Jan 23, 2017

Big in Business: Don't mess with West Texas

Jacob Ford / Odessa American via AP

The Permian Basin still matters:

Simon Lack of SL Advisors points out that even as Persian-Gulf OPEC states tried to chase American shale producers from the market following the oil-price crash of 2014, exploitation of the Permian Basin in West Texas remained a profitable, and the location is home to nearly half of the active rigs in America today.

The resilience of the Permian Basin speaks to the future economic power of Texas and its continued importance to the American energy, especially as rig counts in North Dakota and elsewhere have collapsed.

The Fed's public relations problem:

For years now, the Federal Reserve has seen no conflict between its goals of keeping inflation low and employment high. But as inflation rates rises above its 2% annual inflation target, Janet Yellen and company will have to start raising interest rates more quickly.

Why it matters: Donald Trump's inauguration address suggested that despite a low unemployment rate, the American public isn't satisfied. But as Ian Shepherdson of Pantheon Macroeconomics writes in a research note, the Fed pays closer attention econometrics than it does public opinion.

Shepherdson argues that the Fed can't force companies to focus on hiring folks who have left the workforce since 2008, which means that we could see much higher inflation before we see the labor market heal to the Trump White House's standards.

What we're watching:

McDonald's reports earnings Monday morning, and the results could provide a window into the health of the American economy.

Analysts don't expect the firm to maintain the growth that was spurred by the introduction of all day breakfast last year, and that slowdown could be exacerbated by the rising cost of labor.

Why it matters: Fast food companies like McDonald's will be the first to feel the sting of higher wage inflation, and how the firms react to a shorter supply of workers—whether it's through higher prices, investing in training, or investing in automation—will foreshadow the reaction of the rest of the economy.

Go deeper

U.S. coronavirus updates: Death toll nears 11,000

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios

Recorded deaths from the novel coronavirus surpassed 10,900 in the U.S. early Tuesday, per Johns Hopkins data. More than 1,000 people in the U.S. have died of coronavirus-related conditions each day since April 1.

Why it matters: U.S. Surgeon General Jerome Adams said on Sunday this week will be "the hardest and saddest week of most Americans' lives" — calling it our "our Pearl Harbor, our 9/11 moment."

Go deeperArrowUpdated 44 mins ago - Health

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 11:30 p.m. ET: 1,347,803 — Total deaths: 74,807 — Total recoveries: 277,402Map.
  2. U.S.: Total confirmed cases as of 11:30 p.m. ET: 368,196 — Total deaths: 10,986 — Total recoveries: 19,828Map.
  3. Trump administration latest: President Trump's economic adviser Peter Navarro warned White House colleagues in late January the coronavirus could take over half a million American lives and cost close to $6 trillion, memos obtained by Axios show.
  4. 2020 update: Wisconsin Supreme Court blocks governor's attempt to delay in-person primary voting delayed until June.
  5. States latest: West Coast states send ventilators to New York and other states with more immediate need — Data suggest coronavirus curve may be flattening in New York, Gov. Andrew Cuomo said.
  6. World update: U.K. Prime Minister Boris Johnson moved to intensive care as coronavirus symptoms worsen.
  7. Stocks latest: The S&P 500 closed up 7% on Monday, while the Dow rose more than 1,500 points.
  8. What should I do? Pets, moving and personal health. Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk.
  9. Other resources: CDC on how to avoid the virus, what to do if you get it.

Subscribe to Mike Allen's Axios AM to follow our coronavirus coverage each morning from your inbox.

Docs: Navarro memos warning mass death circulated West Wing in January

Image from a memo to President Trump

In late January, President Trump's economic adviser Peter Navarro warned his White House colleagues the novel coronavirus could take more than half a million American lives and cost close to $6 trillion, according to memos obtained by Axios.

  • By late February, Navarro was even more alarmed, and he warned his colleagues, in another memo, that up to two million Americans could die of the virus.

Driving the news: Navarro's grim estimates are set out in two memos — one dated Jan. 29 and addressed to the National Security Council, the other dated Feb. 23 and addressed to the president. The NSC circulated both memos around the White House and multiple agencies.

Go deeperArrow2 hours ago - Health