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Fed: coronavirus could mean 47 million laid off, 32% unemployment rate

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  • More than 47 million Americans could lose their jobs in the second quarter amid the coronavirus pandemic, sending the unemployment rate to 32%, according to a recent study from the Federal Reserve Bank of St. Louis.
  • In a previous analysis, the Fed estimated that nearly 67 million Americans work in occupations that are at high risk of layoffs due to social distancing measures.
  • The study was released just before weekly jobless claims data released Thursday showed record layoffs in the week ending March 21.
  • Visit Business Insider’s homepage for more stories.

Unemployment could skyrocket to a record high as the coronavirus pandemic puts millions of Americans out of work, according to a study from the Federal Reserve Bank of St. Louis. 

As many as 47 million Americans could be subject to layoffs in the second quarter, which added to the amount laid off in February would mean 52.81 million people unemployed. That would send the unemployment rate to a massive 32% according to the study published March 24. 

“These are very large numbers by historical standards,” wrote Federal Reserve Bank of St. Louis economist Miguel Faria-e-Castro in a blog post about his “back of the envelope” calculations for the labor market going forward. “But this is a rather unique shock that is unlike any other experienced by the US economy in the last 100 years.”

The US unemployment rate in February was 3.5%. If it surged to 30% in the second quarter, it would top the highest rate on record of nearly 25% during the Great Depression. 

Read more: 200-plus money managers pay thousands to see which stocks are on Jim Osman’s buy list. Here are 3 he says are set to soar ‘at least 50%’ from their coronavirus-stricken levels.

The study came just before weekly US jobless claims data released on Thursday spiked to a record 3.28 million for the week ending March 21. The weekly report of Americans who had filed for unemployment insurance was one of the first indicators of just how bad the coronavirus pandemic could be.

Faria-e-Castro began his analysis working from a previous Fed report that nearly 67 million Americans work in occupations that are at high risk of layoffs due to social distancing measures, such as those in sales, production, and food services. Another report also accounted for 27.3 million workers in contact-intensive positions such as barbers, hairstylists, and flight attendants, who may be at risk during the outbreak.

Read more: UBS outlines 3 major investing themes the coronavirus crisis is shaping today — and breaks down how they’ll play out in the years to come

Faria-e-Castro averaged the two groups for an estimate of 47 million layoffs in the second quarter. He said that there are a number of caveats to his analysis. First, he did not include those who might be discouraged and not seeking another job, thus lowering the unemployment count in the second quarter.

He also said that businesses may send workers home with pay instead of laying them off. In addition, his analysis did not include the impact of any government stimulus recently passed, which will support small businesses and expand unemployment benefits. 

Still, it’s expected that weekly jobless claims will continue to be elevated at never-before-seen highs as coronavirus-induced layoffs persist. In addition, a majority of economists are forecasting a US recession this year, which could become a depression if the coronavirus pandemic worsens.

Read more: Stocks are trading like they did early in the financial crisis — and it’s proof to one Wall Street equity chief that the coronavirus crash will worsen

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Everlane’s $150 drape trench coat is my spring outerwear staple jacket

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Everlane trench coat



Everlane


  • There’s rarely a work day you won’t find me wearing at least one article of clothing from Everlane.  
  • Everything the company makes, from its $118 Day Glove flats, to its $68 Authentic Stretch skinny jeans, to the $148 Modern Trench Coat, is responsibly made, reasonably priced, and great quality. 
  • The Modern Trench Coat looks like it should cost a lot more than $148 — Everlane says traditional retailers would probably sell the coat for $335.
  • It’s been my go-to spring jacket for three years and I still get compliments on it all the time. 

A few years ago, I was looking to add a classic khaki trench coat to my closet. It’s one of those staple pieces that goes with everything, and it’s the perfect weight for New York City springs … which are unpredictable at best. But I didn’t want to spent a lot of money on one. 

I’d come to rely on the direct-to-consumer brand Everlane for its affordable and modern basics, so when the company introduced a trench coat to its site, I knew I wanted to try it. It was the right price at $148.

The Everlane Modern Trench Coat has a slightly longer, more relaxed fit than traditional options, but it still has a super-classic look.

Everlane trench coat



Everlane


The trench coat is made of 100% cotton twill and comes in khaki, black, or navy. The material has a water-resistant finish and the design includes a storm flap that ensures water doesn’t slip into the jacket as it runs down the shoulders — after all, it wouldn’t be a good spring jacket if it wasn’t rain-friendly.

I was worried the oversized silhouette that looked chic on Everlane’s 5-foot-10 model would drown my 5-foot-3 frame, but once I took it out of its packaging and put it on, all my concerns were gone. It’s longer on me than the model in the pictures, but I don’t look childish in it since it fits my shoulders and its waist lines up perfectly with my own. The coat falls a few inches past my knees, creating a flattering midi length that Everlane probably didn’t intend, but that I quite like. 

Read more: 11 San Francisco-based clothing startups that prove New York City isn’t the only capital of fashion

Everlane trench coat



Everlane


In a traditional retail setting that accounts for various forms of markup, Everlane estimates that the Modern Trench Coat would cost $335. But at $148, it’s a total bargain.

Three years later, I still get compliments and “Where’s your jacket from?” questions from coworkers and total strangers on the subway all the time. When I reply, “It’s from Everlane!” anyone who is already familiar with the company is never surprised. We’ve all come to expect only the best quality from the direct-to-consumer darling. 

Do your closet a favor and add the $118 Day Glove flats (8 colors) and a pair of $68 Authentic Stretch skinny jeans (6 washes) to your cart while you’re at it for an effortless and timeless spring look. We can be outfit twins!

If Everlane has taught me one thing, it’s that spending more money on clothes doesn’t always means you’re getting better quality. 



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Ex-State Department IG confirms investigations into Pompeo’s conduct

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  • Former State Department Inspector General Steve Linick confirmed in an interview with members of Congress that his office was investigating matters involving the conduct of Secretary of State Mike Pompeo.
  • According to the transcript of the interview, shared by BuzzFeed News’ Jason Leopold, Linick and his office were looking to allegations that Pompeo and his wife were misusing government resources for personal errands.
  • Linick’s office was also investigating Pompeo’s “emergency” declaration to push billions in weapons sales to Saudi Arabia and other countries, citing the transcript.
  • Visit Business Insider’s homepage for more stories.

The State Department watchdog who was fired last month by President Donald Trump confirmed his office was looking into matters involving Secretary of State Mike Pompeo’s conduct, BuzzFeed News’ Jason Leopold reported Wednesday.

Former State Department IG Steve Linick was suddenly ousted by the president in mid-May, despite the requirement to give Congress 30-day notice before removing an inspector general. Trump claimed he “didn’t know anything” about Linick’s firing.

Linick told members of Congress in an interview that at the time of his firing, there was an ongoing investigation into allegations of misuse of government resources by Pompeo and his wife.

NBC News reported that Linick’s office was looking into whether Pompeo tasked a staffer with his personal errands, like walking his dog and picking up his dry cleaning.

Linick said his office requested documents in relation to the investigation from Pompeo’s office, and that Linick personally spoke to Under Secretary of State for Management Brian Bulatao and Deputy Secretary of State Stephen Biegun about the investigation. Pompeo previously denied knowledge of the investigation in an interview with The Washington Post.

Linick’s office was also reviewing Pompeo’s “emergency” declaration to push billions in weapons sales to Saudi Arabia and other countries, according to the transcript of the interview.

In the interview with members of Congress, Linick said he was “shocked” by his ouster, and that it came without any warning from Trump or Pompeo. He added that any public justifications offered by Pompeo and other officials for his firing were “either misplaced or unfounded.”

“I have not heard any valid reason that would justify my removal,” Linick said.

 





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Trump campaign struggles to find coherent strategy during protests

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  • President Donald Trump and his campaign have yet to find a strong strategy for addressing the massive nationwide protests against police violence.
  • Trump and his campaign have ping-ponged between messages focused on shoring up his base in the  Christian right and attacking former Vice President Joe Biden to siphon his support among black voters.
  • Current and former advisers describe a campaign that was beleaguered even before the protests engulfed the country, and it has only gotten worse since then.
  • A 2016 Trump aide said the president’s Monday visit to St. John’s Church was a missed opportunity. “He should have gone over there and inspected the damage, or if he was going over there with a Bible, he should have prayed,” the person said.
  • Visit Business Insider’s homepage for more stories.

President Donald Trump and his campaign are struggling to find a coherent strategy with the clock ticking toward Election Day. 

That’s the takeaway from interviews with a half-dozen members of the president’s circle of loyalists who see a reelection effort tossing out different messages by the day in a struggle to regain the narrative amid the double whammy of the coronavirus pandemic and nationwide protests over the Memorial Day death of George Floyd while in police custody in Minneapolis.

It’s been a whirlwind 72 hours, even by Trump standards. The president has ping-ponged between a focus on his piousness, attacks on Joe Biden’s lengthy record with African Americans, and a promise he is the “law and order president” akin to Richard Nixon’s successful 1968 bid for the White House. 

As the president hemorrhages support — his current and former Defense secretaries joined the list on Wednesday — people close to the 2020 campaign say they are frustrated at the lack of a clear strategy.

“They think they had a pretty good narrative until all of this happened,” said a Trump 2016 campaign adviser in touch with the re-election effort. “They want to recapture the narrative.”

Trump isn’t doing himself any favors

The protests over Floyd’s death hit just as Trump’s team was finding its footing after a rocky two months since the start of the coronavirus pandemic. 

Jared Kushner led an overhaul inside the campaign last week, installing former White House political director Bill Stepien as it’s new de facto campaign manager. And campaign aides have been talking up how to get Trump back to his in-person campaign rallies, possibly as soon as next month. 

But his focus on energizing his base has cost him support with the broader electorate. A Reuters/Ipsos poll released Tuesday found 64 percent of Americans surveyed were “sympathetic” to those protesting police violence and Floyd’s death. The poll found that 55 percent of respondents disapproved of Trump’s response to the protests. 

Trump hasn’t done himself any favors.

Consider his trip to St. John’s Church on Monday and then to the St. John Paul II shrine on Tuesday. The president’s goal in the two Washington D.C. outings was to showcase his ties to the conservative Christian base and appeal to suburbanites and independents with his “law and order” proclamation. 

But the forceful removal of protesters camped outside the White House by federal police instead drew criticism from across the political spectrum, including an admonition from famous televangelist Pat Robertson. 

On Wednesday, Trump tried another tactic. He pivoted to attacking former Vice President Joe Biden over his support for the 1994 crime bill that increased the number of minorities locked up across the nation while touting his support of historically black colleges and universities.

The aim: Undercut African American support for Biden, a critical demographic for Democrats if they’re going to win back the White House. 

But he stepped on his own message again as military troops for a third straight day cordoned off federal buildings from looters and activists protesting police violence against blacks in the wake of Floyd’s death.

PatRobertson

Pat Robertson criticized President Trump on Tuesday, saying he should be uniting and healing the country and that forcing out protesters “isn’t cool.”

Win McNamee / Getty Images


Priority No. 1: Keeping the Christian right satisfied

Trump’s walk to St. John’s Church, his advisers said, was also a nod to Christian right voters, one of the biggest groups the president must hold to win in November. 

But the trip, which the White House memorialized with a campaign-style video, drew criticism from a cross section of religious figures, from Robertson to the bishop of the Episcopal Diocese of Washington, which oversees St. John’s Church, and the Catholic archbishop of Washington, D.C.

The former Trump adviser said those complaints can be brushed off easily because the church leaders are left of center and Robertson has lost a step with the Christian right during the Trump era to leaders like Franklin Graham. But there is still a widespread recognition the president needs to do more to keep the Christian right happy.  

“I thought going over to the church was a good idea, it showed he wasn’t locked in the basement,” the former adviser said. But this person also complained that the quick trip didn’t get executed well. 

“He should have gone over there and inspected the damage, or if he was going over there with a Bible, he should have prayed,” the 2016 Trump adviser said.

‘Casting doubt’ on Biden’s record with African Americans

Trump advisers have also been urging him for months to launch the kind of attack that he leveled Wednesday on Biden over his support of the 25-year old crime bill. The goal is to both peel away some of the presumptive Democratic nominee’s African American support— or just depress turnout from the demographic come November in critical battlegrounds like Michigan, Pennsylvania and Wisconsin.

Earlier Wednesday, Trump signaled the pivot away from the religious focus (for now), tweeting “In 3 1/2 years, I’ve done much more for our Black population than Joe Biden has done in 43 years.”

By contrast, Biden has made white supremacists’ support for Trump, and Trump’s own comments that white supremacists protesters in Charlottesville three years ago included some “very fine people”, a centerpiece of his campaign. 

Trump advisers have argued he should own policy victories for African Americans, like his signing of sweeping criminal justice reform legislation almost two years ago, and his work with Kanye West and Kim Kardashian West. 

“At the end of the day it’s not just about him winning their votes,” said Sean Spicer, the former White House press secretary who on Wednesday aired an interview with Trump for his new gig as the host of a nightly show on the conservative network Newsmax. 

“It’s also about him casting doubt about them voting for Biden. From that standpoint it can be effective,” Spicer added.

Donald Trump Jim Mattis

Former Defense Secretary James Mattis in a statement to the Atlantic published Wednesday said Trump was tearing the country apart in a style akin to the Nazis.


Chip Somodevilla/Getty Images



Trump adviser: St. John’s visit wasn’t intended for the blue coastal states

The focus on messaging “law and order” plays well to an important crowd of Americans who are angry at the looting and destruction of businesses that has often overshadowed the protests against police violence, Trump advisers tell Insider. 

“The president’s going to take action and stand up,” said a 2020 campaign adviser. 

She noted that Trump’s walk to St. John’s and clearing of the protesters wasn’t meant to appeal to people who live in blue states on both US coasts. The president instead was speaking to his supporters, including the business owners who’ve had their businesses looted. 

“If the media is going to be ridiculous against us and not get the pulse of the real people, he will go out and talk to them directly,” the Trump adviser said.

But Trump’s shocking law and order response to the protest nonetheless drew sharp criticism from even inside his most ardent supporters. 

Robertson said Tuesday that Trump should be uniting and healing the country, and that forcing out protesters “isn’t cool.” And Trump’s own defense secretary, Mark Esper, said he opposed sending in military troops and even said they could leave their posts — though he later reversed course following a meeting at the White House. 

Another startling response came from Trump’s former defense secretary, James Mattis, who said in a statement submitted to The Atlantic that Trump was tearing apart the country in a style akin to the Nazis. 

“‘Instructions given by the military departments to our troops before the Normandy invasion reminded soldiers that ‘The Nazi slogan for destroying us … was ‘Divide and Conquer,'” Mattis wrote.

“Our American answer is ‘In Union there is Strength,'” he continued. “We must summon that unity to surmount this crisis—confident that we are better than our politics.”

Paul Winfree, a former top deputy for domestic policy at the Trump White House and now with the Heritage Foundation, summed up the campaign’s problem as a straightforward one that leaves the burden on the president.

“Biden is not going to defeat Trump on policy,” he said in an interview. “Biden is going to defeat Trump on not being Trump. Trump knows that.” 



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