Newsletter: Rolling Back Reopenings

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Rolling Back

States and cities grappled with how to contain the coronavirus while trying to reopen their economies as the number of infections in the U.S. climbed to more than 3.8 million. Chicago Mayor Lori Lightfoot said the city was tightening restrictions on some businesses. Los Angeles Mayor Eric Garcetti said his city is on the brink of returning to shutdown mode. California added San Francisco County to its county watch list. Educators in hard-hit Florida moved to halt the state’s school reopening plans. Mississippi State Health Officer Dr. Thomas Dobbs said 31 legislators have contracted the virus and that there is only a single bed available in the intensive-care units of the Jackson metro area’s four biggest medical centers, Allison Prang and Jennifer Calfas report.

On the good news front: The number of new coronavirus cases in the U.S. rose at the slowest pace in a week. And New York City entered its fourth and final phase of reopening on Monday with the resumption of outdoor venues, though some lockdown restrictions, including a ban on indoor dining, will remain in effect.

WHAT TO WATCH TODAY

The Senate Banking Committee is scheduled to vote on the nominations of Judy Shelton and Christopher Waller to the Federal Reserve at 2 p.m. ET.

President Trump holds a press conference at 5 p.m. ET.

Japan’s Jibun Bank composite index for the first weeks of July is out at 8:30 p.m. ET.

TOP STORIES

The Final Countdown

European Union leaders agreed on a €1.8 trillion ($2.06 trillion) spending package aimed at containing an unprecedented economic downturn. The package, built around the bloc’s first-ever issuance of hundreds of billions of euros of common debt, came together early Tuesday after four days of talks. The agreement represents a significant step in the EU’s move toward a more genuine fiscal union. Some have hailed it as the bloc’s Hamiltonian moment, referring to Alexander Hamilton, the first U.S. Treasury secretary, who had the federal government absorb the debts of U.S. states. Some economists, however, say the cash may only make a modest difference to revive depressed economies, Laurence Norman reports.

Republicans outlined their priorities for the next round of coronavirus aid, calling for legal protections for businesses and money to reopen schools but no new funding for states and cities. Senate Republicans are expected to unveil their bill later this week at a critical moment in the coronavirus pandemic, with cases increasing in many states and new signs that the economic recovery may be stalling. Senate Democratic Leader Chuck Schumer said Monday that a bill that didn’t include new aid for states and cities was a nonstarter, Kristina Peterson, Andrew Restuccia and Catherine Lucey report.

The Senate on Monday confirmed former conservative activist Russell Vought to be director of the White House Office of Management and Budget, a role he has held in an acting capacity since March, Paul Kiernan reports.

Back-to-school goes DIY. Parents, daunted by a flurry of hybrids of virtual and in-person lessons, are making their own plans. Some parents are pooling their children together and paying for tutors, others are exploring outdoor classes, Anne Marie Chaker reports.

While the government debates its next steps, time is running out for many restaurants. Government aid has run out, and breaks from landlords and suppliers are coming due as fewer diners are willing to eat inside. Thousands of restaurants have closed so far, and as many as 10% of independent operators could shut by year’s end as a result of the new coronavirus, Heather Haddon reports.

Silver and Gold

The price of silver rose for the ninth time in 12 sessions Monday, hitting a nearly four-year high with investors flocking to precious metals during the economic uncertainty caused by the coronavirus pandemic. Prices are up 8.5% so far in July and have surged 71% from a low hit in mid-March, lifted by the steady haven buying that also has powered gold to a multiyear peak. Front-month gold futures added 0.4% to $1,815.90 a troy ounce on Monday, logging their highest close since September 2011. Gold is within 4% of its record hit that year, Amrith Ramkumar reports.

Another haven? Cold, hard cash. The number of $100 bills in circulation outnumbered $1 bills for the first time on record in 2017. The gap has widened each year since, according to data from the Federal Reserve. Over the past decade, $100 bills in circulation have more than doubled while singles are up by less than one third. Another possibility for rising demand for high-denomination bills: an expanding underground economy.

TWEET OF THE DAY

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WHAT ELSE WE’RE READING

If high-skill workers can’t migrate to jobs, the jobs migrate to high-skill workers. “Skilled immigration restrictions may have secondary consequences that have been largely overlooked in the immigration debate: multinational firms faced with visa constraints have an offshoring option, namely, hiring the labor they need at their foreign affiliates. If multinationals use this option, then restrictive migration policies are unlikely to have the desired effects of increasing employment of natives, but rather have the effect of offshoring jobs. Combining visa data and comprehensive data on U.S. multinational firm activity, I find that restrictions on H-1B immigration caused foreign affiliate employment increases at the intensive and extensive margins, particularly in Canada, India and China,” the University of Pennsylvania’s Britta Glennon writes in a new working paper.

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