• Meeker Drops Surprise Coronavirus Report
• Government Close to Deal on $450 Billion “Top Up”
• Shake Shack Gives Government Money Back
• 2020 Shaping up to Be a Real Jean Shorts Kinda Year

 ECONOMY 

Meeker Drops Surprise Coronavirus Report

The Marvelous Mary Meeker dropped a 29–page Report on how the coronavirus is shaping economic activity, consumer behavior, and technology over the weekend. (And it’s shaping it into a big old turd.)

Meeker is best known for the annual Internet Trends Report: an intimidating 300–slide PowerPoint presentation that clues in investors and corporations on the defining internet trends of the year. (Your 14–year–old niece could probably fill you in just as well but she wouldn’t be as polite.)

This is like when Kanye suddenly drops an album no one knew about. But, y’know, for nerds. The report was published by Axios on Friday, as I began my terrible transformation from Weekday Shane into Shane With a Beer in My Hand. (It’s like a werewolf thing except scientists aren’t as jazzed to talk to you about it.)

One of the key takeaways from the report is that the virus will permanently change the world of business. But its effects may be less impactful than previous epic viruses because of advances in information sharing and scientific technologies.

(For example, if sufferers of the black plague had just stayed inside and watched Tiger King, they wouldn’t have spread the virus to all their friends and killed one–third of the planet’s population.)

Due to everyone being forced to work in their pajamas and drink beer whenever they want, Meeker says we’re seeing an acceleration of the existing trend of moving business online.

“Many of these offline–to–online trends have been in place for a while,” the report says. “Covid–19 just accelerated them.”

Even after the lockdown orders have lifted, and we’re free to return to licking doorknobs and sneezing in each other’s mouths, some businesses may opt to adapt the work–from–home model permanently.

After all, taking your business online would save a bunch of dough on rent, allow your company to tap a global talent pool, and I wouldn’t have to politely look at photos of babies and pretend to be interested. (WE ALL WOULDN’T HAVE TO LOOK AT PHOTOS OF BABIES AND PRETEND TO BE INTERESTED.)

The longer this crisis drags on, the more businesses will be impacted by the economic fallout from the virus. But the report predicts that on–demand food–delivery services will emerge from this whole pain in the ass stronger and more in–demand than ever before.

“[Instacart and DoorDash] have experienced surging demand and are aggressively bringing on new workers,” the report said. “Net, we believe on–demand and to–the–door delivery services may be gaining permanent market share in these unusual times.”

Blue Apron (APRN), a meal kit delivery service who’s stock crashed and burned spectacularly last year, is up more than 84% year–to–date. (Because there’s no better time to learn to cook than at the end of civilization as we know it.)

 BUSINESS 

Shake Shack Gives Government Money Back

Burger chain Shake Shack says it will give back the $10 million small business loan it took from the government because all this negative press sucks and it has plenty of dough anyway.

In a blog post this morning, CEO Randy Garutti said the frozen–fry company (I don’t care if they’re crinkle cut, they suck) will return the $10 million loan earmarked for small businesses as it was able to find an alternative avenue for raising funds.

Last week, Shake Shack raised about $150 million in an equity offering, which is an impressive amount given that Shake Shack is a mom–and–pop operation with only one location… hold on, now that I recheck my figures, Shake Shack has 189 restaurants in the United States, with 45 employees in every outlet.

As the cartoon Italian man on the front of every pizza box ever would say, “That’s–a big a small–a business, eh?”

Shake Shack is the first major corporation to return the small business loan it received under the Paycheck Protection Program. But it is by no means the only large company taking advantage of a loophole that lets big businesses slurp up funds allocated for mom–and–pop establishments.

Currently its unknown exactly who applied and received relief. But more than 25% of the $350 billion program went to just 2% of the companies that got relief. And you know Janice’s Raw Kombucha Stand and Turquoise Emporium ain’t taking $10 million loans from the government.

Daniel Day Lewis in his Oscar–winning performance as Ruth’s Chris Steak House

The $350 billion package dried up almost immediately after applications opened, leaving thousands of American businesses without the much–needed funds to weather this crisis (and now we know why). But the government is putting together emergency legislation that would add a top up to the scheme with another $310 billion. (More on that below.)

 ECONOMY 

Government Close to Deal on $450 Billion “Top Up”

The Trump administration is close to a deal with lawmakers that would “top up” the $2.2 trillion coronavirus economic relief package with an extra $450 billion. (Maybe we should just put the government’s credit card on auto–renew and charge it an extra $450 billion every two weeks until this thing is over.)

Treasury Secretary and stock photo of a dad who doesn’t think the family is ready for a dog Steve Mnuchin said he hopes to reach a deal by the end of today and send it to the House for a vote as early as Wednesday.

The “top up” would send an additional $310 billion to the Paycheck Protection Program, which was sucked dry last week as major corporations abused a loophole that allowed them to suck up funds allocated for small businesses.

The remaining funds would be allocated to hospitals and expanding coronavirus testing across the country. Right now, the only state meeting the CDC’s testing requirements is Rhode Island. (And the only thing Rhode Island should be #1 at is “not driving for longer than 20 minutes.”)

Notably, the bill includes zero funding for state and local governments, whose revenues have been slashed during the pandemic. (If a single person got a parking ticket right now, the entire country would riot.)

In Other News

(Source: Manchester Evening News.)

ONE LAST THING

2020 Shaping up to Be a Real Jean Shorts Kinda Year

The S&P 500 is on track to post its worst quarter since I let my hair grow out and asked everyone to call me “The Shane Man” (2009 was a bad time for everyone).

First–quarter earnings for companies in the S&P 500 are on track to decline 14.5% from a year ago, the biggest decline since the 15.7% plunge in Q3 of 2009, according to data compiled by FactSet.

While an optimist might look at those figures and say, “Hey, at least it’s not as bad as that time Shane bought jean shorts,” experts warn we’re just seeing the tip of the iceberg.

As Stephen Hoedt, managing director of equity and fixed income research at Key Private Bank, told Market Watch, these results won’t even show the half of damage.

“[B]ecause the COVID–19 pandemic wasn’t taken seriously until early March, less than a third of the quarter was impacted by various lockdown orders across the globe,” Hoedt said.

MARKET MOVEMENTS

Closing Data for Today

• Facebook is rolling out the Facebook Gaming mobile app today to compete in the booming global games market.

• The Trump admin will allow some companies to delay payment of import tariffs to ease the economic hardship triggered by the coronavirus.

• Italy’s Treasury expects its economy, the third–largest in the EU, to contract by around 8% this year.

Cheers,

Shane Ormond
Editor, One Last Thing

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