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| Fed Suggests Tough Road Ahead as It Pledges to Help Insulate Economy | Fed Suggests Tough Road Ahead as It Pledges to Help Insulate Economy |
| (32 minutes later) | |
| Jerome H. Powell, the Federal Reserve chair, struck a worried tone at his first regularly scheduled news conference since the coronavirus shuttered the United States economy, calling the job losses taking hold “heartbreaking” and predicting a long road ahead. | Jerome H. Powell, the Federal Reserve chair, struck a worried tone at his first regularly scheduled news conference since the coronavirus shuttered the United States economy, calling the job losses taking hold “heartbreaking” and predicting a long road ahead. |
| Mr. Powell, who had been presiding over the longest economic expansion on record, has watched as the strongest labor market in generations slipped away. More than 26 million workers have lost jobs as quarantines and lockdowns close businesses, sapping the fuel from a consumer-driven economy. | Mr. Powell, who had been presiding over the longest economic expansion on record, has watched as the strongest labor market in generations slipped away. More than 26 million workers have lost jobs as quarantines and lockdowns close businesses, sapping the fuel from a consumer-driven economy. |
| While much of that pain could prove temporary, the world’s most important economic leader sounded an alarm that the recovery could be slow and halting — and that the damage virus containment efforts have inflicted on the economy could be especially painful for the most vulnerable. | While much of that pain could prove temporary, the world’s most important economic leader sounded an alarm that the recovery could be slow and halting — and that the damage virus containment efforts have inflicted on the economy could be especially painful for the most vulnerable. |
| “We were hearing from low- and moderate-income and minority communities that this was the best labor market they’d seen in their lifetime,” he said. “It is heartbreaking, frankly, to see that all threatened now. All the more need for our urgent response, and also that of Congress.” | “We were hearing from low- and moderate-income and minority communities that this was the best labor market they’d seen in their lifetime,” he said. “It is heartbreaking, frankly, to see that all threatened now. All the more need for our urgent response, and also that of Congress.” |
| Mr. Powell promised that the Fed would push its powers to their limit to help the economy, keeping rates low and funneling credit into crucial markets. But he also made it clear that elected policymakers must do their part to keep households and businesses from falling too far behind, and underlined repeatedly that the stakes were high, particularly for the job market. | Mr. Powell promised that the Fed would push its powers to their limit to help the economy, keeping rates low and funneling credit into crucial markets. But he also made it clear that elected policymakers must do their part to keep households and businesses from falling too far behind, and underlined repeatedly that the stakes were high, particularly for the job market. |
| “Longer and deeper downturns have left more of a mark, generally,” Mr. Powell said. “That’s why the urgency in doing what we can to prevent that longer-run damage. It doesn’t have to be that way.” | “Longer and deeper downturns have left more of a mark, generally,” Mr. Powell said. “That’s why the urgency in doing what we can to prevent that longer-run damage. It doesn’t have to be that way.” |
| Mr. Powell’s Fed has staged a whatever-it-takes response to the coronavirus crisis, slashing interest rates to near zero, rolling out a gigantic bond-buying program to soothe troubled markets and setting up a series of emergency lending programs to keep credit flowing to businesses and households. | Mr. Powell’s Fed has staged a whatever-it-takes response to the coronavirus crisis, slashing interest rates to near zero, rolling out a gigantic bond-buying program to soothe troubled markets and setting up a series of emergency lending programs to keep credit flowing to businesses and households. |
| Officials on Wednesday pledged to keep rates near rock bottom for the foreseeable future and to use their “full range of tools” to help the economy to climb back. But Mr. Powell stressed that the central bank could not perfectly counter the crisis at hand. | Officials on Wednesday pledged to keep rates near rock bottom for the foreseeable future and to use their “full range of tools” to help the economy to climb back. But Mr. Powell stressed that the central bank could not perfectly counter the crisis at hand. |
| “Lowering interest rates cannot stop the sharp drop in economic activity caused by closures and other forms of social distancing,” Mr. Powell said. He later added that the Fed “can continue to be part of the answer,” but “it may well be the case that the economy will need more support from all of us.” | “Lowering interest rates cannot stop the sharp drop in economic activity caused by closures and other forms of social distancing,” Mr. Powell said. He later added that the Fed “can continue to be part of the answer,” but “it may well be the case that the economy will need more support from all of us.” |
| He highlighted the need for fiscal policies that protect businesses and households from “avoidable insolvency.” | He highlighted the need for fiscal policies that protect businesses and households from “avoidable insolvency.” |
| The Fed’s announcement came just hours after a government report showed that the economy contracted at a 4.8 percent annualized rate in the first quarter. While that was the worst reading since 2008 and ended the record-long expansion, it probably barely scraped the surface of the coronavirus damage. Lockdowns started only toward the end of the quarter. | The Fed’s announcement came just hours after a government report showed that the economy contracted at a 4.8 percent annualized rate in the first quarter. While that was the worst reading since 2008 and ended the record-long expansion, it probably barely scraped the surface of the coronavirus damage. Lockdowns started only toward the end of the quarter. |
| The contraction is expected to look even worse in the three months through June, but what will happen after that remains extremely uncertain. States and cities are tiptoeing toward a reopening, but that process could take months. It is also unclear when consumers will feel comfortable enough to return to shopping malls and concerts, let alone travel for work or pleasure. | The contraction is expected to look even worse in the three months through June, but what will happen after that remains extremely uncertain. States and cities are tiptoeing toward a reopening, but that process could take months. It is also unclear when consumers will feel comfortable enough to return to shopping malls and concerts, let alone travel for work or pleasure. |
| Fed officials warned that the economy may be in for an unsteady journey back to growth and prosperity. Mr. Powell said second-quarter economic data would be “worse” than anything previously seen, that it might take consumers time to feel comfortable spending again, and that companies and workers might need additional financial help. | Fed officials warned that the economy may be in for an unsteady journey back to growth and prosperity. Mr. Powell said second-quarter economic data would be “worse” than anything previously seen, that it might take consumers time to feel comfortable spending again, and that companies and workers might need additional financial help. |
| In their post-meeting release, Fed officials flagged “considerable risks to the economic outlook” over the medium term, suggesting central bank officials did not anticipate growth to bounce back quickly in the “V-shaped” recovery that President Trump and some other administration officials still seemed to expect. | In their post-meeting release, Fed officials flagged “considerable risks to the economic outlook” over the medium term, suggesting central bank officials did not anticipate growth to bounce back quickly in the “V-shaped” recovery that President Trump and some other administration officials still seemed to expect. |
| “They are giving some insight into how they see the trajectory for the economy, which is not a V-shaped path,” said Michelle Meyer, head of U.S. economics at Bank of America. “They’ll keep interest rates low for a long time, they’ll err on the side of being more accommodative, rather than less.” | “They are giving some insight into how they see the trajectory for the economy, which is not a V-shaped path,” said Michelle Meyer, head of U.S. economics at Bank of America. “They’ll keep interest rates low for a long time, they’ll err on the side of being more accommodative, rather than less.” |
| The central bank has some room to maneuver even with rates at rock bottom. | The central bank has some room to maneuver even with rates at rock bottom. |
| Congress has handed the Treasury Department $454 billion to back up Fed emergency lending programs, which can help businesses, states and cities gain access to credit. Less than half of that funding has been earmarked, and not all of the programs the Fed has announced are up and running yet. | Congress has handed the Treasury Department $454 billion to back up Fed emergency lending programs, which can help businesses, states and cities gain access to credit. Less than half of that funding has been earmarked, and not all of the programs the Fed has announced are up and running yet. |
| Mr. Powell suggested on Wednesday that the Fed’s two corporate bond programs would begin buying debt soon, and that the Fed would lay out revised plans for its midsize business program, which is supposed to help companies that are too big for forgivable small business loans but too small to readily access capital markets. | Mr. Powell suggested on Wednesday that the Fed’s two corporate bond programs would begin buying debt soon, and that the Fed would lay out revised plans for its midsize business program, which is supposed to help companies that are too big for forgivable small business loans but too small to readily access capital markets. |
| Updated June 22, 2020 | Updated June 22, 2020 |
| A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico. | A commentary published this month on the website of the British Journal of Sports Medicine points out that covering your face during exercise “comes with issues of potential breathing restriction and discomfort” and requires “balancing benefits versus possible adverse events.” Masks do alter exercise, says Cedric X. Bryant, the president and chief science officer of the American Council on Exercise, a nonprofit organization that funds exercise research and certifies fitness professionals. “In my personal experience,” he says, “heart rates are higher at the same relative intensity when you wear a mask.” Some people also could experience lightheadedness during familiar workouts while masked, says Len Kravitz, a professor of exercise science at the University of New Mexico. |
| The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth. | The steroid, dexamethasone, is the first treatment shown to reduce mortality in severely ill patients, according to scientists in Britain. The drug appears to reduce inflammation caused by the immune system, protecting the tissues. In the study, dexamethasone reduced deaths of patients on ventilators by one-third, and deaths of patients on oxygen by one-fifth. |
| The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave. | The coronavirus emergency relief package gives many American workers paid leave if they need to take time off because of the virus. It gives qualified workers two weeks of paid sick leave if they are ill, quarantined or seeking diagnosis or preventive care for coronavirus, or if they are caring for sick family members. It gives 12 weeks of paid leave to people caring for children whose schools are closed or whose child care provider is unavailable because of the coronavirus. It is the first time the United States has had widespread federally mandated paid leave, and includes people who don’t typically get such benefits, like part-time and gig economy workers. But the measure excludes at least half of private-sector workers, including those at the country’s largest employers, and gives small employers significant leeway to deny leave. |
| So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement. | So far, the evidence seems to show it does. A widely cited paper published in April suggests that people are most infectious about two days before the onset of coronavirus symptoms and estimated that 44 percent of new infections were a result of transmission from people who were not yet showing symptoms. Recently, a top expert at the World Health Organization stated that transmission of the coronavirus by people who did not have symptoms was “very rare,” but she later walked back that statement. |
| Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks. | Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks. |
| A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study. | A study by European scientists is the first to document a strong statistical link between genetic variations and Covid-19, the illness caused by the coronavirus. Having Type A blood was linked to a 50 percent increase in the likelihood that a patient would need to get oxygen or to go on a ventilator, according to the new study. |
| The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April. | The unemployment rate fell to 13.3 percent in May, the Labor Department said on June 5, an unexpected improvement in the nation’s job market as hiring rebounded faster than economists expected. Economists had forecast the unemployment rate to increase to as much as 20 percent, after it hit 14.7 percent in April, which was the highest since the government began keeping official statistics after World War II. But the unemployment rate dipped instead, with employers adding 2.5 million jobs, after more than 20 million jobs were lost in April. |
| States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people. | States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people. |
| Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days. | Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days. |
| If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.) | If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.) |
| If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others. | If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others. |
| If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested. | If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested. |
| But the central bank cannot make grants, and even its lending powers are constrained to fairly healthy borrowers. | |
| Treasury Secretary Steven Mnuchin, who must sign off on the programs, has indicated that he is not willing to take risks that lead to major losses. | Treasury Secretary Steven Mnuchin, who must sign off on the programs, has indicated that he is not willing to take risks that lead to major losses. |
| “I think it’s pretty clear if Congress wanted me to lose all of the money, that money would have been designed as subsidies and grants as opposed to credit support,” Mr. Mnuchin told reporters on Wednesday. | “I think it’s pretty clear if Congress wanted me to lose all of the money, that money would have been designed as subsidies and grants as opposed to credit support,” Mr. Mnuchin told reporters on Wednesday. |
| Mr. Powell indicated that he would defer to Mr. Mnuchin on matters of credit risk, but also said the Fed was ready to use whatever it had at its disposal, even if those abilities were somewhat limited. | Mr. Powell indicated that he would defer to Mr. Mnuchin on matters of credit risk, but also said the Fed was ready to use whatever it had at its disposal, even if those abilities were somewhat limited. |
| “The path of it is highly uncertain, but we will be there with our tools, supporting the economy and supporting that recovery,” Mr. Powell said. “We can do what we can do, and we will do it to the absolute limit of our powers.” | “The path of it is highly uncertain, but we will be there with our tools, supporting the economy and supporting that recovery,” Mr. Powell said. “We can do what we can do, and we will do it to the absolute limit of our powers.” |
| Alan Rappeport contributed reporting. | Alan Rappeport contributed reporting. |