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(Today's Smart Brevity count: 1,197 words, 4.5 minutes.)
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Illustration: Eniola Odetunde/Axios
The Congressional Budget Office estimated Friday that the U.S. budget deficit will be roughly $3.7 trillion for fiscal year 2020, with public debt projected at 101% of GDP — and that was before the "phase four" $484 billion relief package passed by Congress late last week.
Why it matters: In a world of historically high income inequality and historically low productivity and growth, in which debt levels were already historically high, the U.S. and the world at large are in wholly unprecedented territory.
Driving the news: Following the $2.2 trillion CARES Act and the "phase four" relief package, Congress has signaled there is still much to do, with various "CARES Act 2" proposals in the pipeline.
Goldman Sachs researchers in a note Sunday said they expect Congress to approve another $550 billion before the 2020 fiscal year ends in September, plus untold spending on infrastructure, direct payments and unemployment benefits to come in fiscal year 2021.
Between the lines: Already, critics of the government spending have started to emerge from all sides...
The big picture: Economists have warned for years that excessive government spending would crowd out private investment and drive interest rates higher, choking off growth and undermining the economy.
The nonpartisan CBO was the latest to reveal economic projections that throw cold water on hopes for a V-shaped U.S. economic recovery.
Given the expected weakness in the economy and drastic increases in federal spending, the CBO projects the U.S. annual deficit will rise to 17.9% of GDP this year, and to 9.8% of GDP in 2021.
Chinese central bank governor Yi Gang wrote in an article that the impact from the coronavirus on China's economy will be short-lived, and warned that "too aggressive" stimulus measures may bring inflation risks and cause too rapid an increase in leverage. (Bloomberg)
The Bank of Japan held a one-day meeting and said it will shift to unlimited purchases of Japanese government bonds and increased yearly buys of corporate bonds and commercial paper. (Bloomberg)
Illustration: Sarah Grillo/Axios
Axios' Kyle Daly writes: As Google, Facebook, Apple, Amazon and Microsoft all report their first set of pandemic-affected earnings this week, the industry will get a clearer fix on just how much pain the falling-out between the U.S. and China will inflict.
The big picture: For decades, tech's leaders have bet big on China as a manufacturing hub, supply chain provider and, increasingly, a lucrative market — but trade frictions, national-security tensions, and now coronavirus blame games are imperiling that partnership.
Why it matters: If the "great decoupling" that was already underway pre-virus gets accelerated by the crisis, tech is bound to get caught in the middle.
Commercial exports: The U.S. remains the global powerhouse in semiconductors, home to giants including Intel and Qualcomm.
Exploring Chinese consumer markets: China has been a key growth region for some U.S. companies, like Apple.
"The basic question for the U.S. in dealing with the China relationship is whether the American state can govern," said Matt Stoller, a China critic and research director at the American Economic Liberties Project.
After seeing IHS Markit's readings on the depths of the decline in Britain's manufacturing and services sectors, Bank of England governor Gertjan Vlieghe warned that the U.K. may be in the grips of an economic contraction for the ages.
Driving the news: IHS Markit said Thursday that its U.K. composite purchasing managers index (PMI), which tracks both services and manufacturing, fell to 12.9 in April, down from 36 in March, which was the previous record low since the survey began in the 1990s.
In just a few months, the coronavirus pandemic has destroyed so much fuel demand it has created a world in which there is a glut of oil with nowhere to put it, my former boss David Gaffen writes for Reuters.
Why it matters: "While the unusual circumstance of negative oil prices may not be repeated, many in the industry say it is a harbinger for more bleak days ahead, and that years of overinvestment will not correct in a period of weeks or even months."
What's happening: The combination of years of oversupply and plunging demand means oil wells are filling up quickly.
What they're saying: “What happened in the futures contract the other day indicated things are starting to get bad earlier than expected,” Frederick Lawrence, VP of economics and international affairs at the Independent Petroleum Association of America, tells Reuters.
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Quote: “I know where I’m going and I know the truth, and I don’t have to be what you want me to be. I’m free to be what I want.”
Why it matters: Today is the fourth day of the Islamic holy month of Ramadan and for the next few weeks I'll be spotlighting quotes from extraordinary Muslims throughout history. Today's quote comes from boxing legend and civil rights icon Muhammad Ali aka "The Greatest."