What Banks Tell Us About Covid-Era Business: ‘Everybody Is, Bluntly, Struggling’: David Benoit, WSJ, July 18, 2020
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Battling COVID-19 and Economic Meltdown, Israel Now in a Third Crisis: of Faith
David Horovitz
Times of Israel, July 16, 2020The numbers are rising, seemingly inexorably: Israel at this writing has almost 25,000 “active” COVID-19 cases, compared to just 2,000 eight weeks ago. The death toll in that period has risen from 281 to 380. Most strikingly, the number of serious cases has soared from 37 eight weeks ago to 56 just two weeks ago to 204 at this writing.We may have thought we had COVID-19 beat. We didn’t.
Along with the health crisis, we are battling economic collapse. Unemployment, below 4 percent in March, hit 25 percent three months ago, then came down to some 20% but is now rising again. Many businesses failed to make it through the “first wave.” Many that did, and hoped they saw a light at the end of the tunnel when the government began reopening the economy eight weeks ago, have been hit by the oncoming train of COVID’s return.
But Israel is facing a third crisis, too — one that is now deeply hampering the national effort to grapple with this infuriating pandemic: a crisis of faith.
Early in the battle, Israelis saw the medical experts and the economic mavens arguing on our TV screens about how to find the balance between preventing our health service from becoming overwhelmed by a mass of COVID-19 patients and reducing the catastrophic impact of shuttering the economy. And we saw Prime Minister Benjamin Netanyahu, who had spotted the COVID-19 dangers early, seeking to steer what struck us as a prudent middle course.
Today, though, Israelis’ confidence in the entire stewardship of this battle has collapsed.
For part of the public, Netanyahu himself was and is never to be trusted. The thousands of Israelis who protested, some of them violently, outside the Prime Minister’s Residence and elsewhere on Tuesday night were representing an anger that predates COVID-19 — their opposition to his being prime minister at all, given that he is on trial for corruption. Their ranks could only have been swollen by the prime minister’s blockheaded insistence, at the height of this crisis, on having the Knesset Finance Committee devote a three-hour session last month to his successful bid to obtain some $270,000 in tax rebates and benefits.
But the crisis of faith extends far, far beyond that.
It is driven in part by those numbers — the hard, harsh statistics — that show Israel, having “flattened the curve,” is now diving deeper into COVID’s second wave.
Multiple plans, minimal strategy
It is fueled by the authorities’ abiding failure to provide financial relief for the quarter or so of the Israeli workforce who can no longer earn a living. Plan after economic plan has been grandiosely unveiled, by Netanyahu, his Finance Minister Israel Katz and their various officials. And plan after economic plan has missed its mark — beset by bureaucratic red tape, channeling too much to undeserving sectors of the economy, channeling too little to those who need it most.
The latest idea, unveiled by Netanyahu in a TV appearance on Wednesday night, may be well-intentioned, or it may be cynical election economics, but it certainly constitutes an abdication of responsibility. The prime minister intends to immediately funnel NIS 6 billion ($1.75 million) in handouts to all Israelis, irrespective of need, arguing that this indiscriminate showering of cash is vital in order to jumpstart the economy. Were he to introduce caveats and clauses to the handout, he said, the squabbling would start, the red tape would mount, and nothing would get done. “We must now give universal support to everyone in order to move the wheels and so that nobody falls between the cracks,” he asserted. … [To read the full article, click the following LINK – Ed.]
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High Tech Industry Will Lead Economy Out of Corona Crisis
Ran Puni
Israel Hayom, July 16, 2020
Israel’s reputation as the “startup nation” precedes it. Over the past 20 years or so, the Jewish state has welcomed the opportunity to position itself as a global force in the field of technological innovations – something that, when all is said and done, comes down to the local mindset, mentality, and morals of hundreds of entrepreneurs who seek to spearhead various fields in the high tech industry.
High tech is one of the main growth engines for the Israeli economy. In fact, the past decade has seen it finalize 1,210 mega-deals amounting to 385 billion shekels ($111 billion). The total exits value throughout the 2010-2019 decade represents an 800% surge in exits value and a 50% increase in the number of overall deals materialized from the previous decade.
Seeking to propel Israel’s startup nation status forward, the Israel Innovation Authority, previously known as the Office of the Chief Scientist at the Economy Ministry, has evolved into an independent, publicly funded agency, whose mission statement is to “provide a variety of practical tools and funding platforms aimed at effectively addressing the dynamic needs of the local and international innovation ecosystems.”
Israel Innovation Authority Director Aharon Aharon describes himself as a “worrier on the national level.” He recently sat down with Israel Hayom to discuss what lies ahead for the startup nation as the economic fallout from coronavirus crisis is starting to pummel Israel’s legendary high tech sector.
Q: It seems as if we’re failing in the little things, and our tech nation is once again under restrictions because we haven’t been able to put together epidemiological research. Maybe we aren’t as advanced as they tell us we are?
“We’re always moving in two lanes: one, which is vital, is the long-term strategy for Israeli innovation, whose goal is to prepare for future challenges. The other aspect is toward a methodological, systemic, and built-in system of activity with Israeli companies. I don’t criticize activity I’m not familiar with, I can say that when activity is subject to oversight, management, and is consistent and coherent, all sides involved can predict the results and manage them – both in terms of strategic decisions and how to implement them.”
Q: Google, Samsung, Apple, and Microsoft all invest in the healthcare field. World expenditure on healthcare is up dramatically and is estimated to reach $10 trillion by 2022. How did we find ourselves in the situation that in 2020 a single virus brings the world to a standstill?
“What are all these companies interested in? The connection between the data element, figures, because they deal with data, and healthcare systems. There is a close link between the sophisticated use of information in making healthcare systems more efficient. When it comes to corona, we didn’t have enough information. The economy has become closely tied to heath, and in global terms, we are seeing the world economy come to a stop. That’s because we didn’t know much about the virus that arrived from China.” … [To read the full article, click the following LINK – Ed.]
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China and Iran Must Be Made to Pay For COVID-19 Cover-Up: Canadian Report
Jonathan Bradley
National Post, July 17, 2020
Although this situation is still developing, there is compelling evidence that both Chinese and Iranian regimes buried evidence of the pandemic in its critical early days, choosing to attempt to maintain power and/or stability at the cost of the health and safety of their own citizens and the global population,” writes Sarah Teich, an expert in human rights and security law.
“They are accused of intentionally underreporting data, concealing the extent of the outbreak from the international community and from their own citizenry, and silencing whistleblowers at the expense of protecting public health.”
The report “Not Immune – Exploring liability of authoritarian regimes for the COVID-19 pandemic and its cover-up” was released by the Ottawa Macdonald-Laurier Institute and the Canadian Security Research Group.
It cites a study by the University of Southampton suggesting that if interventions in China had been conducted three weeks earlier than they were, COVID-19 cases could have been reduced by 95 per cent.
Li-Meng Yan, a virologist at the University of Hong Kong, fled to the United States in April after alleging the Chinese government withheld research critical to understanding COVID-19, concealed the virus, and threatened to silence whistleblowers, says the report.
The Iranian government has also been accused of burying evidence, underreporting data, and sacrificing the health and safety of people to maintain power and stability.
China and Iran likely breached their international legal obligations in international agreements, such as the International Covenant on Economic, Social, and Cultural Rights, the World Health Organization’s International Health Regulations, the Rome Statute of the International Criminal Court, and the Biological Weapons Convention.
The Rome Statute might have been breached because withholding critical health information could be classified as a crime against humanity. The Biological Weapons Convention may have been violated because COVID-19 could be viewed as a biological weapon.
Governments can rely on international organizations such as the UN Office of the High Commissioner for Human Rights, the Director-General of the WHO, the International Criminal Court, and the UN Security Council to punish China and Iran.
The process for filing a claim with an international organization against China and Iran would start with a country initiating a complaint against them. These international organizations could then pursue an investigation, writes Teich.
Accountability can also be sought in Canadian and American legal systems. These options include suing China and Iran in domestic courts, seeking accountability from Chinese and Iranian companies in Canada using the Canadian Quarantine Act, implementing economic sanctions using the Special Economic Measures Act in Canada and the International Emergency Economic Powers Act in the U.S., sanctioning officials under the Magnitsky Acts, and passing novel legislation to address liability for COVID-19.
Teich said it might be tough to sue China and Iran in domestic courts because of sovereign immunity. Foreign states are often not subject to decisions from domestic courts, but it could happen in Canada through the terrorism exception.
A final possible avenue that can be explored is to hold Chinese officials accountable through their legal system. Chinese officials may have breached the Frontier Health and Quarantine Law of the People’s Republic of China and the Criminal Law of the People’s Republic of China. … [To read the full article, click the following LINK – Ed.]
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What Banks Tell Us About Covid-Era Business: ‘Everybody Is, Bluntly, Struggling’
David Benoit
WSJ, July 18, 2020
Big banks expect the coronavirus recession to cut a wide swath through corporate America.
When they reported second-quarter earnings this past week, big U.S. lenders said they don’t expect the U.S. economy to pull out of its slump soon. A protracted downturn, bank executives said, bodes poorly for all manner of American businesses, even those not directly affected by the travel bans and social-distancing measures put in place to curb the virus.
From the first quarter to the second, the four biggest American banks nearly doubled the amount of money they set aside to cover soured corporate loans. It was different in the first quarter, when banks increased provisions for consumer loans far more.
Even what looked like good news wasn’t really. Investment-banking revenue soared in the second quarter. But the gains didn’t come from advising CEOs on deals; rather, banks raked in fees helping companies stockpile cash to ride out the downturn.
“Everybody is, bluntly, struggling,” Bill Demchak, chief executive officer of PNC Financial Services Group PNC -1.88% Inc., said on an earnings call Wednesday. “The generic corporate client we talk to, who’s otherwise open and doing business, is almost without exception down from what they would have expected going into the year and down from where they were last year.”
Banks have unrivaled visibility into the health of the U.S. consumers and businesses. They guard deposits, engineer mergers and lend money. They see how much is going into customer accounts, how much is going out and where money is being spent.
In the second quarter, they saw some alarming things. One by one, bank executives warned that the worst of the coronavirus recession has yet to come. They said they no longer expect a quick snapback in economic activity or employment.
“I don’t think anybody should leave any bank earnings call this quarter simply feeling like the worst is absolutely behind us and it’s a rosy path ahead,” Citigroup Inc. Chief Executive Michael Corbattold analysts Tuesday. “I don’t want to be pessimistic…I want to be a realist.”
The four biggest American banks— JPMorgan Chase & Co., Citigroup, Bank of America Corp. and Wells Fargo & Co.—set aside $33 billion in the second quarter to cover loans that could go bad. Corporate lending accounted for $16.8 billion of it, up from $8.8 billion in the first quarter. (Bank of America set aside less for loan losses than the other banks. Chief Executive Brian Moynihan said early signs of a rebound are encouraging.)
JPMorgan, the biggest U.S. bank by assets, set aside $4.6 billion for commercial loan losses, up from $2.4 billion in the first quarter. It kept its consumer provision flat at $4.4 billion. … [To read the full article, click the following LINK – Ed.]
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For Further Reference:
Israeli Economy Shrinks by 7.1% In Q1 over Coronavirus: Reuters and ILH Staff, Israel Hayom, May 26, 2020 — Israel’s economy contracted by an annualized 7.1% in the first quarter, the Central Bureau of Statistics said on Monday, with the coronavirus outbreak hitting trade, investment and consumer and government spending. It was the first quarterly contraction of gross domestic product in Israel since 2012.
WATCH: Netanyahu under Pressure of Coronavirus and Economy: CNN – CNN’s Oren Liebermann reports on the current state of Israel and Prime Minister Benjamin Netanyahu as the coronavirus pandemic puts pressure on the county.
Israel’s Central Bank Chief Backs New Coronavirus Economic Aid Plan: Avi Waksman, Haaretz, July 12, 2020 — Bank of Israel Governor Amir Yaron told the cabinet Sunday that he supported the new coronavirus economic package, even though it would widen the budget deficit this year to a yawning 13% of gross domestic product.
The Corona Offensive: Jason Shvili, Israel Hayom, July 19, 2020 — Back in April, as our government was beginning to ease some restrictions on the economy that were put in place to stop the spread of COVID-19, I said that easing those restrictions was a bad idea.
June’s Job Increase Shows Canada’s Economy Continues on its Long Path to Recovery: Corey Renner, The Conference Board of Canada, July 14, 2020 –– Employment rose by 952,900 in June, another sign that the worst of the pandemic’s economic toll is now behind us. When June’s employment increase is added to May’s increase of 289,600, just over 1.2 million of the 3 million jobs lost due to COVID-19 have now been recovered.
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This week’s French-language briefing is titled: Communiqué: Réponse au coronavirus: de l’ État, encore de l’ État, toujours plus d’ État. (17 juillet,2020)
