Grim tidings from one who oughta know.
Hotel operator Monty Bennett, the CEO of Ashford Inc., went on with Laura Ingraham on Tuesday night.
The hotel, travel, entertainment and leisure industries are being decimated by the coronavirus virus and media-spun panic.
Monty Bennett told Laura Ingraham, “I had to cut 95% of my employees. Even 9-11 or the financial crisis, it took us 5 years and 8 years respectively to fully recover from those calamities. And this tragedy is worse than those two put together time ten. It’s an absolute disaster for our industry. Morgan Stanley recently put out a note that US hotels are the hardest hit industry.”
Let’s pray our political leaders do not allow this pandemic to turn into a national depression.
Ooops, too late.
Update! The longer the shutdown, the more people will be hurt.
The economic predictions for the shutdowns may be as varied as those for the virus itself. The Federal Reserve’s James Bullard has noted that unemployment may rise to as much as 30%. Treasury Secretary Steven Mnuchin has estimated a possible unemployment rate of 20%.
Bullard’s number is higher than the unemployment seen in the United States during the Great Depression (25%), and both estimates are significantly higher than the unemployment during the Great Recession (11%). Even if we take the more conservative estimate of 20% unemployment, that is a 16.5% rise in unemployment from its recent historic lows of 3.5% unemployment.
Although it is difficult to estimate how long this downturn may linger, that is a severe shock to the economic system. It is possible that people return to work and economic activity returns in strength in short order after the shutdowns are lifted.
Even then, the costs of shutting down will have been quite large. However, it is also possible that some businesses who had to pause activity for a month or more may not be able to return at all.
Possible? It’s dead certain, a plain and simple fact of life. As is their wont, our incompetent “leaders,” with their arrogance in ignorance, are tinkering with things they can neither control nor comprehend. They aren’t the colossi or Masters Of The Universe they believe themselves to be; they’re very small men mucking about in affairs that are much too big for them—too big for anyone, in truth.
The recession could be longer than some economists are projecting. If the economy does linger in its downturn, the human costs to the shutdown will inevitably begin to increase.
Again: a certainty, a truism so obvious only a self-proclaimed “expert” could miss it.