White House Economic Advisor Larry Kudlow says that the country is squarely in the middle of the “v-shaped” recovery that everyone had hoped for, and despite reports of coronavirus hotspots popping up, shutting down the economy for a second time would make the “solution worse than the disease.”
Kudlow spoke on “Fox and Friends” yesterday and said that the White House is monitoring the jump in new coronavirus cases in states like California, Arizona, Texas and Florida, but added that as a country we now know what works to stop the spread, and just need to work together.
“We know the right mitigation, which has worked, and if we use that wholeheartedly and respect each other, I think we’ll get out of this pretty well and it will not stop the V-shaped recovery.”
On A Second Shutdown
He added that a second shut down would be a “really big mistake.”
“Another shutdown, in itself is controversial,” and would “do more harm than good,” said Kudlow before adding, “It would harm everyone. Not just businesses — the V-shaped recovery would give way. It would harm kids, we saw numbers on depression, drinking and so on… that solution would be worse than the disease.”
Kudlow highlighted the job growth in the last two months, and pointed out that jobs are being added back so quickly, workers are now quitting jobs to search for new, higher-paying ones.
He said there existed a “tremendous burst of jobs in May and June” and “tremendous record hiring rates. People are starting to quit their jobs again, which is extraordinary, in order to shop around for better jobs and wages.”
All those workers looking for jobs should bring down the unemployment rate to as low as 7% iby the end of the year, according to St. Louis Federal Reserve President James Bullard.
That would be quite a rollercoaster ride for the job market, which has swung from a 50-year low unemployment rate of 3.5% earlier this year, to a post-WWII high of 14.7% in April.
U.S. Economy Doing “Very Well”
Appearing on “Closing Bell” yesterday, Bullard said “I think we’re tracking very well right now. Seems to me like by the end of the year you can get down certainly to single digits, probably even below 8%, maybe 7% by the end of the year.”
A surge in new cases could slow the re-hiring of workers across the country, but Bullard believes that wearing a mask will become standard and that will help bring back jobs and boost the economy.
“If we get to that situation, we’ll have the disease under control,” he said. “What I like about that scenario is it does not rely on a vaccine coming or a therapeutic coming. We can use simple, easy technology that we have today, get a good situation, get most of the production back to normal.”