This has been a horrible week, and tomorrow's news is not going to cheer anybody up. I hope you're looking after yourself as best you can.
Illustration: Sarah Grillo/Axios
There is no particular reason why America's move toward authoritarianism should hurt the markets.
Why it matters: Capitalism won the Cold War. Free countries with free markets could and did outspend Communist dictatorships; Russia and China ended up embracing capitalism as the only way to retain their global power and influence.
The bottom line: Capitalism is amoral. It cares not about human rights and freedoms — or even much about human lives, beyond their affiliated cashflows.
By the numbers: U.K.-based think tank Z/Yen has been calculating the strength of international financial centers using a consistent methodology twice a year since 2007.
London and New York have always held the top two places, but their lead over the rest of the pack has diminished greatly over the 13 years since the index was launched.
What they're saying: "Unrest generally has a small but measurable impact on competitiveness," says Z/Yen head of indices Mike Wardle. Hong Kong in particular is notable for remaining one of the strongest financial centers in the world, even after a full year of tear gas and violent protest.
Driving the news: Hongkongers are set to lose many important freedoms in the wake of the passage in Beijing of a sweeping new security law. The territory's special trade status with the U.S. is now imperiled. But none of that is likely to hurt Hong Kong's status as a key financial center.
Hong Kong's fate puts the U.S. protests in perspective.
Illustration: Annelise Capossela/Axios
The United States is about to embark upon the most momentous social experiment in living memory: What happens when you take laissez-faire economic principles and apply them to public health?
By the numbers: America continues to see tens of thousands of new coronavirus cases every day. Very few of them result in a comprehensive contact-tracing review. Given the amount of virus in the population, there's a non-negligible probability that any of us could be unknowingly infectious today.
Why it matters: Governors can't simply decree that business is back to usual. So long as a significant proportion of society is unwilling to resume economic activity, employment and GDP will remain depressed.
The bottom line: Countries with more forceful and effective government responses have been able to bring the rate of infection down to a level at which most citizens can reasonably feel safe from the disease. That's not going to happen here — and it's not going to happen in places like Brazil, India, or Mexico, either.
The U.S. has failed to hammer down the rate of new infections, which remain around 20,000 per day even as most states begin to come out of lockdown. Some states, such as Arizona, are seeing new record highs, even as the National Institutes of Health warns that a warm and humid summer won't help dampen the spread of the disease.
The bottom line: The world's governments, collectively, were faced with the task of getting COVID-19 under control. They didn't.
"Overnight we saw mass social unrest, continued culture wars, the prospect of martial law, a curfew in the world's biggest financial center, and the looting of a retail icon," tweeted Bloomberg's Tracy Alloway on Tuesday. "So naturally, futures are up."
Why it matters: Sometimes, in the markets, bad news is good news. In this case, corporate America seems to be acting rather like one of those improbable Hollywood action heroes: No matter how large and how terrible the perils thrown in its way, the result never seems to be much more than a flesh wound.
By the numbers: The S&P 500's net profit margin was a robust 10.5% in the first quarter of 2020, despite a large part of the economy being shut down by the novel coronavirus.
The big picture: The real economy is terrible, with GDP plunging and unemployment reaching Depression-era levels. If corporate earnings can survive all this and a historic bout of social unrest, investors can be forgiven for thinking that they can probably survive anything.
The May employment report comes out tomorrow. It will show many millions more unemployed Americans, the vast majority of whom are eligible for $600 per week in federal unemployment checks — over and above whatever they receive from their states.
By the numbers: The total cost of unemployment benefits was more than $430 billion in April alone, according to the Bureau of Economic Analysis. That's a rise of more than $400 billion from the pre-crisis level.
The bottom line: A ProPublica headline this week puts it succinctly: "Germany Saved Its Workforce From Unemployment While Spending Less Per Person Than the U.S."
Illustration: Eniola Odetunde/Axios
The May jobs report tomorrow will give the clearest unemployment picture of the pandemic, writes Axios' Courtenay Brown.
Why it matters: Weekly unemployment claims figures are an imperfect way to measure the scope of job destruction. They include doubly-filed claims and claims that weren't processed at all, plus they give no indication of how many people have got jobs.
One other thing to watch: The BLS disclosed in April's report that some workers were misclassified as employed, even though they were "absent" from work. They might fix that issue, which would have pushed April’s unemployment rate almost five percentage points higher.
Photo: Win McNamee/Getty Images
The Lincoln Memorial, designed by New York Beaux-Arts architect Henry Bacon, was constructed between 1914 and 1922.
This week, the steps to the memorial were taken over by the District of Columbia National Guard, in a jarring show of military force.