Trump Threatens Post Office As Way To Settle Amazon Score

that Bloomberg dot com. Well. As we dig deeper into the two point four trillion dollars stimulus bill the US Congress past, we are finding all sorts of interesting provisions. One highlighted my President Trump himself the idea that there would be ten billion dollars that would go to the US Postal Service to help support and plug some of

the gaps that have emerged in the wake of the coronavirus. However, President Trump saying that unless the Postal Service raises its prices, particularly on last mile delivery packages, it will instruct Secretary Treasury Secretary Stephen Manuchin to withhold that ten billion dollars. Tim O'Brien, who's a senior columnist with Bloomberg Opinion, joining us now. Tim always wonderful to hear what you have to say about this. How much of a surprise was

this to people who saw President Trump pinpoint this specific issue. Um. I don't think it's a surprise that you know, he wants he's seeking change at the Postal Service. The Postal Service needs change. Uh. Nor is it a surprise that he's focused in again on the pricing the Postal Service charges for packages. However, the way he's focusing on it is incorrect. The package delivery piece of the post Office is business, is its most robust and profitable. It's mail

carrying that's a problem for the post Office. I think what was surprising was he was in the Oval Office and he simply said what everyone has suspected has been on his mind for a long time, is that he singled out Amazon dot com as as one of the reasons he has um this animosity towards the Postal Service. President Trump has said that the Postal Service loses money on every package is that delivers. Is that right? Nope,

it's not correct. Again, that's a that's a very profitable part of the postal services business and has been, you know, alongside the boom and e commerce. Uh. The Postal Service plays a really important role for commercial deliverers like FedEx and US and ups um delivering packages through the so

called last mile to people's homes. It's not efficient or really profitable for the commercial carriers to use, so they rely on the post post office for that, and that has been a really bright spot in the postal services business. Over the last fourteen to fifteen years or so, mail carrying has really declined, and that's always been the lions share. The post Office is business and that's where they're really hurting, and that's what they need to fix. So the president's

identifying the wrong thing. Tim, I want to switch gears a little bit and move from the postal service to just the general two point four trillion dollar bailout, In particular, the p p P the area that was in did

to help support small businesses. How good is the oversight of that program, Given the fact that we're learning that a good proportion of the money has gone to either publicly traded companies or others who had other means of financing, it's clearly not good enough at all, Lisa, and this was something I think we talked about a couple of weeks ago when the first tranche of money launched the

first billion. Um uh. You know, I personally think it's a good idea that we're we're supporting businesses in this crisis, but I think it has to be supported in a really efficient and rational way. And the problem with that first big trunch of money, as we now know, is it went to people who had either other resources, other companies that have other resources to raise funds, or we're simply too big to fit any of the definitions that program had for a small business, which was five hundred

employees or left. Um. I think based on my own back of the envelope math, only about five percent of the country's small businesses got money in that first round. And so now we have a second round that's larger billion, and there's still really isn't enough good oversighting place. The General Accountability Office is going to be um watching some

of this. They're, you know, very well regarded bipartisan organization, but they don't report until the end of June at the earliest, and all of the other congressional and White House watchdog organizations aren't up and running yet. I was struck by a story today on the Bloomberg about study that showed that only of the money went to small businesses in areas that were the hardest hit by the coronavirus.

Is your sense that this next tronch of financing that starts getting distributed this week will be more equally distributed? One would hope there's not enough transparency yet to know. And and so that's a great question you're raising LESA, and it's and and the and and Bloomberg News is reporting on that is is really important. I think the other thing we don't know is p p P is

a payroll protection plan. It's meant to help workers get over this hump during this crisis, and we really don't have any auditing arm in place to know if the companies are even actually using it for payroll. And I have this, you know, lingering, journalistic, cynical kind of worry that at the end of the day, will never know if a god to the workers. So what should happen here? Tim from an oversight perspective, real quickly twenty seconds, um, I think I think it should happen at the federal

level in the White House to begin with. I think they need to screen right out of the gate who's getting the money, and there should be really clear criteria for why and how they're getting it and how they're going to use it. Tim O'Brian, thanks so much for joining us. We appreciate your thoughts. As always Tim O'Brian's senior columns for Bloomberg Opinion. Check out his column UH today on the Bloomberg and Bloomberg dot Com. Trump views post office as a way to settle scores. Interesting column,

interesting take on that on a big issue. There you can read all of Tim's work at Bloomberg dot com, slash Opinion or on the terminal at O P I n go for all of Bloomberg Opinion work. Well, we are now in probably week five or six of this quarantine, more and more of us working from home. The question is, are we more or less productive than we are when we are in our workplace? Uh Nicholas Bloom, professor of economics at Stanford University, has done a lot of work

on this concept. We welcome uh Professor Bloom. So professor, thanks so much for joining us. I know initially your work suggested that working from alms actually you could be more productive. Is that's still the case in the world of the coronavirus. Yes, I looked at you know, a number of studies, and normally working from home is at least to a big increase in productivity. But we're coronavirus. We've got four big issues. One many of us have

our kids are home, which is she's distracting. Uh open, don't have our own and so a lot of people are staring living room. When I looked at working from home, we looked at people who chose to work from home, and you know, many of us did not show him would not like to do so. And then finally, um, we also looked at working from home part time, so something like of Americans with a graduate from home a day a week, but only super century full time. But

we're now all forced at home full time. I will say, Nick, in a research recent research published that you you put out there. You said working from home with your children as a productivity disaster. My four year old regularly bursts into the room hoping to find me in a playful mood, shouting do do her nickname for me? In the middle

of conference calls. We've all been there, Nick, And I'm wondering how much is this simply a parenting issue versus a non parenting issue or something broader about this idea of being more productive when you're face to face with coworkers and in an office environment. So there is a big issue, may you know, I thought year does burst in in fact, why you know, our older kids are learning to play the bagpipe, and though which is worse.

Even setting that aside, there's a bigger issue. Once we go back post COVID, around one third of jobs only are suitable to work from home. So there's a study out of Chicago University that looked at jobs and you know, for managers, for a senior people, you know, for journalist for example, much of this can be done at home, but the large parts of the economy we can't do that. So for some of us it's fantastic when our kids are back at school and when we have you know,

space and time. But I don't think it's ever going to be like it was now, which is free time. It turns out the evidence is strongly needs something like three days a week to be in the office to be motivating and creative. And the problem is now we just don't have that eye that's not even kids. There's

no face efface interactions. So professor, I mean, some people have been suggesting that this is going to accelerate the work from home kind of Um, I guess migration that's been taking place really over the last ten fifteen years. Do you think that is reasonable to assume. Yes, definitely. So we we went from before COVID from a level of working from homers it was common one day a week, but it was extremely rare full time obviously even now

all working from home full time to post COVID. But I think we're just back to a higher level, but a lot like we are now. So I think it would be most jobs will probably allow their employees to work from home something like two I doubt memory encourage all the time. And that's going to have a huge impact. Even how attractive is it to live in the center, don't have to commute in five those weeks, why not further out? So I think it's just going to be

a huge impact. Um. You know. A great example is London after the London Olympics two thousand and twelve, they shot the center of London for three weeks to avoid congestion and those sort of mtic long run pickup and working from home because of the success that I think, because it's kind of like a bigger at so Nick,

there's this question. The reason why this is so important to so many people right now, in addition to just what the future holds for people who do have the privilege of being able to work from home, is the fate of commercial real estate going forward? And you've had a lot of business leaders from Work in Stanley CEO to Black Black Rocks CEO come out and say that they think one of the bigger consequences of this is

that companies will need less real estate. Does this sort of mark the death of commercial real estate, of the sort of big office given the fact that people will be able to work from home more frequently, or are those calls getting a little ahead of themselves. No, I think it's a you know, it's a bleak time for commercial real estate and also actually residential real estate in the center of cities. If we go from you know,

working from home, that is very rare. So let's say two out of five days a week you continue, you probably need school blessed office space even can't perfectly hot death stands that, you know, that kind of top and demand, it's going to be problematic. It's not obvious by the way you want still maintain big officers. I just think we need less of them unless those headquarters. So that's going to be a big switch. If you look at firms that do working from home, they don't typically operate

smaller satellite officers. They just required people are coming less presently to their may not. Nicholas Bloom, thank you so much for being with us, and good luck working from home with the kids and the bagpipes. Nicholas Bloom, professor of economics at Stanford University, joining us from Stanford, California. We know this too, cute. G D print is going

to be ugly. The question is how ugly and how long will it remain at those depressed levels of Welcome Tom or Like, chief economist for Bloomberg Economics, he joins us on the phone. Tom, thanks so much for joining us. I know Bloomberg Economics is that with some new research. What is your update and current economic outlook as we await the second quarter GDP print. Um, So it's a pretty bleak outlook, Paul Um. Globally we are now looking at a contraction of four for the year. That's our

base case. UM. Now, if we think back to two thousand and nine, the Great financial crisis that was a pretty bad year. The global economy that year only shrank, not point two. So our base case is actually something substantially more negative. If we look in more detail at the United States, looking at the looking at the first quarter number, well, it kind of depends how much the lockdown hit. It came right at the end of March. We'll see how much it it took off that first

quarter of print. The second quarter, certainly we're looking at a very steep contraction. Our US team is penciling in a thirty seven annualized drop in the second quarter. I'm struggling to pair these increasingly bleak outlooks with the optimism that we're seeing in markets right now, at least in equity markets, and a lot of people are saying traders are just looking past the second quarter and even the third quarter and looking into the fourth quarter when we

should get a resurgence in economic activity. I'm wondering how much that's your base case that we're not going to get necessarily a second wave of the coronavirus and we'll get meaningful pickups in growth heading towards September, November, December. Yeah, I think that's a great question question Lisa and I to see a disconnect between some fairly bleak or rather historically bleak economic numbers coming down the line UM and the and what's going on in the equity market UM.

So our base case is the eytbreak comes under control in the second quarter, and we see a reasonably rapid pick up in the third quarter as lockdown's ease. Now that's our base case, but it comes with some unusually large caveats UM. The first one is what happens to the virus. Well, it seems like from what happened in China, a lockdown can be successful in essentially permanently bringing it

under control. But we don't know if that can be replicated around the world, and we don't even really know if it will stick in China, So it's entirely possible we could see cases popping back up again in the third and fourth quarter, a lockdown coming back in in the final weeks and months of the year, and even our four percent contraction calls for global GDP could turn out to be too pessimist, too optimistice, Sorry, carry on, pool go ahead, Sorry, I was The second big risk

is well, we think that the underlying economy is actually okay, and so once you get rid of the virus and you get rid of the lockdown, people can come back to work and growth comes back pretty quickly. That's actually also an optimistic assumption. We're seeing twenty six million people losing their jobs in the United States, similar impact across other big economies, businesses going bankrupt. It's possible that this is going to be a scarring recession and high unemployment.

Business bankruptcies, perhaps even some bank failures are going to mean that the recovery in the third and fourth quarter intoe just isn't that robust. So time just quickly. How bad do you think this unemployment rate is going to be? And then I guess how permanent? I guess you were kind of touching on that a little bit. How permanent do you feel like it will be? Are we at

a higher level of just annallywing unemployment going forward? So we think that the unemployment rate in the second quarter is going to push close to um that's an extraordinarily high level. Back in the Great Financial Crisis, it got to so we're looking at a really really high level

of unemployment. The question for the longer term is, well, have businesses just said, Okay, take a break, we'll call you in three months, and when the lockdown is over, people can basically get back to work and its business

as usual. Or are we looking at a more damaging break in the labor market if we see people being furloughed and then those furloughs turning into permanent unemployment, and that's going to be a much more serious drag on output, and we'd be looking at a creeping recovery in the second half and into Tom more like thank you so much for being with us, Tom, or like chief economists for a Bloomberg Economics joining us from Washington, d C. In five weeks, the US labor market erased what took

more than a decade to build more than twenty six million jobs lost as the coronavirus rereaked havoc across the United States. We're expecting millions more in the filing initial jobless filings come Thursday. A question about how quickly these jobs will return and what businesses could and should and would be doing to bring these people back online as we get signs that the virus is subsiding. James Sinclair on the front lines of all of this chief executive

officer of Enterprise Alumni based in Los Angeles. James, you talk with employers, how much are they planning for the reset, the post coronavirus re jiggering of the economy as they try to get a greater proportion of their employees back online. Good morning, Lisa, Thanks for having me. You're absolutely right.

So we work with some of the largest companies in the world, and we're seeing this massive influx of new customers across retail and tourism, travel, and so we do have a good pulse of what's next and what's needed to restart, and we are seeing a lot of organizations

leveraging Enterprise Alumni to start their rehiring plan. This concept of who's available um not only people who used to work for them just before the crisis, but also historically and their ability to be able to ramp up very quickly by using alumni or former employees who used to work for the organization. So, James spaced upon kind of what you're hearing some of the companies that you talked to.

How quickly do you think this restart will occur, will be a gradual type of thing, or are these companies chomping at the bit. So I think there are two conversations. Number one, it's how do we manage the community today? All of these people that we followed, all these people that we need to communicate with and place into a central resource to have that conversation. But I think people are chomping at a bit is almost an understatement. I

think we're all chumping at a bit. And the question is what does that recovery look like and how are they going to potentially make up for lost time? But how are they going to start really quickly? Because they can't afford a three to four week productivity cycle. They need people that are going to hit the ground running. Uh. And so to that to a lot of customers we're speaking to, that tends to be the biggest priority now that when we get the go ahead or the green light,

how can we scale up very very rapidly. James, we're talking about the jobs market in the United States as though we're a modelist, and obviously so not. In different industries have gotten hit harder than others. I know that your company makes software that are used that's used by a variety of different companies and industries. NESTLYE p and G. Marriat HSBC. I'm wondering how specific will the restart be

two companies that are better positioned to weather this. In other words, could we see everyone get back online yet the hotels remain with furload employees for a lot longer. I think from what we're seeing from the staffing plans that organizations are leveraging in our in our application is that it is going to be gradual, that even though there's going to be a green light and a mass

re higher, it is going to be industry specific. You take the airlines overnight, They're not suddenly going to have fil rates on their planes, same as occupantcy for hotel, same as restaurants. Just because the market is reopening, it doesn't mean everyone's going to feel comfortable suddenly going to a sports game, going to a conference, or jumping on a plane. So so they are expecting that when they

do reopen, they're going to reopen as smaller organizations. So jameson, how about some small business owners We've seen, you know, a lot of pain there on Main Street USA. Any sense of how they are trying to manage to do this, how they plan on reopening once they do get that green light. I think the smaller and medium sized businesses across the US, this is really going to be leveraging their community, leveraging all the goodwill they've built over the

number of years. You know, we're hoping that as many businesses as possible will survive post this, but I think the recovery is going to be really again leveraging this community. So again, whether you're a small business or a large cust a large customer of ours, you're still thinking about that network and all the people that used to work for you that you've had a relationship with, because also

right now they become your brand advocates. We see a lot of customers right now recognizing that the ad spend is so small, So how can we leverage all of our former employees to push our messaging, push our programming and kind of give us the reach that we would normally have to pay for. James how much goodwill, though, has been lost for some of these employees who have

lost their jobs. So I think this becomes company to company where this is an opportunity to really see the type of organization for what they are, their culture and their values. We have one retail company that has whisked up a platform for Enterprise Alumni for all of their former employees, for all of those furloughed, and one of the things they're doing is every week the CEO is doing a town hall talking to them about what's happening in the market, what they can expect, how they might

up skill. We have another customer in tourism who is offering all of their furloughed employees access to an MBA program, access to learning, access to skills. So I think you're seeing a lot of companies using this opportunity to a be great employers and ensure they're offering those furloughed employees access to resources to help them up skill and be better post crisis, but also be great communicators because none of us really you know, you know what that date

is for for rebound. Jameson Claire, thank you so much for joining us. We appreciate you talking to us about how when the governments and corporations reopen, how will they staff themselves. James Sinclair, CEO of Enterprise Alumni based in Los Angeles, So at least that's gonna be very interesting.

I'm really focused on kind of these small and midsized businesses you know, yeah, yeah, I hope that they can uh survive this, and you hope some of those fiscal stimulus actually gets to them, uh to help them bridge the gap and then uh, you know, when they do get the green light, you know how many of them will be able to come back. That's gonna be really key.

It's such a complicated process, I gotta say. And to sort of predict how many employees you may need, knowing that the people you don't hire won't be able to go out and spend and accelerate the economy bends your mind. Yeah, it really does. It really does. And that we've never had this economy obviously has never had to do anything like this, I would argue, even with the Great Depression. So we'll have to see how this plays out. But key is going to be fiscal stimulus, and we're gonna

get some more is on that this week. This is Bloomberg. Thanks for listening to the Bloomberg pen L podcast. You can subscribe and listen to interviews at Apple Podcasts or whatever podcast platform you prefer. I'm Paul Sweeney, I'm on Twitter at pt Sweeney. I'm Lisa Abram Woyds I'm on Twitter at Lisa Abram woits one before the podcast, you can always catch us worldwide. I'm Bloomberg Radio