Welcome to the Good News/Bad News Edition Let’s start with the good news, so those who want to stay positive can stop after that.
The Conference Board’s consumer confidence index rose to 101.8 in September from August’s reading of 86.3. This represents the largest one-month increase in 17 years, and the highest reading since the pandemic began in March. This figure was also much higher than
economists were expecting.
While confidence is still well below pre-coronavirus levels (it was at 132.6), this is certainly good news, especially since it comes after two straight monthly declines.
Lynn Franco, Senior Director of Economic Indicators at The Conference Board stated “A more favorable view of current business and labor market conditions, coupled with renewed optimism about the short-term outlook, helped spur this month’s rebound in confidence. Consumers also expressed greater optimism about their short-term financial prospects, which may help keep spending from slowing further in the months ahead.”
In case you fell asleep reading that quote, she is saying consumers are staying positive despite the lack of a new stimulus. This is especially good news for the economy, since consumer spending accounts for roughly two-thirds of GDP.
Another bit of good news came from JPMorgan Private Bank, who is forecasting the S&P 500 will rise around 10% over the next 12 months. Industrial, construction materials, technology and health care stocks were identified as sectors primed for growth.
For those worried about the election’s impact on stocks, JPMorgan Private Bank’s Grace Peters said it’s “unlikely to materially drive share prices.” Let’s hope she’s right about that.
And now for the bad news…
According to Bloomberg, 610 businesses filed for bankruptcy in the Southern and Eastern Districts of New York from March 16 to September 27. This figure is 40% higher than the same period a year ago.
Even more depressing is that according to Yelp, almost 6,000 NYC businesses closed between March 1 and September 11, with over
4,000 expected to close permanently.
If you’re wondering why 6,000 business closed yet only 610 bankruptcy filings happened, it’s because small business owners rarely file for bankruptcy, choosing to walk away instead.
You can read the full Bloomberg piece here, which is chock full of scary pandemic numbers like these:
According to the Partnership for New York City, as many as one-third of New York’s 230,000 businesses could close permanently.
The Partnership also reports that as of late September, only 15% of NYC’s office workers had returned.
According to Square, a digital payment provider, their Manhattan businesses are earning just 62% of their pre-pandemic revenue.
Since we probably could all use a drink now, I’ll stop there.
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