United Airlines, big SFO employer, may lay off 36,000 workers - Printable Version
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United Airlines, big SFO employer, may lay off 36,000 workers - Griffins78 - 07-08-2020
Think this is an indicator that our unemployment numbers have been artificially lower by some of the CARE funding.
Quote:The company cannot furlough workers before Oct. 1 because of restrictions on the $5 billion in aid the company received under the federal CARES Act.
https://www.sfchronicle.com/business/amp/United-Airlines-big-SFO-employer-may-lay-off-15394320.php
RE: United Airlines, big SFO employer, may lay off 36,000 workers - OutsiderFan - 07-09-2020
I'd love to know how many jobs are being propped up only by borrowing from the Federal Government, in the form of direct Fed Asset purchases, that should never ever be allowed, IMO.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - BostonCard - 07-09-2020
(07-09-2020, 08:10 AM)OutsiderFan Wrote: I'd love to know how many jobs are being propped up only by borrowing from the Federal Government, in the form of direct Fed Asset purchases, that should never ever be allowed, IMO.
Why shouldn't the government be allowed to support jobs by borrowing?
BC
RE: United Airlines, big SFO employer, may lay off 36,000 workers - Genuine Realist - 07-09-2020
(07-09-2020, 09:04 AM)BostonCard Wrote:We move - inevitably - towards Universal Basic Income, which was an idea, the time of which had come anyway.(07-09-2020, 08:10 AM)OutsiderFan Wrote: I'd love to know how many jobs are being propped up only by borrowing from the Federal Government, in the form of direct Fed Asset purchases, that should never ever be allowed, IMO.
Why shouldn't the government be allowed to support jobs by borrowing?
BC
RE: United Airlines, big SFO employer, may lay off 36,000 workers - OutsiderFan - 07-09-2020
(07-09-2020, 09:04 AM)BostonCard Wrote:(07-09-2020, 08:10 AM)OutsiderFan Wrote: I'd love to know how many jobs are being propped up only by borrowing from the Federal Government, in the form of direct Fed Asset purchases, that should never ever be allowed, IMO.
Why shouldn't the government be allowed to support jobs by borrowing?
BC
I have no problem with the Federal Government borrowing money to spend on things when there are bond buyers to finance the spending or it raises taxes to make people realize nothing is free. My issue is when the Fed creates money out of thin air to be that buyer. It's even worse when the Fed buys up other assets, like mortgage securities and who knows what else.
Investing is suppose to create winners and losers. That's what leads to responsible long-term behavior and keeps markets tied to reality. What if the Fed goes and buys up all the over leveraged fracking debt? It's creating money that drives down the value of yours, so investors who made dumb bets on energy can't lose.
Now for sure, I agree with supporting the Air Line industry. It's as integral part of economic infrastructure. But, again, that should never be done by the Fed printing money. It should be done by raising taxes, cutting spending other places, and selling more treasuries to investors. Just saying "oh, the Fed will print money and we'll use it to support airlines (and other stuff) so we don't have to make hard choices," is lazy and totally irresponsible. It's like putting led pipes in a school because you couldn't tell the truth about how much it would cost to have non-led pipes in it. Sure, it might be expedient in the near term, but the long term cost will be tremendous, all because of an ability to face unpleasant reality in the present.
The Fed, the Executive Branch, and our Congress have failed to protect us in spectacular fashion, even while mortgaging our futures. We've basically run on a treadmill for 4 months and not only made no progress, but made things worse for ourselves. It's like doing the work to get in shape and being more out of shape after doing it. It's hard to even comprehend how absurd this is.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - BostonCard - 07-09-2020
The issue was one of liquidity, which is exactly what the Fed is supposed to address. In early March, you had a unique situation in which both stocks and bonds (and gold, and other commodities) fell simultaneously, just as companies were drawing down their lines of credit. That's not supposed to happen; generally when people sell stocks because they are worried about risk, they buy bonds. What happened is that everyone was hoarding cash. When this happens, the Fed has to "print money" so that everyone can calm themselves down that there will be plenty of cash to go around. Since then, the markets have stabilized substantially.
What happened is not only ok, it prevented a massive financial crisis in which every asset froze up.
This emergency podcast by Planet money when the FEd announced the steps it was taking is worth a listen to:
https://www.npr.org/2020/03/16/816684372/episode-980-the-fed-fights-the-virus
BC
RE: United Airlines, big SFO employer, may lay off 36,000 workers - OutsiderFan - 07-09-2020
Yes, the Fed is the "buyer of last resort." I get that. I'm just making a point around how I don't think propping up the current system that has given us the society we have and led us to our current reality, is worth saving. It's kind of like what Nationals Pitcher Sean Doolittle said. Sports are suppose to be a reward for a high functioning society. Similarly, I would argue anyone being able to live comfortably should be a reward for everyone being able to live with certain opportunities and protections.
Covid pandemic out of control and infecting millions of Americans with who knows what long-term cost. Mortgaged to our eyeballs in debt. More than 30 million unemployed. Only 47% of working age adults full-time employed. Climate Change accelerating. Racism dividing us. Historic income inequality. Government failing to protect its citizens because it literally can't function to address the nation's problems. Stanford cutting 11 sports :)
Someone make an argument for why "the system" is worth saving and I'll listen.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - BostonCard - 07-09-2020
(07-09-2020, 11:00 AM)OutsiderFan Wrote: Yes, the Fed is the "buyer of last resort." I get that. I'm just making a point around how I don't think propping up the current system that has given us the society we have and led us to our current reality, is worth saving. It's kind of like what Nationals Pitcher Sean Doolittle said. Sports are suppose to be a reward for a high functioning society. Similarly, I would argue anyone being able to live comfortably should be a reward for everyone being able to live with certain opportunities and protections.
Covid pandemic out of control and infecting millions of Americans with who knows what long-term cost. Mortgaged to our eyeballs in debt. More than 30 million unemployed. Only 47% of working age adults full-time employed. Climate Change accelerating. Racism dividing us. Historic income inequality. Government failing to protect its citizens because it literally can't function to address the nation's problems. Stanford cutting 11 sports :)
Someone make an argument for why "the system" is worth saving and I'll listen.
I thought this was the logic for the "Flight 93 election" in 2016. I can give you my thoughts on why throwing out an imperfect system won't solve all your problems, but that would probably fall afoul of the Terry rule.
Keeping it COVID-19 related, if you think our response has been sub-par now, imagine trying to do anything in the midst of a collapsing politico-economic system. Forget high level tasks like contact tracing. There is no guarantee that in such a system the hospital system would even hold up, given how the worst affected are covered by Medicare and thus require a functioning government to have health insurance.
I have lots of complaints about our current system, but I fail to see how "burn it all down" would be an improvement.
BC
RE: United Airlines, big SFO employer, may lay off 36,000 workers - Griffins78 - 07-09-2020
I wasn't thinking about surreptitious motivations behind the requirements for loans or the loans themselves, though I'm certain there were some. I was primarily looking at the reporting of unemployment as an indicator of how the "economy" is doing and its influence on investors. This was an indicator that the unemployment status of many people is being artificially unreported because they cannot be laid off or furloughed until a specific date required by PPP or other stimulus/bailout checks. That is an overhang that when it is released could negatively impact the market.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - fullmetal - 07-10-2020
Would it really affect the market though? The market knows all this and is still near its February highs. Some stocks have hit record highs. It's pretty clear that equities are no longer tied to economic fundamentals...(the stock market, as they say, is now merely "rich people's feelings").
Agreed that the govt has just put this debt on the shoulders of future generations. This is why pandemics should have remained a national security priority and also why the CDC early warning apparatuses should never have been defunded.
I expect some consolidation in the airline industry in a few months. AA and UA going back to full flights (no distancing) is a desperate move toward sustainability that may still not even pay off.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - OutsiderFan - 07-10-2020
There is a second level of the employment structure that is at great risk, anything that relies on people getting together, and the people who work in those businesses or related to them. Sports, entertainment, events, hotels & resorts, bars, and restaurants are all on the brink of hemorrhaging millions of jobs beyond what has already been lost.
The pro sports that can get paid to play for TV can maybe get going, but higher education, live entertainment, and corporate events simply aren't happening. My SO says she now doesn't see any events until at least Q2 of 2021 and she is now at risk of losing her job. This was after she had a month ago started working on an event in Charleston, SC for October that was recently cancelled.
We haven't come close to seeing the end of the economic hits from our national disaster.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - Mick - 07-11-2020
(07-09-2020, 11:00 AM)OutsiderFan Wrote: Yes, the Fed is the "buyer of last resort." I get that.
I think the Fed should be the lender/buyer of first resort. The rapidly-approaching/already-in-progress economic implosion will require it. They're already buying corporate bonds. Why shouldn't they lend for mortgages or car loans or (god help us) payday loans? Why should there be an ultra-profitable finance industry that makes money off the backs of hardworking Americans?
RE: United Airlines, big SFO employer, may lay off 36,000 workers - chrisk - 07-11-2020
The jobs are being supported primarily by a grant ($3.5 billion). The loan portion is smaller. The grant was made in the hopes that after October more people would be required. Some people will have jobs and some will take buyouts but many will go on the direct public dole. It only makes sense for the feds to give free money to United if there is some hope the jobs will come back soon.
RE: United Airlines, big SFO employer, may lay off 36,000 workers - 82lsju - 07-21-2020
United layoffs last week, in the WARN filings most show as "temporary layoffs" but not all states differentiate between permanent and temporary layoffs
in California WARN filings last week United announced they will have the following layoffs
- LAX - 1,634
- John Wayne Airport - 65
- San Diego - 149
- SFO - 6,573
in Colorado WARN filings
- Denver - 2,820
in Virginia WARN filings
- Dulles - 3,036
- Arlington - 116
Illinois WARN filings are only updated on-line through the end of June but I'd expect more at ORD
RE: United Airlines, big SFO employer, may lay off 36,000 workers - chrisk - 07-21-2020
unemployment schemes US vs Europe
https://www.schwab.com/resource-center/insights/content/stock-market-reaction-to-expiring-covid-19-programs?cmp=em-QYD