Almost always open to see what you want to see in many ways economics remains in our however the Economic Situation sets us all now is much more than about our politics its about the way we will live for this foreseeable future are we witnessing a recovery if so what kind of. Discussing the economy and more im joined by my guest and you know what do you mark you know who she is and doubtless she is the c. E. O. And chief strategist for well intelligence a research and a little she is also be author of an insiders take on why the Federal Reserve is bad for america as well as they call mr Bloomberg View and in new york we cross to marshall is a researcher so. For the Levy Institute at our college and contributor to independent Media Institute as well as in member of america compass or a newly established think tank formed to restore an economic consensus into sizes the importance of Family Community and industry to the nations liberty and prosperity right across the rules in effect that means you can jump in if you dont want and i always appreciate ok let me go to our national 1st in new york last week we came up with a new job numbers and it was quite surprising for a lot of people that was a row of jobs approximately over 2000000 though there seems to be some all of the issues now which is kind of interesting in itself. Which gives people reason to believe that there is some kind of recovery and i would really would like in this program to be politicized that i dont want to talk about who whose advantage it is ok because that is turned into a political football and we meet you only with something that is the Great Depression so i think we have to take it very seriously so marshall i mean we in some kind of recovery or is it too early to same or recovery in some sectors and not others kind of you know unpack it for us you know without getting too political the look that the idea is if you if you go if you if you stop a car you know youre going 100 miles an hour then you stop the car and it goes to 0 and then you break celebrate and it goes 20 miles an hour of course you know the car is moving again and. So course thats progress but you are still far from seeing that automobile move operated at maximum efficiency so leaving aside this testicle ledge and there are there is problems about and im sure well get into that yes theres been some recovery but you are still dealing with some youve still got some profound long term structural issues which i think are far from degrees all. You know him its one of the things that you know a situation like the the very sudden because this was this was selfinflicted the kind of he was turned off it was a it was a a choice ok but as we come into this recovery if you know the word recovery is appropriate but it kind of reveals some of the structural problems that were in the economy in the 1st place and i think that thats something that we need to look at is well because i belong to lamented people talking about these really big Macro Economic numbers that doesnt really always tell you very much about the economy or like how the markets are in you know i mean you know you come out with you know these different various job reports and then the markets are are soaring and they seem so disconnected because it really doesnt have much to do with the average working family. You know thats exactly right and i think that the reason that the economy was kind of on a weak footing coming into this year is why weve had the rebound in the stock market that we have and that is that the Federal Reserve kept Interest Rates at artificially low levels for so many years that nonfinancial business debt in this country was allowed to double so it was an accident waiting to happen so to speak and once that accident did happen you know that the blackest of black swans then we saw a much faster underground following in the Corporate Bond market and what would have been expected and that was just it was just a by product of them being as over levered as they were which prompted the fed to ride to the rescue and do things that its never done such as get into the high yield bond market and rescue companies that have been downgraded which is set off what we call animal spirits the likes of which weve never seen now we have individual that theres this smallest of Retail Investors pumping up things like insolvent companies such as j. C. Penney and hertz that have actually declared bankruptcy filed for chapter 11 and yet investors in general are so convinced that because of the feds extraordinary actions to contain the outfall of the credit market of the credit bubble bursting that the fed no matter what happens is going to have their back with i mean thats like the fed choosing winners i mean is that really helped me through the economy because it again thats kind of been evolution i mean thats a choice its not really Market Forces as were always told to worship here i find that really quite bewildering and what is the doing if youre buying Corporate Bonds i mean this is this is its its not creating an even Playing Field how do you explain what the current one. What the fed is doing right now is credit allocation but what the end result is is the likes of price distortion the likes of which weve never seen it is almost impossible whether youre investing in a bond or a stock right now to say what its inherent underlying value is youve got 40 percent for example of the standard and poors 500. 00 its hold guidance all Earnings Guidance for the year so if youre talking about the most traditional valuation metric the price to earnings ratio its kind of undefined right now is so i mean were an absolutely extraordinary times and yet we have the markets at all time highs that is what that policy is creating and the irony is that you know corporations have tacked on an additional trillion dollars of debt in very short order and this is just going to make them that much weaker than they were coming into the year if we dont have a true the shaped recovery and i mean full day shaped recovery this is going to leave that sector that much weaker and more to one of the things thats coming to my mind one thing of the Financial Reporting is that its almost is if house the economy isnt necessary anywhere rob the people in the economy continue to move forward i find that really quite bewildering because again if you look at you know a lot of Financial News you know people are upbeat you know and of course you know you know. These major corporations that were bailed out 1st you know but that house they were not so i mean its like someone said to me rather just heard you think theyre back in the shower drinking wine the good part of the country doesnt feel that i mean if you have even more beer on the street i think thats right and to your point about the fed so i think the winners and losers i dont even think its winners and losers i think the fed is its whether youre politically well connected to the extent of the bailouts really have its a is a function of how well established craigs is doing. Banking relationships where which is why the programs like p. P. P. Have not worked out well because theyre a Small Business that employs say 15 people youre not going to have the same kind of relationships with with j. P. Morgan as a large Multinational Corporation will not that and thats no fault of. The banks per se i mean thats understandable but to your other point i mean i think been a long standing problem weve had a serious deterioration in the open all of who have jobs even as we were coming to full employment and i think thats been a longstanding problem its been brutally exposed the underlying. About a comic for a long period of time and as you point out this post Pandemic Response has actually exacerbated the problem its we instead of fixing it weve actually made it worse you know then you know its you know when people talk about a recovery i think its more germane to say recovery for home i mean thats really the question we have to ask because i think i know its easily politicized im not im im deeply conservative person and i can easily politicize it myself but you know the the issue is here is that we need to have a recovery it are the right people to be on the on the receiving end. And thats exactly right you know right now the narrative in the media is that Everything Associated with any of the pain of the corona crisis is temporary in nature there will be no hermant the consequences of what were seeing right now and yet we know that Small Businesses as they look to reopen. And for a generation now weve had Small Businesses focused on an unvaried a low price labor at the expense of Capital Expenditures now and in a world where so many consumers are going to be going to have anxiety about social distancing now youre going to have an opposite trend of Small Businesses looking to invest in Capital Expenditures and automate to a faster extent than they have kind of like the medium and Large Sized Companies in america have already certainly started that process youre going to actually have even the Small Businesses that employ 47 percent of americans prior to the current of the current of our Virus Outbreak youre going to have an even smaller segment of the population that is brought into and under the Small Business umbrella and which is a a made Huge Foundation and source of innovation and entrepreneurship that is traditionally been a job creation engine so im truly concerned about what the aftermath of this is going to look like you know martially with the with the jobs report that we got last week when were inside is that the economy what sectors of the economy you think that these jobs came from because again there was a lot of people have occasion about these numbers and i i kind of think that was politically influence but i mean they gave economy small d businesses which trying to Small Businesses or is it like this amazon just got another 100000 well to your point about the the problems with the numbers themselves if part of the difficulty ironically is that the that we have these new programs like the government Grant Programs whereby funding was extended to companies who kept on their payroll or sustain their payroll who duration of the crisis so when they they were in this anomalous position of being paid but they were doing anything and the. The b. L. S. At the end of its report indicated that these people were counted as employed about they are the facto unemployed so and if you actually made adjustments havent you had a 16 percent Unemployment Rate so so i but look even if we look at 13 percent thats still one of the highest numbers weve had since the Great Depression bit the growth came in a lot of instances simply from reopening the economy so that you know even if its 50 percent you know youre hiring back some steps they work at restaurants again or other services that have been closed down i mean it i mean new york and most of the economy still shut down here in new york city but in other places its comparatively open so so clearly theres an impact map you have to ask yourself whether a lot of these Industries Like retail leisure restaurants are ever going to recover from the prepared democrat levels at least for several years to come i mean you know restaurants will be operating at 50 percent capacity as an example can be considered are you making any money i mean i know 1. 00 people work in the Restaurant Business when they have 200 percent capacity to make their job no thats right thats right i mean it i mean and im as i say in new york theres a ton of small restaurants newspaper high rents theyre not going to be able to make it and and thats not unique or on the company and of course some you know were doing this on zoom lots of teleconferencing in telecommuting mean done zoom so that means less and less travel less airplanes boeing was having problems even before this latest crisis theyll probably make it as a sub. Contract for the pentagon but theres a 1000000000 business could go straight down the tubes so there is there are some real problems going in regard to hysteresis you know any bailing out an airline somebody that doesnt make good Airlines Anymore really who really we are going to im going to were going to go to a short break let your break you were discussion on the recovery stage. We go to work so you straight home. Has changed Many American lives the pharmaceutical companies have a miraculous solution. Based drugs to people who are chronic pain patients and believe that their opiate prescription is working for them in the remedy he said to. Price at the. Grocery dependency and addiction to opiates to long term use that really isnt scientifically justified and ill study actually suggest that. The long term effects my not just being the absence of benefit but actually that by my because of the long term. Well the magic cross up were all things are considered im Peter Lavelle to remind you were discussing the state of the economy. Again you lets let me go to you lets talk about you know what the government is doing and not doing you know you can call it a bailout. Package we can talk about the timing of it all. What is it going to stop the free fall was it basically meaningless because they were bailing out people that have more money than god anyway and using that tax code i mean thats thats what that. Fine when you have high unemployment you can redistribute wealth only have so many people unemployed theyre not paying payroll at all and we can talk about the derivative issue of health care if you dont have a job because the government doesnt write paying for the working people of america im not touching about the rich working people go ahead well you know its interesting you raise that issue because Consumer Confidence among the lowest quintile and the 2nd to lowest quintile has recovered at the fastest pace in fact were seeing Consumer Confidence among those who make between 75099000 a year continue to slump as layoffs begin to move into white Collar Industries my greatest concern about giving the lowest income earners and an additional 600. 00 a month out to the end of july and well well see if that is extended or not. Is that its provided a false sense of security to an income cohort that will then be at the end of this stimulus period still facing the same traumatic financial consequences as they faced before and i refer to cop cars being repossessed or rental evictions and in fact youve seen more reticence just in the last few days among potential car buyers and one of their chief concerns is that there is going to be an expiration of the moratorium on rental evictions so the question is have you have you just bought a little bit of time while demand destruction is occurring in the background such that youre not just going to have people and why call a positions but also people at the lowest income runs out of work and will there be the political where with all to address what really needs to be addressed which is figuring out a way to secure jobs as opposed to keeping people on effective universal basic income which has which is really what has been created by congress and has resulted in a disproportionate number of you of u. S. Workers being called back to work and saying no im collecting a lot more right now than i was before so the incentive system is just all catty wankers to use a very technical term and i worry about whats going to happen on the other side of this because the fate of so many millions of americans rests in congress right now yeah and. Those funds that were sent out i would have no match in the great deal of it is just to pay off debts to if thats what people are using the money for it because they dont know i mean they worry if you know if theres light at the end of the tunnel its really going to be another train coming in their direction i think thats really the analogy here or should what do you think of how the government is responding to this because i must say this from a moralistic point of view you know we kind of wipe their hands theyve been on big. Ation you know i mean there are tens of millions of the emergencies out there in the country people losing their jobs. You know and im a you know as a conservative. I dont you know my 1st reaction is limited government i dont like people becoming dependent on the government i think that anything that the government should do should keep Families Together in people and work and then thats the derivative but in an emergency in the blocks want to bend like this i think that you know if you cant use the argument we dont have any money we have plenty of money for their friends and their special interests here but in the end you brings up this really important issue is that you know how much is the people good and creating or creating relief but without creating dependency because there is that issue people say why should we go back to that im getting a check i know we. Showed it in so to that it said you know come july 1st for now those checks wont be coming anymore which does raise the problem that. Brought up and what happens afterwards if there is not a job to go back to look its its an unusual situation because you effectively have created its been the government that has created this mass unemployment in order to deal with a public pandemic. They have put the economy into a deep freeze coma and to you we can i dont want to discuss whether that was the right of the wrong thing to do in terms of luck and the fact is you knew it instantaneously created mass unemployment but if you want to sustain Political Support for those relief efforts then youve got to make sure that you do it properly and i think the europeans have done a better job about than we have in the sense that many of them have just gone straight to a a nationalized payroll and that to me that wouldve been a more desirable way to go because youre its less politicized you all you dont have to create a whole bunch of new bureaucracy to do it you have the the. Data within the the. The i. R. S. For exactly its easy its easy enough to to get those checks to those people from existing base but if you think payroll and it would have taken out a lot of the government discretion and a lot of the political problems that you that youve raised so denmark norway did that even the conservative government of johnson says the tories covered about 80 percent of salaries up to 30000. 00 pounds so that to me would have been a much better way to go of course as the economy recovers you do want to wean people off point is that if you are the one responsible for throwing people out of course then i think there is a moral obligation to make sure that they they are compensated for that and likewise in regard business as i say you dont want to create a profit windfall but there is a a constitutional clause in the Us Constitution that the takings provision which assumes that which mandates that you compensate. For any of the sustain which as a result of Government Action now i dont think you can get them when all profits but at the same time. They should be compensated for their fixed costs theyve been they would have otherwise incurred i think that would have been a fair way to sustain support from their side and being consistent with constitutional provisions that we have here and only only if i agree with it that would be the moral thing to do so its a common sense thing to do at the same time i mean if you you know you eternally economy on which i dont think in the history of ever this is ever been tried. Ok and we all sort of ok. When you have the last right the most 929 when you you wonder what was happening i mean if you were money a market maker you want everything is coming to heart this is something that we get noticed and we all kind of walk through to the. Darr what you wrote was going on here and it seems to me that not only was it would have been the morals the decision but if you wanted to switch back to her you would have time for a better chance of the moving parts you more or less the same as late were but now were in a very different environment. We are and i wont take credit for this idea it was actually it was actually articulated 1st by mark cuban who said you know the i. R. S. Has access to all of these Bank Accounts of all these Small Businesses why dont you just give them overdraft protection until the end entire National Economy is ready to reopen and rather than this patchwork that weve seen where arizona opens quickly and now its hospitals are becoming overwhelmed and texas is open very quickly and now weve got weve got record levels of coronavirus cases so youve got this this this piecemeal approach to reopening because there is this need to get that you know through the business doors open so that we can get back to work i get that but had you had a much more coup ward 8 it blanket National Approach i think that there would have been a lot more calm among the Small Business owners of the country and more of that kind of a for lack of better word congeniality if you will nationwide as opposed to what weve ended up with which is a ton of divisiveness that we all know serves absolutely no purpose. Marshaling then you know i always explain to the north americans about the virtues and then the downside of having the kind of country the United States has because we have states ok and i constantly telling my friends that governors can say no to the president i mean. They were elected in their state thats what the response to do and you know its very very confusing but you know this is one of those downsides here and we all pretty much kept our promise not to politicize this but it was because of oh its i dont think it was because of good Public Policy got in the way when we look at 8 because it wasnt a nation or white response really it was very peaceful and he also said it was piecemeal but in fairness you know its a its a large country a large geography so you know its not like new zealand where you know youre 7000 miles away from everything and you can easily shut everything down so its very hard to construct a sensible National Response which will meet the needs of new york in the same way that it will meet the needs of texas that is both a strength and a weakness a host country as you pointed out but i dont think it i think it does complicate the issue of federalism theres once you can have common criteria which i think they tried to do but you know look new york has more or more than half the cases so to suggest idaho should all exactly the same plan new york as its silly and i think thats reality. Ok going to work well when people say the word recovery what does that mean in your mind what kind of recovery do you want to see him again i want to keep my focus on the middle classes and working people what is a recovery for them well i think the recovery needs to be kind of as i was suggesting in a utopian manner the shutdown was coordinated i would like to think her coverage would be even more coordinated such that there were certain strictures dictated so that when you do reopen you can reopen to the fullest and that is my greatest concern is that across the nation you have consumers and this is a consumer driven economy 70 percent consumption you have some consumers who see the local news and for example see people who are not Wearing Masks and say thats mine all throw up my hands and be reticent to return to my old Consumption Habits until i see that things are such that i am comfortable so you might my greatest hope for the recovery is that the people of individual communities and states and the country come together and say the more we can be much more aggressive at reopening if we approach this as many asian nations that have never shut down have approached it and that is by making sure that you maximize reopening by maximizing the general Comfort Level of among all consumers so that we can get this engine started back up as opposed to going back to marshalls analogy ok great weve turned the car back on but were still driving as if were in a school zone what we need more than anything else is certainty and we all have to agree on that there has to be consensus as all the time we have i want to thank my guests in dallas and in new york and i want to take our viewers for watching us iraq you see you next time remember. Bests drugs were her cocaine as were 4 bucks for dia and just 50. Everybody use cocaine crack cocaine you can smoke it this is worse like 1530. 20. Its called k 2 this is about a 15. 00 bet and people smoke this one bigger 2nd sweetie you can find these drugs in any city in the United States that she was long as you want to get it set out to. Make money. And thats what i did every day. Ah no team no crowd. No shots no. Action felt. Well its true no the 1st. Point your thirst for action. That inspired test in paris is figures show that more than 50000. 00 Health Workers became infected with the coronavirus during the pandemic. Meanwhile in the u. K. A poll that shows that the heights of the Health Crisis in the country around 25000 patients were discharged from hospital simple fact. Home is being tested for with 19 and the commission blames russia and china for waging a decision from h. In war during the pandemic and hes calling on social media giants to move east leaving content and could use a monthly report into their progress against