As Texas recovers from its winter energy crisis, hard hit consumers and retail power providers may be facing potential bankruptcies caused by the extreme price fluctuations experienced during the cold. The New York Times describes the plight faced by consumers who may face energy bills in the thousands. And retail power companies that supplied power to consumers may also be in trouble due to being forced to buy energy on the spot market at inflated prices, while not being able to pass the full cost to consumers, as covered by Bloomberg. [NYT; February 20, 2021; Bloomberg; February 16; 2021]
Ben Casselman with the New York Times breaks down the most recent U.S. Census Bureau retail and food services data in this Twitter thread. Retail sales are up 8% from their pre-COVID levels. Restaurants, however, while showing a significant rebound from the lowest sales levels, still lag significantly behind. [Ben Casslman via Twitter; February 17, 2021]
Low yields and high demand in the U.S. corporate debt market has caused some investors to focus on China, with comparatively higher yields, as reported by the Wall Street Journal. The default rate, which was already high for the market in 2020, is expected to remain high in 2021. [WSJ; Feb. 16, 2021]
The McKinsey Global Institute is taking a close look at the post-pandemic economy and specifically, the impact COVID will have on labor demand, the mix of occupations and workforce skills required in eight countries. McKinsey predicts that three trends that were accelerated by the COVID pandemic (namely remote work, e-commerce and automation / artificial intelligence) will continue to impact labor, resulting in as many as 25% of workers needing to change occupations by 2030. The sectors most likely to be impacted are those for which physical presence is a large part of the job (e.g., health care, retail, leisure). [McKinsey Global Institute; Feb. 18, 2021]
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