The U.S.’s escalating coronavirus crisis prompted New York and California to sharply restrict movement within those states, with the Trump administration moving to support consumers and businesses as the economic fallout deepens.
California became the first state late Thursday to deploy a statewide stay-at-home order, with New York following suit on Friday, after a power struggle between Governor Andrew Cuomo and New York City Mayor Bill DeBlasio.
Across the world, the case count is nearing 250,000, with the death toll rising past 10,000. On Thursday, Italy’s death toll officially surpassed China’s, and the government was forced to tighten already strict lockdown measures to contain the casualty count.
The United Kingdom also moved to lock down the country, with Prime Minister Boris Johnson ordering the closure of cafes, pubs and restaurants.
India’s Prime Minister Narendra Modi has requested citizens heed a curfew of 7 a.m. to 9 p.m. daily, but has not yet implemented a lockdown. Canada’s Prime Minister Justin Trudeau said he would consider stricter rules but is currently asking Canadians to heed social distancing measures.
With states and cities enforcing lockdowns, and some companies having already shut down stores or cut operations, American life has been drastically altered within the space of a week. Markets have reacted violently, and economists expect global growth to suffer this year.
“We need to meet this moment and flatten the curve together,” California governor Gavin Newsom said on Twitter.
Cuomo ordered all nonessential employees to stay home, exempting only pharmacies, grocers, health care workers and other essential workers. He also detailed a list of other scenarios individuals should avoid in order to prevent spreading or contracting COVID-19.
The Empire State has quickly become the front line in the U.S.’s battle to contain a relentless surge in coronavirus diagnoses, having logged more than 4,500 of the country’s 14,000 cases. In a recent interview with Yahoo Finance, New Jersey Gov. Phil Murphy said he would consider stricter measures than what has already been rolled out in the state, working with other governors in neighboring states.
Meanwhile, President Donald Trump and his advisors have been working with Congress to hammer out a massive stimulus package expected to top $1 trillion. On Friday, Treasury Secretary Steven Mnuchin announced that the April 15 deadline to file taxes had been pushed out to July 15.
The administration is planning to send checks to most citizens, and are trying to prioritize individuals who cannot work from home but would need to stay at home to avoid the virus, or care for loved ones. The payment is expected to be in excess of $1000 per person, but details have been fluid.
No recovery until August?
The coronavirus’ toll on the economy has been nothing short of devastating, as economists warn a recession is already under way — and growth prospects for 2020 are all but gone.
Joel Prakken, chief US economist at IHS Markit said on Friday that a “recovery from the looming economic contraction begins in August, by which time we expect the rate of new cases of coronavirus disease 2019 (COVID-19) to be dwindling and quarantines, official and self-imposed, to be lifting.”
He added: “It is not until the fourth quarter that a firm rebound takes hold.”
Markets, which have plunged as the crisis reaches a boiling point, have largely wiped out the gains made during Trump’s first term. On Friday, investors gave up an early rally and sent benchmarks lower in the wake of New York’s lockdown order.
Goldman Sachs and Bank of America both issued bleak unemployment forecasts, as retailers and service providers are forced to lay off entire staffs. In a bright spot, some companies like Walmart (WMT) and Papa Johns (PZZA) have announced big hiring plans, as the mass of people working from home stock up on household items and selectively order takeout.
Health care squeezed
Meanwhile, the health sector remains under pressure. The increased case count, a result of more widely available testing, is putting a strain on hospitals which are already busy with flu season and others.
Facing shortages in protective gear, ventilators and struggling to access testing, the effects have been compounded by the reduction in elective procedures where hospitals and physicians tend to make money.
Department of Veterans Affairs Secretary Robert Wilkie recently said the VA could step up to help with the hospital burden by working with the Department of Defense to deploy ships and field hospitals — which is already planned for New York’s spiking cases.
The VA has a vast network of health facilities— nearly 170 hospitals alone— to provide capacity. Former VA Sec. David Shulkin told Yahoo Finance recently that the agency’s hospitals and outpatient centers can help back up traditional health systems in an outbreak.
Meanwhile all eyes are on big companies working on testing, treatment and vaccine solutions, such as Gilead Sciences (GILD). On Friday, the pharma giant began another clinical trial in New York for its potential antiviral treatment.
Anjalee Khemlani is a reporter at Yahoo Finance. Follow her on Twitter: @AnjKhem
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