Happy lockdowns and what not to watch on TV

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Afternoon all,

Hope you’re all feeling suitably relieved now that the Donald has cracked this virus thing. Didn’t see the injecting disinfectant suggestion coming, but at least we now know why he’s that colour.

Much more reassuring news came from the retail sales stats today (not from the unsurprising record headline fall obviously). A recent run of zoom meetings with booze-free lockdown-types was raising my anxiety levels, so it’s good to hear that alcohol sales are up by over 30 per cent. Emulating Father Jack during these grim times feels a lot less unacceptable now I know the rest of you are at it too.

Have a good weekend and stay safe.

Chief Executive
Resolution Foundation

Fake news: We already know that fake news can have damaging consequences – and if we didn’t, burning 5G masts might have been a pretty big clue. But a new and very bleak report from the States looks at the relation between the information given out on two different Fox News shows, and the severity of coronavirus outbreaks in different parts of the country. One of the two shows (‘Hannity’) was originally dismissive of coronavirus, while the other (‘Tucker Carlson Tonight’) was warning viewers of the virus from early February. The study finds that counties with a higher viewership of Hannity vs. Tucker Carlson were more likely to have severe outbreaks of the virus. Once ‘Hannity’ shifted tone to also express concern about the virus, the different trajectories of the outbreak between counties started to correct. Now it’s very early days for coming to firm conclusions about the complex causes of different outbreaks in different places. But the paper’s a reminder of why we should be particularly concerned about the very real dangers of misinformation during a pandemic. For more on how to cure viral disinformation, check out this BBC podcast.

Times change: Everyone keeps calling this crisis ‘unprecedented’ before (understandably) comparing it to very familiar history, in particular the financial crisis. But in reality a pandemic-driven crisis is very different to one driven by the financial sector, as this piece by Barry Eichengreen reminds us. It makes a crucial point for thinking ahead to the coming stages of this global trauma: while the financial crisis mainly hit large, advanced economies with developed financial systems, those that will suffer most from the coronavirus pandemic are likely to be low-income countries with weaker health systems. Ensuring that doesn’t get ignored while we’re all understandably focused on our own plight must be a priority.

Chillax about Helicopters: Writing about helicopter money and monetary financing of government debt is definitely having a moment – and for good reason, with the Government racking up an extra £225 billion in financing requirements just for the first four months of this year. This take from Adair Turner points out that monetary finance might not end up being so explicit. Many of the Bank of England’s operations – like quantitative easing – could result in some element of monetary finance if they never unwind totally. But he’s chillaxed because this shouldn’t lead to Zimbabwe-style hyperinflation if decisions over it remain in the hands of the central bank. For a view from inside the Bank of England read MPC member Gertjan Vlieghe’s thoughtful speech yesterday.

Happy lockdown? It’ll come as a surprise to literally no-one that who you’re spending (a lot more) time with in lockdown can have significant effects on your happiness. A new paper takes a look at pre-crisis data on how the people we spend time with affect our overall happiness levels. In general, for those who are married, time spent together correlates with higher levels of life satisfaction (optimistic). For those who are single, time spent alone correlates with lower satisfaction. The paper suggests that a lockdown with increases in both time together for couples, and time alone for singles, could increase the wellbeing of the former, but reduce that of the latter. It goes on to say that any happiness increase for couples would be largely offset by the impact of falling work and incomes. Personally, I can’t help thinking there are some huge gaps in the analysis, such as the Godzilla of wellbeing killers… home schooling. Some alone time might be more appealing than the researchers think.

Global pandemic, local spending: We’re all spending less at the moment given income shocks as well as lockdown measures. But this fall in consumption looks very different in different places. That’s the key takeaway from this new Tortoise article, which uses data from high street banks to see which parts of the country have seen the biggest spending falls. Key lesson = tourist and university towns (Oxford, Brighton, York and Canterbury) have seen particularly severe falls in spending. Tourist hotspot Penzance in Cornwall has seen an 85 per cent drop in non-grocery spending. You basically don’t want to be a shop where people used to travel to in order to spend, so thriving city centres are also seeing some of the biggest consumption falls. It’s hard enough keeping up with the national picture at present. But understanding what’s happening where is crucial to getting policy right now and in the recovery to come.

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Can a policy be both mind-bogglingly big, and smaller than you thought it might be at the same time? Yes, we learned this week, when applications to the Government’s Job Retention Scheme went live. Business surveys have consistently indicated around 7-9 million workers would be furloughed. But, in its first three days of operation, applications for 3.2 million workers have come in. So yes, demand for the scheme is huge. But is take-up lower than we thought? We should consider that possibility but personally I think it’s too early to tell. I wouldn’t be surprised if five million people were on the scheme by the end of its first week. HMRC’s IT system has held up heroically in the face of unprecedented demand, but inevitably some firms have struggled to get through, some are still grappling with the paperwork, and others may be waiting for the early rush to clear before they apply. Whatever the final take-up the scheme is vitally important: we’re talking the difference between Britain facing merely tragically high unemployment, or depression-era levels of joblessness.Top of the Charts