with Brent D. Griffiths

Americans overwhelmingly believe the economy is in bad shape. But most are more concerned the lockdowns induced by the coronavirus will lift too early, allowing the disease to resurge, than they are about prolonging the economic damage in the meantime.

That finding comes courtesy of a new Wall Street Journal-NBC News poll: 58 percent of respondents said they are worried the United States will lift restrictions too quickly, while 32 percent said they are more concerned the restrictions will last too long.

President Trump lines up with the minority sentiment: He is encouraging and defending protesters who have gathered outside state government buildings to oppose the strictures. A plurality of Republicans do, too. By 48 percent to 32 percent, Republicans say they are more worried about keeping the economy on ice.

The survey revealed a country in a dark mood. 

People are absorbing the twin menaces of the pandemic and the economic shock it has brought with it. More than three-quarters of Americans now say the economy is in fair or poor condition; nearly as many say they are very or somewhat worried they or someone in their immediate family will contract the virus. No surprise then that 77 percent also say the pandemic has had a significant impact on their day-to-day to life.

The poll's findings back up other recent surveys. “In a poll released Thursday by the Pew Research Center, three-quarters of U.S. adults said the worst is yet to come with the coronavirus and two-thirds were worried that restrictions would be lifted too soon,” Ashley Parker writes. “And findings released Friday by the University of Michigan’s influential monthly consumer survey found that 61 percent were most concerned by the threat to their health from the virus, over isolation and financial impact.”

And while Trump’s approval rating remains largely unchanged from pre-pandemic, with 46 percent approving and 51 percent disapproving, only 36 percent trust what he says about the coronavirus.

Most Americans want Washington to do more. 

As the Trump administration and Congress approach an agreement on a roughly $470 billion package of new economic relief, more than six in 10 respondents indicated the federal government needs to do more to ensure adequate testing and secure medical supplies for doctors and nurses. By roughly that margin, they approve of Washington taking a bigger role in the economy as it responds to the crisis. 

“At the same time, 48% expressed concern that the U.S. was spending too much and would drive up the deficit, while 40% said the bigger concern was that the government would spend too little and prolong the economic downturn," the Wall Street Journal's Catherine Lucey writes. “Republicans were particularly concerned about spending, with 60% worried that the government would spend too much, compared with 29% who worried about too little spending. Among Democrats, those shares were essentially reversed.” 

Most think the restrictions won’t lift for months. 

More than three in four Americans think a reopening of the economy and a “return to normal” are at least months away, not weeks, according to the survey. 

Many economists agree. “Despite [Trump’s] initial hopes for a ‘Big Bang’ reopening, it’s becoming clear that, when shutdowns are eventually eased, this will be done in a gradual and phased manner,” Capital Economics chief economist Neil Shearing writes in a note. 

And Pantheon Macroeconomics chief economist Ian Shepherdson notes, “Unfortunately, three of the highest-income states with large populations—New York, New Jersey and Massachusetts—have very high infection rates, and case growth is uncomfortably high. The re-opening of the economy in these states necessarily will be slow and gradual." 

"By contrast, the two most populous states in the country, California and Texas, have much smaller outbreaks, likely in part because population density is much lower than in the Northeast and use of public transportation is far lower. These states will be able to re-open much sooner, but even here we think talk of a quick return to full normality seems fanciful.”

Money on the Hill

Both the White House and congressional leaders say a small business deal is close.

Trump says they are “close to a deal”: “The Trump administration and congressional leaders closed in Sunday on an approximately $470 billion deal to renew funding for a small-business loan program that ran out of money under crushing demand during the coronavirus pandemic, aiming to pass the agreement into law within days,” Erica Werner and Jeff Stein report.

“The deal would also boost spending for hospitals and coronavirus testing by about $100 billion. Trump expressed optimism Sunday evening about clinching an agreement by [today] … In a further sign of progress, House Majority Leader Steny H. Hoyer (D-Md.) notified House members Sunday evening to be prepared to return to the Capitol on Wednesday to vote on the emerging agreement.”

  • The details: “About $310 billion to the Paycheck Protection Program for small businesses, which was swamped by demand in the three weeks since Congress created it as part of a $2 trillion coronavirus rescue bill. It also would add $60 billion to a separate emergency loan program for small businesses that is out of money, too, Senate Minority Leader Charles E. Schumer (D-N.Y.) said on CNN."
  • It would also address some major Democratic demands: “$75 billion for hospitals and $25 billion for testing … Some $60 billion in the new funding for the Paycheck Protection Program would be targeted specifically for smaller financial institutions to ensure loans for minority and lower-served areas, said people familiar with the plan who spoke on the condition of anonymity to describe it."

Coronavirus fallout

In the U.S.:
  • The death toll passed 40,000: 40,683 people have died and at least 759,000 cases have been reported, per The Post's count.
  • Trump says there will be more federal help for testing, after governors speak out: “Republican and Democratic governors were unanimous in putting the onus on the federal government to help secure vital testing components, including swabs and reagents, the chemical solutions required to run the tests, which the governors said have been in short supply,” Shane Harris, Felicia Sonmez and Mike DeBonis report.
  • The president says he twill use the Defense Production Act for swabs: “He provided no details about what company he was referring to, or when the administration would invoke the act. And his aides did not immediately respond when asked to provide more details,” the New York Times reports.
  • Pro-gun activists use Facebook to promote protests: “A trio of far-right, pro-gun provocateurs is behind some of the largest Facebook groups calling for anti-quarantine protests around the country, offering the latest illustration that some seemingly organic demonstrations are being engineered by a network of conservative activists,” Isaac Stanley-Becker and Tony Romm report.
Corporate impact:
  • Walmart struggles to stay open: People are turning to the supermarket giant, the nation's largest employer, like never before. The company has responded by hiring 150,000 people with plans to hire 50,000 more. At the same time, Walmart has had to put 10 percent of its workforce on leave and 18 employees have died as its executives debate how to best protect their employees and shoppers in its stores, the WSJ's Sarah Nassauer reports.
  • Neiman Marcus may file for bankruptcy as soon as this week: The Dallas-based company is “becoming the first major U.S. department store operator to succumb to the economic fallout from the coronavirus outbreak, people familiar with the matter said,” Reuters's Mike Spector and Jessica DiNapoli report.
  • 24 Hour Fitness mulls bankruptcy: “Gym chain 24 Hour Fitness is working with advisors at investment bank Lazard and law firm Weil, Gotshal & Manges to weigh options including a bankruptcy that could come as soon as the next few months, people familiar with the matter tell CNBC,” Lauren Hirsch report. “The chain is grappling with a heavy debt load, deteriorating performance and a coronavirus pandemic that forced it to shut its more than 400 clubs.”
  • Facing backlash, Shake Shake says it will repay its $10 million loan. The burger chain was one of more than a dozen publicly traded companies with revenue over $100 million to secure a forgivable loan intended for small businesses, Bloomberg found. ““We’re thankful for that and we’ve decided to immediately return the entire $10 million PPP loan we received last week, so that those restaurants who need it most can get it now,” the company's top executives said in a statement. 
  • Beer, soda and seltzer face CO2 shortage: “Brewers and soft-drink makers use carbon dioxide, or CO2, for carbonation, which gives beer and soda fizz. Ethanol producers are a key provider of CO2 to the food industry … But ethanol, which is blended into the nation’s gasoline supply, has seen production fall sharply due to the drop in gasoline demand as a result of the covid-19 pandemic,” Reuters's Stephanie Kelly and Lisa Baertlein report.
  • Wynn Resorts CEO calls for Strip to partially reopen next month: “Wynn Resorts Chief Executive Officer Matt Maddox … called on the Nevada governor to begin to reopen the Las Vegas Strip in mid- to late May with extensive safety measures in place, assuming the state is in line with certain benchmarks around the spread of the coronavirus,” Reuters's Helen Coster reports.
Around the world:
  • Unrest points to new phase: “Already, protests spurred by the collapse of economic activity have erupted in scattered locations around the world. Tens of thousands of migrant laborers stranded without work or a way home staged demonstrations last week in the Indian city of Mumbai, crowding together in defiance of social distancing rules,” Liz Sly reports from Beirut.
  • Europe begins to cautiously reopen: “Denmark and the Czech Republic will reopen smaller stores on Monday, while Norway is allowing children back into kindergartens and Poland will make parks and forests accessible again. The euro zone’s biggest economy, Germany, is also set to reopen many non-essential businesses, including car dealers, book stores, zoos and electronics retailers -- but restaurants, bars and most larger stores will remain closed,” Rick Noack reports from Berlin.
  • South Korea relaxes social distancing rules: “South Korea is one of the first countries in the world to buck the global trend of virus-driven lockdown and lift closure orders on high-risk venues like churches, bars and sporting facilities,” Min Joo Kim reports for Seoul.
  • Australia will force Google and Facebook to share profits with news companies: “Amid a devastating decline in newspaper ad revenue, Australia intends to force Facebook and Google to share profits with media outlets, the country’s treasurer said,”  Antonia Farzan reports,

Market movers

Oil prices are crashing to new lows. 

A supply glut is weighing on the commodity: “Oil plunged below $15 a barrel in New York, a fresh 21-year low, as inventories soar because of the supply-demand mismatch that’s been created by the coronavirus,” Bloomberg's Elizabeth Low and Alex Longley report. “The most immediate West Texas Intermediate contract fell as much as 22% to $14.19 a barrel. While a major part of the slump is because the May futures contract expires on Tuesday, the collapse nonetheless reflects a fast-growing glut of oil, and rapidly expanding stockpiles in Cushing, Oklahoma, the American pricing hub… 

“Buyers in Texas are offering as little as $2 a barrel for some oil streams, raising the possibility that American producers may soon have to pay customers to take crude off their hands, particularly as landlocked producers struggle to find homes for their oil.”

Traders continue to bet against the market amid a wild year.

These are some of the most aggressive positions taken in years: “Bets against the SPDR S&P 500 Trust, the biggest exchange-traded fund tracking the broad index, rose to $68.1 billion last week, the highest level in data going back to January 2016, according to financial analytics company S3 Partners. That was up from $41.7 billion at the beginning of 2020 and $41.2 billion a year ago,” the WSJ's Karen Langley reports.

“Short sellers borrow shares and sell them, hoping to repurchase them at lower prices and keep the difference as profit. Among the individual companies they have targeted in recent weeks are travel-related firms, including Carnival Corp., Royal Caribbean Cruises Ltd., Marriott International Inc. and Wynn Resorts Ltd … Investors are bracing for the possibility of more volatility this week, as earnings reports from companies including Coca-Cola Co., Netflix Inc. and Delta Air Lines Inc. give another glimpse at how the coronavirus is reshaping the landscape for U.S. business." 

S&P 500 companies will slash spending by a third, Goldman predicts. “We forecast S&P 500 cash spending will decline by an annual record 33% during 2020 as firms prioritize liquidity in a worsening economic environment. Capex will decline by 27%, R&D by 9%, and cash acquisition spending by 49%, leading to a 26% plunge in investment for growth,” the firm writes in a note. “Buybacks and dividends will also decline sharply in 2020, falling by 50% and 23%, respectively.” 

Blue chips rallied 2.2 % this week despite a parade of grim news such as soaring claims for unemployment insurance and plummeting retail and industrial activity. There are several explanations for this dichotomy.
WSJ

Campaign 2020

Trump campaign concludes eliminating Biden is better than touting the president.

Not everyone in Trump world agrees with the move: “The decision by top campaign advisers, which has met pushback from some White House officials and donors, reflects polling showing a declining approval rating for Trump among key groups and growing openness to supporting Biden in recent weeks, according to officials familiar with the data who spoke on the condition of anonymity to discuss internal deliberations,” Michael Scherer, Josh Dawsey, Annie Linskey and Toluse Olorunnipa report of efforts to tie former vice president Joe Biden to China.

“The shift represents a remarkable acknowledgment by aides to a self-described ‘wartime president,’ leading during what might have been a rally-around-the-flag moment, to ­effectively decide it is better to go on the attack than focus on his own achievements. Campaign polling found more than three-quarters of voters blamed China for the coronavirus outbreak, underscoring the potential benefits of tying the presumptive Democratic nominee to ­Beijing. The planned China push, which has already been embraced by pro-Trump outside groups, comes as both the Trump and Biden campaigns have been anxiously recalibrating their plans in response to the most catastrophic economic and health crisis in the United States in generations.”

Trade fly-around

Trump postpones some tariff payments. 

The move was expected — and falls short of what some business groups wanted. “Under a rule announced by the Treasury Department and U.S. Customs and Border Protection, companies must first ‘demonstrate a significant financial hardship’ and show they were affected by government orders halting business activity,” Teo Armus reports. “Those who qualify can delay paying tariffs — essentially, taxes collected at the border — on certain goods coming into the U.S. in March and April for 90 days. Importers will not have to pay interest during this period… 

"Trump’s special tariffs on steel and aluminum imports and Chinese goods were excluded from the measure, as were other punitive tariffs on dumped and subsidized products."

Chart topper

From LPL Financial's Ryan Detrick: 

Daybook

Today:

  • Equifax and Halliburton are among the notable companies reporting their earnings, per Kiplinger

Tuesday:

  • Coca-Cola, Netflix, JetBlue Airways, Travelers, Revlon, Phillip Morris International and Snap are among the notable companies reporting their earnings

Wednesday:

  • Biogen, Quest Diagnostics,  AT&T, Delta Air Lines, O’Reilly Automotive, Spirit Airlines, Discover Financial Services, Las Vegas Sands, Boston Beer and Alcoa are among the notable companies reporting their earnings

Thursday:

  • Eli Lily, Southwest Airlines, Domino's Pizza, Aaron's, Union Pacific, Intel, Blackstone and Capital One Financial are among the notable companies reporting their earnings

Friday:

  • American Airlines, Verizon, Goodyear Tire and American Express are among the notable companies reporting their earnings

The funnies

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Bull session