Some things have become more popular during the lockdown. Hearteningly, donations from Fidelity Charitable's donor advised funds are up 30% from the same period a year ago. In-store purchases of "spirits including tequila and gin," however, are up an even greater 39% year-on-year.
Illustration: Sarah Grillo/Axios
Most people should and will accept free money from the government whenever it's offered. The CARES Act was designed to funnel trillions of dollars into workers' bank accounts, and was written with the expectation that few people or businesses would say no to such a gift.
Why it matters: Politicians lost no time in ratifying the anger and resentment aimed at some of the recipients of government-backed funds. The result has been a slew of businesses voluntarily rejecting government assistance.
Driving the news: The New York Times' Neil Irwin noted this week that "with stunning speed, the political conversation has pivoted from whatever-it-takes determination toward a different feeling: outrage."
The big picture: Legislation tends to be gamed, especially when it is written in a hurry. The government's Paycheck Protection Program in particular was the focus of a lot of anger after it became clear that relatively large and well-connected companies had managed to receive funding even as many very small — and even needier — businesses had been shut out of the first round.
Between the lines: To some extent, the drop-off in average loan sizes is a function of the bigger recipients' ability to receive their money in the first round. But it's also a function of the fact that bigger businesses are listening to politicians, including Treasury Secretary Steven Mnuchin.
For the record: Four of the top five businesses on the TrumpBailouts.org list of big recipients of PPP funds, put together by an anti-corruption watchdog group, have subsequently announced that they will be returning the money. Axios has done likewise.
The bottom line: Jawboning works. Even when businesses are legally entitled to bailout funds, they will often avoid taking that money when faced with political or popular opprobrium.
Illustration: Aïda Amer/Axios
Forgoing public funding is a lot easier if you can tap private markets to get the money — which is exactly what a lot of troubled companies have been able to do.
Why it matters: In the early days of the crisis, while markets were plunging, strong companies borrowed billions of dollars in cash just because they could. Now, with markets looking much healthier, weaker companies are finding themselves able to issue new debt and equity in an attempt to avoid bankruptcy.
Exhibit A: Boeing asked for a $60 billion bailout when the crisis hit, and ended up with $17 billion of federal loans earmarked for it as part of the CARES Act. The company still hasn't recovered from its 737 MAX crisis, and none of its airline customers are buying planes in any case. But investors are happy to lend it money all the same.
Airlines have also been raising private funds. There was $5 billion of new debt for Delta, $2 billion of loans for Southwest alongside another $2 billion in new equity, and a $1 billion sale of new shares by United.
Other troubled companies are also finding new money. The movie-theater chain AMC raised $500 million, for instance. And Carnival Cruises — which has announced that it will resume sailing on Aug. 1, despite grave concerns from the CDC — raised $6.25 billion.
The big picture: Junk-rated companies are able to issue new senior debt because previous lenders allowed them to. As Axios' Dion Rabouin has reported, loan covenants — the things that normally prevent existing lenders from being subordinated — weakened significantly in the run-up to the crisis. That has made it easier for companies to find new sources of funds.
The bottom line: The Fed has not yet started buying up corporate bonds. But by wading into the market and spending trillions of dollars on Treasury bonds and other risk-free assets, it has effectively unleashed billions of dollars of new money well down the credit spectrum.
Illustration: Sarah Grillo/Axios
When Jeffrey Epstein was barred from donating money to MIT, a university development officer suggested that "the Leon Black route" be used instead. As I reported back in September, Epstein engineered donations to MIT from Black, the chairman and CEO of private equity giant Apollo. Now it looks like he did something very similar at Harvard.
Driving the news: Harvard's official report on its Epstein connections has now been published , showing how professor Martin Nowak was funded after Epstein was convicted of sex crimes in 2008.
Barred from donating to the university after his conviction, Epstein remained very close to Nowak.
Black confirms to Axios via a spokesperson that he was introduced to Nowak by Epstein, and says that the funds he gave to Nowak were not "provided by Mr. Epstein."
The bottom line: At MIT, Black was viewed as a donor who owed Epstein favors, and who could be relied on to provide cash at Epstein's behest. Black has an MBA from Harvard, making donations to his alma mater look slightly less suspicious. But they do seem to follow the same pattern.
Illustration: Eniola Odetunde/Axios
The April jobs report comes tomorrow, writes Axios' Courtenay Brown. It will be almost incomprehensibly grim.
Why it matters: The report will tell us a lot of what we don't know about the coronavirus-ravaged job market: How widespread the job losses are by industry and demographic, how many layoffs are temporary, and whether worker pay has been cut.
The headline number will be the unemployment rate, which is expected to hit 16%. The best estimate for peak unemployment during the Great Depression is that the number hit 25%.
Of note: You're only counted as unemployed if you're actively looking for work. But because of state-imposed lockdowns, many Americans aren't looking for work.
The bottom line: Economists warn the key figures from the report may understate the devastation of job losses.
"88 Holes," 2020. Image via MSCHF
The final bid for "88 Holes," the Damien Hirst print with all the spots cut out that I wrote about last week, came in at $261,400.
Photo: John MacDougall / AFP via Getty Images
Berlin has some amazing architecture from the Cold War era, but the Zentrale Tierlaboratorien — universally known as the "Mäusebunker," or Mousebunker — is undeniably one of the most striking buildings of the period.
The Mousebunker is currently slated for demolition. A petition to save it has almost 5,000 signatures.