by insurance. This could honestly be almost as bad as the Subprime housing crisis. Something like 800k people filed bankruptcy from Subprime. Conservatively, we're likely to see 500k semi-severe hospitalizations. If 30% of them are unemployed, I don't know how that doesn't lead to 150k bankruptcies.
YMMV, but I would say that's on the conservative side.
Better mobility and ability to create and destroy has costs and benefits.
The implied "why" would be a more fluid workforce. We've all heard the horror stories of companies/industries/nations paralyzed by an unmotivated/unproductive workforce. Hell, we have the same jokes here about jobs in some government agencies and big corporations.
The thought is "quick to hire, quick to fire".
I don't mind it; I just think the situation where you lose your job AND your health care is insane.
I'd like a stronger social safety net.
On the other hand, perhaps countries with a stronger social safety net make it harder for companies to fire, so they push the burden back on the companies to keep from stressing social services.
"At-will employment" might be a US legal concept, but it's everywhere in Asia.
A few first-world economies (like Singapore, where I'm at; perhaps Hong Kong too) have similar (or less) employment protection to keep their reputations as "business-friendly" countries.
Edit: and if you downvote me without a response, you are a coward.
1.) "3000%" - Let's calculate the highest possible number to use here!
2.) "% jump" - Let's only consider the increased aspect of the jobless claim ratio!
3.) "jobless" - Let's not point out that most of these people will be immediately back to work shortly!
4.) "devastated" - Let's find the most dramatic verb to use here!
5.) "US" - Let's only focus on the US, since that allows us to use the highest possible number in #1!
6.) "has" - Let's use an auxiliary verb that implies the ensuing claim has already occurred, when it hasn't!
7.) "has devastated the US job market" - Let's make a sensational claim that not only isn't measurable, but hasn't had enough time to play out yet, so therefore isn't true!
I could probably do this for 90% of articles coming from CNN. It's not just about the clickbait, it's about what they're choosing to report on, and how they are framing it.
I think many of these workers are laid off so they can get unemployment benefits, and they'll be hired again by the same companies as soon as the quarantine ends - which should take a couple month if we look at what happened in China.
Sure, some companies will die from losing all of their business during the quarantine, but the number of jobless claims is not representative of the workers who will still be out of a job after the quarantine.
We may also be looking at permanent changes in behavior. Sure, there is a lot of pent up demand for getting out and socializing, but if people are being bled dry by meager stimulus checks, they're not going to rush to fill the restaurants and malls when this is over.
Edit: Just saw this, an interview with El-Erian on liquidity issues, https://www.youtube.com/watch?v=MjzBKtVTdtQ
And there's no way the economy will fully reopen before at least a year. China is not a good comparison, because 1) the US did not follow the same approach as China in dealing with the virus, 2) China has been lying about their economy and number of cases and 3) even if China was fully open for business now, the biggest markets are not buying - Europe and the US are just beginning a huge recession, that in turn will hit China back and will affect the recovery of the world economy.
A V shaped recovery is, in my opinion, a made up dream to keep people from panicking.
But just like before, it's "subject to status".
Which roughly means, if you really need it, the answer is no.
On the contrary, so far it appears US cases will peak much higher and later than in China, and a lack of resources at the state and local level will massively slow any subsequent recovery.
The best numbers I've seen for projecting US cases and deaths honestly seem to be pretty good:
https://covid19.healthdata.org/projections
This projects less than 100k deaths in the US this year. Compare that to heart disease (largely preventable) at 650k a year. That'd also make it only about 5 times worse than a bad flu year. (Edit: thanks for the correction below; if correct, this would be only about 2 times worse than a bad flu year.)
Compared to the millions of people dead in the US that many were projecting just a few days and weeks ago, this is indeed good -- in fact, very good, because it seems many fewer people will die.
Also, that 100,000 assumes everyone in the country follows proper physical distancing, hand washing, etc. Last I checked, the state of Florida is still allowing for church services during their "lock-down".
It's true the administration could have acted sooner. It's also true the opposite party was smearing 'racism' and 'xenophobia' even as shutting flights down was obviously the right move. This is not a scenario where any politician can claim to have done better.
In fact, world-wide we have seen a variety of responses, with no definitive answer on what has been good and what has been bad. It's a horrible situation for any national leader.
As to the number of dead.... it is what it is. Is it good? Certainly not. Could it be worse? Certainly. Does anyone have all the optimal answers. Certainly not.
We’re in “virus time” now and there will not be an end until a vaccine is manufactured and distributed.
On again off again quarantines are now ‘normal’.
Best way to guage the toll is take a glance at deaths in 2019 vs 2020 and the difference is covid-19 related. Even if it's a heart attack who couldn't get into the ER because it was full...etc..
Also some people are out of the ICU (at least in France) and will have to do 3 to 6 month of reeducation for the best cases. For the worst cases (still in ICU at the moment, at least in Colmar), its 20 years shoved off (lung fibrosis), one of them is younger than me. I guarantee you lethality might be what we're talking about now, but next year it will become secondary.
This is shittier than i thought.
People who believe the data coming from China is accurate are ignoring the recent history on transparency around this disease from the CCP. I just don't understand it. Sure, the country where police arrested the first doctors to publicly state it was human to human transmissible is being completely honest. Wow.
Two things can be true at the same time: Trump administration has done poorly AND the CCP is culpable, lying, and made the situation much worse.
But in the US political system, there is no tolerance for distraction from hating the opposition party. You can only blame Trump, and saying bad things about China is "just racist and mean. They did such a great job, they say they have contained it. We didn't because the bad orange man didn't do his job."
Yeah, meanwhile, those of us living in reality know that Trump and the CDC/FDA suck, AND the CCP does too. And yeah, maybe, just maybe, if the US news media had dedicated 1/20th the coverage they gave to the impeachment to the virus, the government would have been held accountable to start acting then. I was travelling internationally, and when I got back home in early February, I was shocked at how little CNN and MSNBC were talking about the virus. Basically zero. And Fox only talked about it in the context of the impeachment distracting from it.
When governments fail, we hope that the free press will hold them accountable, and there's no reason they couldn't have done that earlier. No, the red vs. blue team sports are just too good for ratings to talk about things that actually matter.
Remember how Trump was roundly criticized as 'racist' and 'xenophobic' for stopping flights? The Democrats have to own that one, their answers were flawed and would have cost lives as well.
But really-- nobody has all the optimal answers. War is hell.
Testing and social distancing were the steps that were needed on day one. They didn't happen fast enough and aren't happening fast enough.
It is not politicizing things to state the fact that his responses have been slow and poorly informed.
Hopefully, yes, although this turnaround has some unfortunate bureaucratic costs to both the employees and employers. I hope those small-medium business loans work for keeping a reasonable number of people on payrolls. While the administration of those loans has its own potential pitfalls, in some ways it seems like the better path than leaning on the unemployment insurance system.
That is highly doubtful. Many companies can't survive even 2 months of inactivity and will fold.
>which should take a couple month if we look at what happened in China.
China is undergoing a second wave right now [1] due to unlocking quarantine too early. It's extremely likely that they will be undergoing a second lockdown. Anecdotally, speaking to a lot of my friends in NYC most everyone who is currently WFH (myself included) isn't planning on returning back to the offices until at least the end of the year. Realistically, I think we won't fully get rid of lockdowns until vaccine is available and 80% of the population is vaccinated.
[1] https://www.bloomberg.com/news/articles/2020-04-02/chinese-c...
The downright dreadful forecasts coming in about 2020 GDP double digit declines seem to me to warrant a larger decline in equities.
I think a lot of folks think this will be a sharp V recovery, but I'm not so sure. I'm already seeing knock-on effects in the real world. People in tech being laid off; (formerly) rich folks cutting way back on planned spending; entire projects canceled, etc.
This is our new reality until a vaccine is manufactured and distributed.
GDP growth declined -0.1% in '08 and -2.5% in '09
This does seem to be accelerating, although recall that this year opened with a fair few headline-grabbing mass layoffs. It's hard to say that more weren't already coming, with the timetable just moved up.
1) A large portion of equity is held by large funds, which may be contractually unable to pull out of the equity market at all.
2) Lots of people are in it for a short term bump based on stimulus expectations
3) Most investments are made with a longer time horizon than the immediate pain of the short term, and thus, have no reason to sell now.
I think this could be an excellent rare economic data point to suggest the efficient market hypothesis does not work anymore (trumped by behavioral economics issues).
The reason the market didn’t tank today is because this jobs report was already priced in.
- Emerging markets, Japan, and Euro also being hit by the virus. Where else will capital flow?
- International bond markets selling off as credit risks rise removes bonds as the traditional flight to safety (US Gov Bonds being the notable exception).
- Strong US dollar vs. other world currencies gives international capital extra safety when parked in U.S. stocks.
- Large-cap U.S. equities such as those in the S&P 500 can generally weather short-term liquidity shocks like this, and if anything they will grow by absorbing the market share of failing small businesses.
While I agree in principle that the markets are trying to price in the downturn, I genuinely don't think that the median-dollar-investor abstraction really has a clue how long this is likely to last.
They are also kind of shocked that stocks are not plummeting and saying the market is rigged. Seems like a lot of people have been buying PUT options expecting the market to crash soon.
Reddit's investors haven't been known to be the a) smartest investors, b) most savvy investors, or c) adult humans.
https://www.oaktreecapital.com/docs/default-source/memos/whi...
TL;DR: markers are pricing in a V shaped recovery in a couple of months
So I would like to rephrase your question - what kind of permanent change do you expect in our society due to COVID-19?
While they are not technically buying stocks, every dollar of paper they buy from primary dealer inventory is a dollar that managers will find a home for.
The horrific employment news portends the need for the Fed to make $90B/day look like amateur hour in the near future. Hence, the run up in basically every single asset class today.
Understand that in an era of perpetual debt monetization, silly things like P/E multiples, employment, or earnings growth don't anchor stocks. Infinite liquidity combined with fund managers with a fetish for yield, no matter what the risk, are the only relevant mechanism in town. It's entirely possible to simultaneously have DJIA at 50,000 and half-mile-long lines for soup kitchens in this environment.
Layoffs being permanent job losses.
Furloughs expecting to go back to work when the social restrictions are lifted.
A lot of these are people taking advantage of state unemployment insurance, but who expect to return to work in the next few months.
It's also unclear, once things open up again, whether people will spend like they used to or whether the loss of potential customers' paychecks will add to the pain of small businesses.
I'm also curious how much it really helps health (and maybe even financial health) overall. Real home cooking is good compared to burgers and fries. But frozen pizzas are not great compared with some healthier restaurant options. And some restaurant food is pretty cheap and some packaged food surprisingly expensive.