Counting the cost
Today marks one year since the World Health Organization declared the coronavirus a pandemic. The scale of the upheaval since then is difficult to capture, but some extraordinary numbers tell the tale…
The most important figures of all: More than 118 million cases of Covid-19 have been reported worldwide, and more than 2.6 million deaths. Around 316 million vaccine doses have been administered so far.
In the U.S. alone, there have been more than 29 million cases, nearly 530,000 deaths and around 94 million doses administered.
The U.S. government is set to spend over $5 trillion on rescue programs.
President Donald Trump signed the $2.2 trillion CARES Act into law in late March 2020.
A follow-up bill worth $900 billion was enacted in December.
Congress approved a $1.9 trillion package last night, and President Biden is expected to sign it into law tomorrow. Here’s what’s in the plan.
In addition to the fiscal stimulus, the Federal Reserve slashed interest rates and revved its money-printing powers to stabilize markets and support businesses. That nearly doubled its balance sheet, to more than $7.5 trillion.
The economic impact of the pandemic has been severe, most notably on the labor market: Despite recent gains, there are still 9.5 million fewer jobs in the U.S. than a year ago.
Over all, the economy has regained three-quarters of the sharp drop in output at the start of the pandemic, with forecasters expecting a full recovery later this year.
Rescue spending has blown out the deficit, which reached a record $3.1 trillion last fiscal year and is already running at more than $1 trillion five months into the current fiscal year.
All that spending has stoked fears about inflation, with a mountain of consumer savings bolstered by stimulus checks ready to be spent when businesses and travel reopens.
Expectations for a potential economic boom reflect the uneven impact of the pandemic, with some people and business prospering greatly and others seeing their incomes and revenue vanish overnight.
There were more than 600 big corporate bankruptcies last year, fewer than were recorded after the relatively milder 2008 financial crisis, according to S&P. Businesses already on the brink fell early on, like J.C. Penney, Neiman Marcus and Hertz, while others managed to hold on thanks largely to the Fed keeping debt markets open and propping up asset prices.
Take the airlines. Despite a near standstill in travel, no major U.S. carrier went bankrupt. Three rounds of aid gave the airlines a cushion worth tens of billions of dollars, and they raised even more in the private markets.
Stocks whipsawed early on during the pandemic — and then largely climbed, raising increasingly pointed questions about whether the markets were divorced from economic reality. (Bonds have turned jittery for their own reasons.) The S&P 500 is up 42 percent from where it closed a year ago, while the Nasdaq is up 62 percent. The past year also saw some unexpected booms:
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SPACs became the hottest trend on Wall Street, since blank-check funds can be raised quickly and remotely. Nearly 500 SPACs have raised approximately $156 billion over the past year, according to SPAC Research.
Bitcoin went on a roller-coaster ride, though investors eventually latched onto it as a hedge against inflation — or just a speculative bet. Its price is up more than 600 percent from a year ago.
Retail traders became a formidable force, piling into the markets through apps like Robinhood and collaborating on internet forums like Reddit. They helped propel the rise of so-called meme stocks like GameStop: The video game store chain’s shares are up over 6,000 percent since last year, with wrenching day-to-day volatility.
The New York Times