🎥 Check it out! I worked with the Axios video team to create this 1-minute video on how COVID-19 will forever change the U.S. economy.
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🎙“Once social change begins, it cannot be reversed. You cannot un-educate the person who has learned to read. You cannot humiliate the person who feels pride. You cannot oppress the people who are not afraid anymore.” - See who said it and why it matters at the bottom.
Illustration: Aïda Amer/Axios
U.S. farmers are fighting for their livelihoods as the coronavirus pandemic slashes commodity values, cuts off supply chains, and closes markets around the globe to their products.
Why it matters: Farmers are at the center of industries being hardest hit by the virus and states' stay-at-home orders.
What's happening: Already reeling from the trade war — which cost farmers significant revenue from China, the world's largest U.S. agriculture buyer — the COVID-19 outbreak has wrought a situation the American Farm Bureau Federation's chief economist John Newton calls simply "catastrophic."
What we're hearing: "It seems like we’re fighting a battle on all fronts right now," Newton tells Axios.
Where it stands: There were high hopes that China's commitment to $200 billion of increased spending on U.S. agriculture, energy, manufacturing and services as part of the "phase one" trade deal would help make farmers whole. But as the virus outbreak rattled Chinese demand, those planned purchases evaporated.
Yes, but: Direct payments to farmers and ranchers totaling $16 billion along with $3 billion in product purchases were authorized as part of the $2 trillion CARES Act.
Yes, but, but: Industry groups' anticipated losses far exceed that total. The beef industry says it expects to lose $13.6 billion, pork producers expect to lose $5 billion, and the dairy industry anticipates $2.85 billion in losses.
Uncertainty overwhelmed the agriculture sector in 2019 as farm debt hit a record high and so-called family farmer bankruptcies rose by the most in eight years, up 20% from the previous year.
In 2020 things have gotten worse. Farmers now face declining prices and demand, shortages of labor, and disruptions to processing facilities and labor markets.
Ending business shutdowns in early April could have led to an additional 172,000 deaths over the course of the pandemic, but the closures are likely to push the U.S. unemployment rate above 30% in the second quarter, according to the St. Louis Fed.
Starbucks will launch a plant-based lunch menu featuring Beyond Meat, which will set up a Chinese-language website and use Weibo and WeChat. (Reuters)
The Federal Housing Finance Agency is considering allowing Fannie Mae and Freddie Mac to buy home mortgages in forbearance. (WSJ)
Between price declines and investor redemptions, the value of stock mutual funds and ETFs held by U.S. investors declined by $3.6 trillion during the first quarter.
By the numbers: The decline in equity fund value during the quarter is over $700 billion more than was seen in 2008 during the Great Recession.
On the other side: Institutional and retail money market funds drew $702 billion of inflows during the quarter, more than the inflows for the entire year in 2008.
After Monday's historic crash during which U.S. benchmark WTI crude futures fell below $0 for the first time ever and settled at -$37 a barrel, panic has continued to spread through markets, with Brent crude prices falling by more than 20%.
Why it matters: While some attributed Monday's unprecedented price deterioration in WTI to technical factors like expiring monthly contracts, the losses continue even on later-dated contracts for June and July. Prices for both Brent and WTI are now below $20 a barrel.
The big picture: Tuesday's declines happened despite a decision by CME Group, the world’s largest commodities exchange, to raise margins on crude futures and an announcement from President Trump that the U.S. was “looking” to add as many as 75 million barrels of oil to the Strategic Petroleum Reserve.
Netflix stock came back to earth in after-hours trading on Tuesday after jumping as much as 10% following the company's sublime first quarter earnings report.
The big picture: Netflix has probably been the biggest beneficiary of nationwide lockdown orders that have resulted from the COVID-19 pandemic.
The intrigue: With at least 80 S&P 500 companies having simply chosen not to provide guidance for 2020, Netflix said it expects 7.5 million new global paid subscribers in Q2, but warned the number was “mostly guesswork."
The Senate passed a nearly $500 billion coronavirus relief bill on Tuesday after more than a week of intense negotiations.
Why it matters: The agreement will replenish the emergency small business lending Paycheck Protection Program (PPP) and provide billions for hospitals and expanded coronavirus testing, Axios' Alayna Treene notes.
Details: This version of PPP includes a total of $322 billion for businesses, of which $60 billion will be set aside for small institutions.
What's missing: The deal does not include $150 billion in aid for state and local governments sought by Democrats.
Editor’s note: The top story was corrected to show overall demand for U.S. agriculture exports has declined (not imports). Story 5 was corrected to show Netflix had a revenue of $5.77 billion (not million).
Quote: “Once social change begins, it cannot be reversed. You cannot un-educate the person who has learned to read. You cannot humiliate the person who feels pride. You cannot oppress the people who are not afraid anymore.”
Why it matters: Cesar Chavez, a prolific labor organizer who led a more than five-year boycott of grapes that at one point included 17 million people and produced the California law allowing farm workers to unionize, died on April 22, 1993.