Why another round of stimulus might be needed
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TIAA CEO Roger Ferguson was our guest on this week’s episode of Leadership Next. Ferguson is stepping down from the helm of the $1.2 trillion money management company next March, but he’s been in the news lately as a potential appointment in a Biden administration. While he didn’t make the first round draft choices, my guess is he’ll eventually end up back in government—perhaps as the first African-American chair of the Federal Reserve Board.
We asked Ferguson about the economy, and whether we were headed toward another economic downturn. His answer:
“The overall economy is roughly 3% or so smaller now than it was at the end of last year, and certainly many sectors are still struggling. And even though the unemployment rate has come down, we still have 10 million Americans unemployed and we are worried about long term unemployed….
“So I do think the odds of a double dip seem to have gone up, and I would encourage Congress and the new administration to think very seriously about another round of stimulus.”
He also talked about how the pandemic has increased inequality:
“This series of crises that we’ve seen…a health crisis, an economic crisis, and a racial justice crisis…have all highlighted the deep inequities that exist across many dimensions. To me the most telling statistic is that African Americans make up approximately 13% of the population but approximately 23% of those who have died from COVID-19.”
Also this morning, Fortune editors are releasing their annual Crystal Ball predictions for 2021. Wondering where the S&P 500 will end the year? Or what the price of oil will be? Or which billionaire is going to buy an NFL team? Check out the answers, here.
DeepMind, the Google-owned artificial intelligence company, has completed an almost 50-year-old scientific quest: it's created an A.I. system that can quite accurately predict the complex shapes of proteins using just the information from their genetic sequences. The implications for medicine are enormous—it will now be possible to look at a DNA mutation and quickly predict how it changes a protein's behavior. Fortune
As many as 25,000 retail jobs are at risk in the U.K., following the collapse of Philip Green's Arcadia group. Arcadia itself represents 13,000 jobs, including at outlets such as Topshop and Miss Selfridge, but its collapse then triggered the breakdown of JD Sports' potential rescue of department store chain Debenhams—Arcadia was Debenhams' biggest concession operator—so that's another 12,000 people potentially out of work. BBC
Unilever, the Anglo-Dutch consumer goods multinational, is carrying out an experiment in New Zealand: its 81 employees there will only work four days a week, while being paid for five. The aim is to see if the system, which has been promoted by New Zealand Prime Minister Jacinda Ardern, brings "material change" to the way employees work, as "the old ways of working are outdated and no longer fit for purpose." Fortune
The U.S. government has been paying out less than it should to millions of workers during the COVID-19 pandemic, according to the Government Accountability Office. The watchdog warned of an impact on gig-economy workers and the self-employed, who don't normally receive jobless benefits but are supposed to be supported by the Pandemic Unemployment Assistance program. The GAO also said the Labor Department's weekly unemployment reports were inaccurate due to "flawed estimates of the number of individuals receiving benefits each week throughout the pandemic." Wall Street Journal
AROUND THE WATER COOLER
The U.S. Centers for Disease Control and Prevention will have an urgent meeting today to discuss who should be first in line for a coronavirus vaccine, once the drug has been authorized (Moderna is now requesting clearance.) The likely recommendation: frontline health workers and support personnel, plus residents of nursing homes and long-term care facilities. CNN
Amazon and Apple
Want to use a fully-featured Mac mini, but don't have the desk space? Amazon and Apple have you covered—as part of a new partnership, Amazon Web Services is now offering developers the opportunity to build and test their Mac and iOS apps on a cloud-based Mac mini (an actual one, not a virtualized version.) The service is pricier than some smaller competitors, but AWS obviously gets to offer a bunch of other cloud services alongside the Mac mini offering. TechCrunch
With just one month of the Brexit transition period left, and with the possibility that there won't be a trade and customs deal in time for the new year, British factories are stockpiling raw materials and racing to complete orders before the EU-U.K. borders become a serious issue. So that's a manufacturing uptick now, but a potential disaster just round the corner. Reuters
The S&P 500 has eerily tracked 2009's path this year—the market dips and recoveries have been very similar, with deviations lasting only a few days. So, what's coming this month? If the echoes continue, expect bumpy progress. Fortune
This edition of CEO Daily was edited by David Meyer.