Larry Kudlow, the administration’s chief economist, said just last week that a “V-shaped recovery” was still on track. That’s what happens when you label someone like Larry Kudlow an economist. Kudlow, 72, is not an economist, even though he served as “chief economist” at investing firm Bear Stearns in the 1980s. Kudlow was a successful Wall Street salesman. In 2005, Kudlow, said that “bubbleheads” predicting real estate crashes in Las Vegas and Florida were “dead wrong.” Kudlow turned out to be dead wrong. An epic housing bust began right around that time, with gigantic losses in Las Vegas and Florida. In 2007, Kudlow wrote, “there is no recession.” In reality, a terrible recession began that very month.
Total non-farm payrolls are down by a net of 8.4 percent, the equivalent of nearly 13 million jobs, since the recession officially began in February. The U.S. unemployment rate is 10.2 percent, still higher than it ever was during the Great Recession. If you also include workers who are involuntary part-timers, people who have given up looking for work, and those who are still being accidentally misclassified as employed despite being temporarily laid off, the underemployment rate would be closer to 17.5 percent.
We definitely bounced upward quite sharply at first but growth across a range of economic indicators has tapered off. Business closures and layoffs that at first seemed temporary might be becoming permanent, as the country struggles to get the novel coronavirus under control and firms are forced to operate with fewer customers and higher costs.
Diane Swonk, Grant Thornton chief economist, says the need for another fiscal stimulus package is now a matter of “life and death.” She speaks with Bloomberg’s Tom Keene, Jonathan Ferro and Lisa Abramowicz on “Bloomberg Surveillance.”