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J.C. Penney Files for Bankruptcy Protection J.C. Penney Files for Bankruptcy Protection
(1 day later)
This briefing is no longer updating. Read the latest developments in the coronavirus outbreak here.This briefing is no longer updating. Read the latest developments in the coronavirus outbreak here.
J.C. Penney filed for bankruptcy protection on Friday, the latest and largest retailer to fall during the coronavirus pandemic.J.C. Penney filed for bankruptcy protection on Friday, the latest and largest retailer to fall during the coronavirus pandemic.
Its collapse follows other retail bankruptcies this month including J. Crew, the Neiman Marcus Group and the designer men’s clothing brand John Varvatos. But J.C. Penney represents the biggest casualty by far based on the number of locations. It’s more than 800 stores are anchors at many American malls, with nearly 85,000 employees.Its collapse follows other retail bankruptcies this month including J. Crew, the Neiman Marcus Group and the designer men’s clothing brand John Varvatos. But J.C. Penney represents the biggest casualty by far based on the number of locations. It’s more than 800 stores are anchors at many American malls, with nearly 85,000 employees.
The filing was expected after J.C. Penney failed to make an interest payment on its debt in April to “maximize financial flexibility,” and then skipped another payment last week. The stock of the retail chain, which is based in Plano, Tex., has been trading below $1 per share for most of this year, Sapna Maheshwari and Michael Corkery write.The filing was expected after J.C. Penney failed to make an interest payment on its debt in April to “maximize financial flexibility,” and then skipped another payment last week. The stock of the retail chain, which is based in Plano, Tex., has been trading below $1 per share for most of this year, Sapna Maheshwari and Michael Corkery write.
The company’s sales have steadily shrunk in recent years to $10.7 billion for the year ended Feb. 1, when it posted a net loss of $268 million from continuing operations. At the time, it said it had 846 stores in the United States.The company’s sales have steadily shrunk in recent years to $10.7 billion for the year ended Feb. 1, when it posted a net loss of $268 million from continuing operations. At the time, it said it had 846 stores in the United States.
A decade ago, J.C. Penney was still seeing declines, but its sales were $17.6 billion and it posted income of $249 million from continuing operations. Back then, it had more than 1,100 stores and 154,000 employees.A decade ago, J.C. Penney was still seeing declines, but its sales were $17.6 billion and it posted income of $249 million from continuing operations. Back then, it had more than 1,100 stores and 154,000 employees.
It was a week of downbeat pronouncements and grim economic data that had investors focus on the dire challenges facing the American economy.It was a week of downbeat pronouncements and grim economic data that had investors focus on the dire challenges facing the American economy.
Friday was no exception, and stocks were unsteady for most of the day, after new data showed how devastating the impact of the coronavirus pandemic had been to retail sales.Friday was no exception, and stocks were unsteady for most of the day, after new data showed how devastating the impact of the coronavirus pandemic had been to retail sales.
After a sharp fall early in the day, the S&P 500 rebounded, ending the day with a gain of less than 1 percent.After a sharp fall early in the day, the S&P 500 rebounded, ending the day with a gain of less than 1 percent.
Still, thanks to back-to-back declines on Tuesday and Wednesday, the index had its sharpest weekly drop since late March, a retreat that stands out after a long stretch in which stock investors seemed willing to look past the deeply negative outlook for the economy and the uncertain path of the coronavirus outbreak.Still, thanks to back-to-back declines on Tuesday and Wednesday, the index had its sharpest weekly drop since late March, a retreat that stands out after a long stretch in which stock investors seemed willing to look past the deeply negative outlook for the economy and the uncertain path of the coronavirus outbreak.
On Tuesday, the nation’s top infectious disease expert, Dr. Anthony S. Fauci, warned lawmakers that an overly rapid reopening of large swathes of the American economy, which had been shuttered in an effort to control the outbreak, could reignite the outbreak. His comments drove a sell-off in the stock market, which closed down 2 percent.On Tuesday, the nation’s top infectious disease expert, Dr. Anthony S. Fauci, warned lawmakers that an overly rapid reopening of large swathes of the American economy, which had been shuttered in an effort to control the outbreak, could reignite the outbreak. His comments drove a sell-off in the stock market, which closed down 2 percent.
The economic prognosis offered by the Federal Reserve chair, Jerome H. Powell, the next day did little to soothe investors. The head of the central bank warned of potentially serious consequences if the deep economic downturn facing the country was not countered with forceful fiscal policies.The economic prognosis offered by the Federal Reserve chair, Jerome H. Powell, the next day did little to soothe investors. The head of the central bank warned of potentially serious consequences if the deep economic downturn facing the country was not countered with forceful fiscal policies.
“The one-two punch from Fauci/Powell is that the road ahead is likely to be rocky — perhaps rockier than market was hoping for,” William Delwich, an investment strategist at Baird, a financial firm based in Milwaukee, wrote in an email.“The one-two punch from Fauci/Powell is that the road ahead is likely to be rocky — perhaps rockier than market was hoping for,” William Delwich, an investment strategist at Baird, a financial firm based in Milwaukee, wrote in an email.
Amid it all, a parade of economic reports continued to show an economic downturn of breathtaking speed and scope.Amid it all, a parade of economic reports continued to show an economic downturn of breathtaking speed and scope.
In April, consumer prices — excluding volatile food and energy prices — posted their fastest month-on-month collapse in records going back to 1957; industrial production fell 11.2 percent in April, the largest drop in the 101-year history of the index; manufacturing output fell 13.7 percent, also a record; and retail sales dropped a record 16.4 percent.In April, consumer prices — excluding volatile food and energy prices — posted their fastest month-on-month collapse in records going back to 1957; industrial production fell 11.2 percent in April, the largest drop in the 101-year history of the index; manufacturing output fell 13.7 percent, also a record; and retail sales dropped a record 16.4 percent.
The latest weekly update on applications for unemployment benefits showed nearly three million more Americans applied. Some 36 million jobs have been lost in the last two months.The latest weekly update on applications for unemployment benefits showed nearly three million more Americans applied. Some 36 million jobs have been lost in the last two months.
The result is an incongruous situation in which stocks have soared even as economic data have continued to show the United States is entering one of the worst recessions in its history.The result is an incongruous situation in which stocks have soared even as economic data have continued to show the United States is entering one of the worst recessions in its history.
Prices of other “safe” investments — such as Treasury bonds and gold — continue to be high, suggesting some investors continue to be unconvinced that the market rally is sustainable.Prices of other “safe” investments — such as Treasury bonds and gold — continue to be high, suggesting some investors continue to be unconvinced that the market rally is sustainable.
“Just like it did in January and early February, the stock market is ignoring the warning signals that are being sent out by the moves in the ‘flight to safety’ assets,” said Matt Maley, chief market strategist at Miller Tabak, a trading and asset management firm.“Just like it did in January and early February, the stock market is ignoring the warning signals that are being sent out by the moves in the ‘flight to safety’ assets,” said Matt Maley, chief market strategist at Miller Tabak, a trading and asset management firm.
The wild swings in stock prices that occurred in mid-March were shocking to most investors, but now it’s clear that even the Oracle of Omaha appears to have panicked.The wild swings in stock prices that occurred in mid-March were shocking to most investors, but now it’s clear that even the Oracle of Omaha appears to have panicked.
Warren E. Buffett bailed out of his holdings in Goldman Sachs in the first quarter of 2020, selling 84 percent of his stake in the Wall Street bank, according to regulatory filings made Friday by his conglomerate, Berkshire Hathaway. Despite the drastic move, Mr. Buffett hung on to shares of two giant banks with stronger consumer operations, JPMorgan Chase and Wells Fargo.Warren E. Buffett bailed out of his holdings in Goldman Sachs in the first quarter of 2020, selling 84 percent of his stake in the Wall Street bank, according to regulatory filings made Friday by his conglomerate, Berkshire Hathaway. Despite the drastic move, Mr. Buffett hung on to shares of two giant banks with stronger consumer operations, JPMorgan Chase and Wells Fargo.
It was an unusual move for Mr. Buffett, who rarely exits his investments with such abruptness. But it’s clear that the coronavirus crisis has hit his company hard. Berkshire Hathaway reported a $49.7 billion loss during the first quarter this year, compared with a $21.7 billion profit during the same period a year earlier.It was an unusual move for Mr. Buffett, who rarely exits his investments with such abruptness. But it’s clear that the coronavirus crisis has hit his company hard. Berkshire Hathaway reported a $49.7 billion loss during the first quarter this year, compared with a $21.7 billion profit during the same period a year earlier.
Goldman Sachs shares are down more than 30 percent from their peak this year in January at $249.72, but their price has recovered somewhat from its lowest point, reached on March 23, when the stock closed at $134.97.Goldman Sachs shares are down more than 30 percent from their peak this year in January at $249.72, but their price has recovered somewhat from its lowest point, reached on March 23, when the stock closed at $134.97.
Marc Hamburg, Berkshire Hathaway’s chief financial officer, did not immediately respond to a request for comment.Marc Hamburg, Berkshire Hathaway’s chief financial officer, did not immediately respond to a request for comment.
The Federal Reserve used its annual financial stability report to sound a warning bell on weaknesses that have the potential to worsen the fallout in stock markets — which could then spill back into the rest of the economy — as coronavirus lockdowns slow growth, spurring job losses and causing companies and consumers to miss rent and mortgage payments.The Federal Reserve used its annual financial stability report to sound a warning bell on weaknesses that have the potential to worsen the fallout in stock markets — which could then spill back into the rest of the economy — as coronavirus lockdowns slow growth, spurring job losses and causing companies and consumers to miss rent and mortgage payments.
The financial system “amplified the shock” in March, the central bank said on Friday, as short-term funding markets in particular seized up. Some hedge funds were “severely affected” and “reportedly” contributed to market dislocations, according to the central bank’s report.The financial system “amplified the shock” in March, the central bank said on Friday, as short-term funding markets in particular seized up. Some hedge funds were “severely affected” and “reportedly” contributed to market dislocations, according to the central bank’s report.
Businesses came into the crisis highly indebted, the Fed said. Banks started out well-capitalized, but lower interest rates and the potential for credit losses could hurt their profitability and ability to replenish that capital.Businesses came into the crisis highly indebted, the Fed said. Banks started out well-capitalized, but lower interest rates and the potential for credit losses could hurt their profitability and ability to replenish that capital.
“Economic activity is contracting sharply, and the associated reduction in earnings and increase in credit needed to bridge the downturn will expand the debt burden and default risk of a highly leveraged business sector,” the report said.“Economic activity is contracting sharply, and the associated reduction in earnings and increase in credit needed to bridge the downturn will expand the debt burden and default risk of a highly leveraged business sector,” the report said.
When Michael Sullivan borrowed $22 million from a specialist Wall Street lender in 2018 to buy and renovate two Florida hotels, he had no idea how costly that decision would prove to be.When Michael Sullivan borrowed $22 million from a specialist Wall Street lender in 2018 to buy and renovate two Florida hotels, he had no idea how costly that decision would prove to be.
He found out recently, once visitors stopped coming to his properties because of the pandemic, prompting him to seek help from the federal government’s new small business loan program. But first, he had to tussle with his lender, the credit fund Benefit Street Partners, just to win permission to get the government loan. The legal fight cost him thousands of dollars and a month in lost time.He found out recently, once visitors stopped coming to his properties because of the pandemic, prompting him to seek help from the federal government’s new small business loan program. But first, he had to tussle with his lender, the credit fund Benefit Street Partners, just to win permission to get the government loan. The legal fight cost him thousands of dollars and a month in lost time.
The CARES Act, which created the government’s Paycheck Protection Program that Mr. Sullivan borrowed from, prohibits any loan money from being controlled by other lenders. At the same time, it does not outlaw lenders like Benefit Street from enforcing existing contracts with borrowers seeking government funds.The CARES Act, which created the government’s Paycheck Protection Program that Mr. Sullivan borrowed from, prohibits any loan money from being controlled by other lenders. At the same time, it does not outlaw lenders like Benefit Street from enforcing existing contracts with borrowers seeking government funds.
The $650 billion program has helped millions of small businesses, but its rollout was uneven and slowed by confusing rules. The program’s structure itself created other challenges. For businesses such as Mr. Sullivan’s, the program’s structure has required them to fight costly legal battles simply to get any funds at all.The $650 billion program has helped millions of small businesses, but its rollout was uneven and slowed by confusing rules. The program’s structure itself created other challenges. For businesses such as Mr. Sullivan’s, the program’s structure has required them to fight costly legal battles simply to get any funds at all.
Retail sales fell 16.4 percent last month, the Commerce Department said Friday. That followed an 8.3 percent drop in March, producing by far the largest two-month decline on record.Retail sales fell 16.4 percent last month, the Commerce Department said Friday. That followed an 8.3 percent drop in March, producing by far the largest two-month decline on record.
April could prove to be the bottom. The March figures were helped in part by panic buying, and stores were generally open for the first half of the month. Most states have begun to lift barriers to commerce and movement, and many economists expect spending to rise in May as people venture out.April could prove to be the bottom. The March figures were helped in part by panic buying, and stores were generally open for the first half of the month. Most states have begun to lift barriers to commerce and movement, and many economists expect spending to rise in May as people venture out.
But any rebound is likely to be gradual. There is no guarantee that customers will return in numbers previously seen — and even if Americans feel comfortable going out to shop, they may not have as much money to spend, since millions have lost their jobs.But any rebound is likely to be gradual. There is no guarantee that customers will return in numbers previously seen — and even if Americans feel comfortable going out to shop, they may not have as much money to spend, since millions have lost their jobs.
Updated June 1, 2020 Updated June 2, 2020
Mass protests against police brutality that have brought thousands of people onto the streets in cities across America are raising the specter of new coronavirus outbreaks, prompting political leaders, physicians and public health experts to warn that the crowds could cause a surge in cases. While many political leaders affirmed the right of protesters to express themselves, they urged the demonstrators to wear face masks and maintain social distancing, both to protect themselves and to prevent further community spread of the virus. Some infectious disease experts were reassured by the fact that the protests were held outdoors, saying the open air settings could mitigate the risk of transmission.
Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, “start at no more than 50 percent of the exercise you were doing before Covid,” says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. “When you haven’t been exercising, you lose muscle mass.” Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home.Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, “start at no more than 50 percent of the exercise you were doing before Covid,” says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. “When you haven’t been exercising, you lose muscle mass.” Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home.
States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people.
Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks.
Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days.
If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.)
More than 40 million people — the equivalent of 1 in 4 U.S. workers — have filed for unemployment benefits since the pandemic took hold. One in five who were working in February reported losing a job or being furloughed in March or the beginning of April, data from a Federal Reserve survey released on May 14 showed, and that pain was highly concentrated among low earners. Fully 39 percent of former workers living in a household earning $40,000 or less lost work, compared with 13 percent in those making more than $100,000, a Fed official said.More than 40 million people — the equivalent of 1 in 4 U.S. workers — have filed for unemployment benefits since the pandemic took hold. One in five who were working in February reported losing a job or being furloughed in March or the beginning of April, data from a Federal Reserve survey released on May 14 showed, and that pain was highly concentrated among low earners. Fully 39 percent of former workers living in a household earning $40,000 or less lost work, compared with 13 percent in those making more than $100,000, a Fed official said.
Yes, but make sure you keep six feet of distance between you and people who don’t live in your home. Even if you just hang out in a park, rather than go for a jog or a walk, getting some fresh air, and hopefully sunshine, is a good idea.
Taking one’s temperature to look for signs of fever is not as easy as it sounds, as “normal” temperature numbers can vary, but generally, keep an eye out for a temperature of 100.5 degrees Fahrenheit or higher. If you don’t have a thermometer (they can be pricey these days), there are other ways to figure out if you have a fever, or are at risk of Covid-19 complications.Taking one’s temperature to look for signs of fever is not as easy as it sounds, as “normal” temperature numbers can vary, but generally, keep an eye out for a temperature of 100.5 degrees Fahrenheit or higher. If you don’t have a thermometer (they can be pricey these days), there are other ways to figure out if you have a fever, or are at risk of Covid-19 complications.
The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing.The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing.
If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others.
If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested.
Charity Navigator, which evaluates charities using a numbers-based system, has a running list of nonprofits working in communities affected by the outbreak. You can give blood through the American Red Cross, and World Central Kitchen has stepped in to distribute meals in major cities.
“It’s probably fair to say the worst is over in terms of a collapse, unless there are waves of new outbreaks,” said Jim O’Sullivan, chief U.S. macro strategist for TD Securities. “But how fast does it come back? The short answer is none of us really know.”“It’s probably fair to say the worst is over in terms of a collapse, unless there are waves of new outbreaks,” said Jim O’Sullivan, chief U.S. macro strategist for TD Securities. “But how fast does it come back? The short answer is none of us really know.”
The downturn may have left lasting scars. J. Crew and Neiman Marcus have filed for bankruptcy protection, and other big retailers like J.C. Penney, which employs about 85,000 people, are expected to follow.The downturn may have left lasting scars. J. Crew and Neiman Marcus have filed for bankruptcy protection, and other big retailers like J.C. Penney, which employs about 85,000 people, are expected to follow.
The retail collapse is both a result of the economic crisis and a major contributor to it. The nation’s second-largest private-sector employer, after health care, the retail industry cut 2.1 million jobs in April.The retail collapse is both a result of the economic crisis and a major contributor to it. The nation’s second-largest private-sector employer, after health care, the retail industry cut 2.1 million jobs in April.
The Commerce Department’s report on retail sales for April showed staggering declines in individual sectors of the industry. Increased sales at grocery stores and from online retailers didn’t come close to offsetting the declines elsewhere.The Commerce Department’s report on retail sales for April showed staggering declines in individual sectors of the industry. Increased sales at grocery stores and from online retailers didn’t come close to offsetting the declines elsewhere.
Restaurants and bars have lost half their business over the past two months.Restaurants and bars have lost half their business over the past two months.
At furniture stores, sales are off by two-thirds.At furniture stores, sales are off by two-thirds.
Clothing stores have seen sales fall by 89 percent since February. That plunge shows how reliant many retailers have remained on physical outposts, even as the internet has upended the shopping landscape.Clothing stores have seen sales fall by 89 percent since February. That plunge shows how reliant many retailers have remained on physical outposts, even as the internet has upended the shopping landscape.
The German economy suffered its worst contraction since the 2008 global financial crisis, shrinking by 2.2 percent in the January-March period from the previous quarter as the shutdown of activity to halt the spread of the coronavirus pummeled growth.The German economy suffered its worst contraction since the 2008 global financial crisis, shrinking by 2.2 percent in the January-March period from the previous quarter as the shutdown of activity to halt the spread of the coronavirus pummeled growth.
These figures, combined with a revision downward to the economic growth tally for the end of 2019, mean Germany has entered a recession.These figures, combined with a revision downward to the economic growth tally for the end of 2019, mean Germany has entered a recession.
The German government, which reported the data on Friday, said the biggest hit came in March and probably worsened in April, when consumer spending, capital investment and exports — a major driver of growth in Germany — fell off a cliff.The German government, which reported the data on Friday, said the biggest hit came in March and probably worsened in April, when consumer spending, capital investment and exports — a major driver of growth in Germany — fell off a cliff.
“Things will get worse before they get better,” Carsten Brzeski, the chief eurozone economist at ING, said in a note to clients.“Things will get worse before they get better,” Carsten Brzeski, the chief eurozone economist at ING, said in a note to clients.
The worst of the pandemic is beginning to ease, with Germany and other countries slowly easing their lockdowns, but Germany’s contraction was a reminder that even if the virus dissipates, the economic fallout could pressure the European and global economy for months or years.The worst of the pandemic is beginning to ease, with Germany and other countries slowly easing their lockdowns, but Germany’s contraction was a reminder that even if the virus dissipates, the economic fallout could pressure the European and global economy for months or years.
The European Commission has projected that European Union economy would shrink by 7.4 percent this year, the worst recession in its history.The European Commission has projected that European Union economy would shrink by 7.4 percent this year, the worst recession in its history.
It started with hoarding. As the coronavirus began to spread across the United States, shoppers stocked up on toilet paper and canned food. Then, as restaurants closed and simply venturing out became a health hazard, people began cooking more meals at home.It started with hoarding. As the coronavirus began to spread across the United States, shoppers stocked up on toilet paper and canned food. Then, as restaurants closed and simply venturing out became a health hazard, people began cooking more meals at home.
These trends have had profound implications for companies like Blue Apron, which sends meal kits to more than 350,000 subscribers, and Thrive Market, an online provider of healthy foods and eco-friendly home cleaning products with more than 800,000 members.These trends have had profound implications for companies like Blue Apron, which sends meal kits to more than 350,000 subscribers, and Thrive Market, an online provider of healthy foods and eco-friendly home cleaning products with more than 800,000 members.
Our Corner Office columnist, David Gelles, interviewed Linda Findley Kozlowski, Blue Apron’s chief executive, and Nick Green, Thrive Market’s chief executive and co-founder. An excerpt from that conversation is available here.Our Corner Office columnist, David Gelles, interviewed Linda Findley Kozlowski, Blue Apron’s chief executive, and Nick Green, Thrive Market’s chief executive and co-founder. An excerpt from that conversation is available here.
On Tuesday, David will interview Mary Kay Henry, international president of the Service Employees International Union, to discuss unemployment, front-line workers and the role of unions in the crisis. Sign up here to listen to that call live and ask questions.On Tuesday, David will interview Mary Kay Henry, international president of the Service Employees International Union, to discuss unemployment, front-line workers and the role of unions in the crisis. Sign up here to listen to that call live and ask questions.
Ultra Petroleum, which produces oil and natural gas in Wyoming, filed for bankruptcy protection on Friday, its second such filing in four years. Burdened with debt, the company was struggling before the pandemic sent oil prices tumbling.Ultra Petroleum, which produces oil and natural gas in Wyoming, filed for bankruptcy protection on Friday, its second such filing in four years. Burdened with debt, the company was struggling before the pandemic sent oil prices tumbling.
Consumer spending on video games, hardware and accessories surged to a record $10.86 billion in the first quarter of 2020, an increase of 9 percent compared with the same period last year, according to data from the NPD Group. The rise came as millions of Americans sought distractions while being ordered to shelter in place to stop the spread of the coronavirus. Games such as Animal Crossing: New Horizons, Call of Duty: Modern Warfare and Doom Eternal were top titles, and the Nintendo Switch console was a strong seller.Consumer spending on video games, hardware and accessories surged to a record $10.86 billion in the first quarter of 2020, an increase of 9 percent compared with the same period last year, according to data from the NPD Group. The rise came as millions of Americans sought distractions while being ordered to shelter in place to stop the spread of the coronavirus. Games such as Animal Crossing: New Horizons, Call of Duty: Modern Warfare and Doom Eternal were top titles, and the Nintendo Switch console was a strong seller.
Vice Media will lay off 100 employees globally and 55 in the United States, the chief executive Nancy Dubuc said in an email Friday, citing both the pandemic and broader negative trends in digital media. “Some tough decisions had to be made primarily around our digital teams,” said Ms. Dubuc, who took over as chief executive two years ago. Vice had already instituted four-day workweeks for three months for staffers earning more than $100,000 in response to the pandemic, with additional pay cuts for higher-earning employees and executives.Vice Media will lay off 100 employees globally and 55 in the United States, the chief executive Nancy Dubuc said in an email Friday, citing both the pandemic and broader negative trends in digital media. “Some tough decisions had to be made primarily around our digital teams,” said Ms. Dubuc, who took over as chief executive two years ago. Vice had already instituted four-day workweeks for three months for staffers earning more than $100,000 in response to the pandemic, with additional pay cuts for higher-earning employees and executives.
Reporting was contributed by Clifford Krauss, Ben Casselman, Sapna Maheshwari, Tiffany Hsu, Emily Flitter, Marc Tracy, Mohammed Hadi, Liz Alderman, James B. Stewart, Kevin McKenna, Matt Phillips, Adam Satariano, Gregory Schmidt, Carlos Tejada and Daniel Victor.Reporting was contributed by Clifford Krauss, Ben Casselman, Sapna Maheshwari, Tiffany Hsu, Emily Flitter, Marc Tracy, Mohammed Hadi, Liz Alderman, James B. Stewart, Kevin McKenna, Matt Phillips, Adam Satariano, Gregory Schmidt, Carlos Tejada and Daniel Victor.