Member Briefing April 27, 2022
U.S. Durable-Goods Orders Climb 0.8%, Posting Fifth Increase in Six Months
New orders for products meant to last at least three years increased by 0.8% to a seasonally adjusted $275 billion in March following a 1.7% drop in February, the Commerce Department said Tuesday. The increase was driven by orders for autos, computers and other electronics and marked the fifth increase over the past six months.
First-time orders in February for all manufacturing industries were revised up to $272.7 billion from the prior month’s estimate. Excluding defense, orders of durable goods rose 1.2%. New orders for nondefense capital goods excluding aircraft, so-called core capital goods, a closely watched proxy for business investment, rose by 1% to $80.8 billion in March compared with the previous month.
Invasion of Ukraine Headlines
- Ukraine and Russia: What You Need to Know Right Now – Reuters
- Russia Now Warns of ‘Considerable’ Nuclear War Risk, Ukraine Says it’s Just Trying to Scare the World off Arming Kyiv – Fortune
- Germany to Send Heavy Weapons to Ukraine Following Allied Pressure – WSJ
- Russia Ending Gas Shipments to Poland – UPI
- Photos: More than 5 Million Have fled Ukraine as Russia’s Invasion Continues – NPR
- Kremlin Says Gazprom Working on Implementing Roubles-for-Gas Scheme – Reuters
- World Bank: Ukraine War to Cause Biggest Price Shock in 50 Years – BBC
- Russia Bombs Five Ukrainian Railway Stations in Central and Western Ukraine – The Guardian
- Map – Tracking Russia’s Invasion of Ukraine – Live Universal Awareness Map
Court of Appeals Hears Redistricting Case
New York’s new district lines landed before New York’s top court on Tuesday as the seven judges of the Court of Appeals heard oral arguments on whether maps that would leave Democrats well-positioned to pick up three seats in Congress should stay in place. A decision is expected by the end of the week and could be handed down as soon as Wednesday afternoon or evening.
The questioning from judges, who were all appointed by Democrats, seemed to leave open the possibility that at least several judges agreed that the lines seem problematic, though did not yet see an obvious path to make them better without a complex intrusion into a decision from another branch of government ahead of the June 28 primaries for congressional seats.
New York’s Gubernatorial Race News
Gov. Kathy Hochul played defense on controversial aspects of the record $220 billion state budget – especially the $600 million in taxpayer funding she garnered for a new stadium for the Buffalo Bills – following a new poll showing her struggling with voters.
Meanwhile… A new statewide poll suggests Rep. Lee Zeldin is gaining ground in the GOP race for governor against rivals like former Trump administration official Andrew Giuliani, businessman Harry Wilson and former Westchester County Executive Rob Astorino.
US COVID – Creeping Toward 1 Million Deaths
As the US edges closer to marking 1 million deaths from COVID-19, many are grappling with how to explain this reality. In an attempt to describe the seemingly unfathomable death toll. In the US, the pandemic’s death toll has been concentrated among elderly populations, including those at long-term care facilities, and mortality rates are highest among Black and Hispanic populations. For a second year, COVID-19 was the third leading cause of death in the US in 2021, although racial and ethnic disparities narrowed compared with 2020, most likely showing the impacts of public health interventions such as contact tracing, mask mandates, and, most importantly, vaccination.
Additionally, many could have been spared immense amounts of grief with more widespread and quick vaccine uptake. According to a study published April 25 in JAMA Internal Medicine, most families who had loved ones in intensive care units (ICUs) due to COVID-19 have experienced symptoms of post-traumatic stress disorder (PTSD). Ed Yong of The Atlantic notes that for every person lost to COVID-19, an average of 9 close relatives are left bereaved, meaning no fewer than 9 million US residents are learning to cope with grief and adjust to their new realities, processes often intensified by the continuing politicization of the pandemic.
NY COVID Cases Rose 37%, Hospitalizations 24% – CDC Recommends Mask Wearing in these 23 Counties (None in the Hudson Valley)
New York reported 49,500 cases in the week ending Sunday, up from 36,180 new cases the prior week. COVID-19 patients admitted to hospitals statewide last week totaled 3,219, up from 2,603. New York ranked second among the states where coronavirus was spreading the fastest on a per-person basis, a USA TODAY Network analysis of Johns Hopkins University data shows.
Indoor mask wearing recommendations for 23 “high-risk” counties now covered large sections of upstate New York, including much of the Finger Lakes and Southern Tier, according to the Centers for Disease Control guidelines based on COVID-19 infection rates and the strain on local hospitals. That’s up from 10 counties on April 18. The “high-risk” NY counties are listed in the article.
As U.S. Nears COVID Milestone, What Has it Learned?
The U.S. has a habit of prematurely declaring victory over deadly diseases–and then a new wave roars back and kills hundreds of thousands more Americans. At least that was the cycle more than a century ago with the Spanish flu. Back then, there was some opposition to health experts and mask mandates; applause when the mandates ended; surprise when the killing resumed.
These days, Americans face conflicting mask rulings and guidance, signs of a gathering variant, and the approaching milestone of one million documented COVID-19 deaths. Researchers studying the Spanish flu found death rates varied widely by city, based on how early, stringent or prolonged the public health precautions were. A century later, drugs and public hygiene have improved dramatically, but the world has become a more crowded, interconnected place. And humans still are wired to be impatient, gravitating toward the easy thing—wanting, powerfully, to believe they’ll be fine. History and baseball great Yogi Berra tell us this: It ain’t over till it’s over.
U.S. to Widen COVID Antiviral Pill Distribution
The Federal government is aiming to expand access to Covid-19 oral antiviral treatments like Pfizer’s Paxlovid by doubling the number of locations at which they are available, the White House said on Tuesday.
Pharmacies participating in the federal pharmacy program for distributing antiviral treatments will be able to order the free treatments directly from the U.S. government starting this week. Currently, the pharmacies are dependent on states to obtain the pills. The government sends the treatments to select pharmacies, as well as directly to states and community centers. Under the current system, the treatments are available in around 20,000 locations. The administration expects to increase their direct distribution to over 30,000 locations soon and reach 40,000 sites over the coming weeks, the official said.
Conference Board: US Consumers Still Confident in April, but Slightly Less So
The Conference Board’s measure of consumer confidence dipped slightly to 107.3 from 107.6. Expectations rose by 0.5 points, but the present situation measure fell 1.2 points. Confidence was hit by the invasion of Ukraine and the subsequent surge in gas prices, but it now appears to have stabilized. Still, the Conference Board’s measure of confidence is much stronger, relative to its long-run average, than the Michigan sentiment data, probably because it is more sensitive to the unemployment rate.
Inflation expectations for the next 12 months dipped to 7.5% after February’s leap to a cycle high, 7.9%, but remain much higher than before the pandemic. Finally, note that homebuying intentions are falling, with the 12-month average hitting an 18-month low in April. It has further to fall.
China COVID Lockdowns Threaten Higher Prices in US
Beijing’s aggressive action to curb the spread of COVID-19 is likely to further fuel inflation in the U.S., where companies are struggling to get products from their Chinese suppliers. “The prolonged lockdown in Shanghai plus highway controls in a number of provinces have been severely disrupting logistics in China. The disruption is likely to last for weeks and will weigh on activity in April and into May, if not longer,” Tommy Wu, lead China economist at Oxford Economics, wrote in a research note.
Nearly one-fourth of the world’s stalled container ships are waiting outside of Chinese ports, according to data provided by maritime intelligence firm Windward AI. In total, 412 vessels were stuck just outside of China over the weekend, down 19 percent from the peak late last month but up 58 percent from February.
DHS Extends Form I‑9 Requirement Flexibility (Effective May 1, 2022)
The Department of Homeland Security (DHS) and U.S. Immigration and Customs Enforcement (ICE) announced an extension of the flexibility in complying with requirements related to Form I‑9, Employment Eligibility Verification, due to COVID‑19. This temporary guidance was set to expire April 30, 2022. Because of ongoing precautions related to COVID‑19, DHS has extended the Form I‑9 flexibilities until Oct. 31, 2022.
Employers are encouraged to begin, at their discretion, the in-person verification of identity and employment eligibility documentation for employees who were hired on or after March 20, 2020, and who presented such documents for remote inspection in reliance on the flexibilities first announced in March 2020.
Amazon Launches $1 Billion Fund to Invest in Warehouse Technologies
The Amazon Industrial Innovation Fund will focus on new technologies that will “increase delivery speed and further improve the experience” of warehouse and logistics employees, Alex Ceballos Encarnacion, Amazon’s vice president of worldwide corporate development, wrote in a blog post.
The fund is one subset of Amazon’s growing investment activity. The e-commerce giant in 2020 launched a $2 billion fund to invest in climate technologies, and it operates the Alexa Fund, which has made investments in speech-recognition technology, among other areas.
Stanley Black & Decker Awards $25 Million to Workforce Partnerships
As evinced by its facilities like The Manufactory, that pioneers and tests new manufacturing technologies leading to innovations such as its new flexible automation cells, SB&D has a long-standing interest in advancing the construction and manufacturing sectors through providing new tools and the education to use them.
SB&D’s “Empower Makers” Global Impact Challenge aims to close the trade skills gap by committing $25 million in grant money over the next five years to nonprofits that serve the constructing and manufacturing sectors with trade workforce development initiatives. The Manufacturing Institute is among the 86 organizations selected by SB&D on the basis of diversity, sustainable impact, and depth of programs among other considerations.
Ford Juices Production of Lightning F-150 Electric Truck
Ford Motor Co yesterday started regular manufacturing of its F-150 Lightning electric pickup truck, more than tripling planned annual production of the vehicle that now symbolizes the 118-year-old company’s drive to retool for a new century.
Ford aims to build 150,000 Lightning trucks a year at the new part of its historic Rouge manufacturing complex while it builds a much larger electric vehicle production complex in Tennessee. It had planned to build just 40,000 annually, but surging demand for electric vehicles prompted Ford to increase planned production twice since last August of the Lightning, a heavily modified version of its best-selling F-150 pickup truck
GE Guides to Low End Renewables Division Lost More than $400 Million During the First Quarter
General Electric posted a net loss of a little more than $1 billion in the first quarter on revenues of $17.0 billion as equipment sales slipped 14% in part because of snarled supply chains. Adjusted for several one-time items, profits rose 19% from early 2021, with aviation work growing strongly while the performance of GE’s healthcare and renewable energy groups was worse than in the prior-year period. The latter posted a segment loss of $434 million as customers delayed orders in the face of strong inflation and the U.S. onshore wind market shrank as stakeholders wait for clarity on the future of a production tax credit.
The company also booked a $200 million pre-tax charge to account for the impact on its businesses, primarily aviation and power, of Russia’s invasion of Ukraine and incurred $100 million in costs related to planning work for its separation into three companies.
New Home Sales Dive in March; Prices Surge
New home sales plunged 8.6% to a seasonally adjusted annual rate of 763,000 units last month, the Commerce Department said on Tuesday. February’s sales pace was revised higher to 835,000 units from the previously reported 772,000 units. Sales fell in all four regions. New homes are a leading indicator of the housing market as they are counted when a contract is signed, and can also offer an early read of the impact of higher mortgage rates on housing demand.
The median new house price in March jumped 21.4% from a year ago to $436,700. Almost all the houses sold last month were above the $200,000 price level. Strong house price growth is expected to persist through this year and into 2023.