Previewing The Next Crisis: Spending Tumbles Among Households Cut Off From Unemployment Benefits First, the good news. As we first observed one month ago and as we confirmed on Thursday, the debate – inasmuch as one ever existed – is now over: jobless claims, both initial (as Morgan Stanley shows)… … and continuing (as shown just a few days ago by Goldman)… … are tumbling in Republican states which have ended emergency covid benefits ahead of their official end in September, while barely budging in Democrat states which hope that government handouts will last forever, just like in all socialist success stories in the history of the world. The message here: republican states are well on their way to normalizing the most fractured and broken labor market the US has had since World War II, one where there are 9 million job openings and over 12 million people collecting jobless benefits (and refusing to look for a job) thanks to Biden’s generous handouts. Still, the transition back to a normal job market will be a painful one, and one where the jump from full handouts to full employment will be accompanied by a sharp drop off in spending and which may well spark the next (2 month) recession. Which brings us to the bad news. Total card spending based on the aggregated BAC credit and debit card data shows that as one would expect, states where generous government handouts have ended are seeing a sharp drop in spending, especially among the unemployed. As Bank of America notes, in the states where benefits were cut, spending was weaker for the cohort receiving UI as compared to those not getting benefits. For comparison, BofA ran this same exercise for the other states that did not allow for UI expiration: there was a

This article was originally published by Radio Free Europe/Radio Liberty and is reprinted with permission. A Russian hacker considered to be one of the world’s most notorious spammers was sentenced by a U.S. judge on July 20 to time already served in pretrial detention. Pyotr Levashov has already served 33 months in custody on federal charges he operated a network of hijacked computers — known as botnets — to steal computer credentials, distribute spam, and install malicious software. The 40-year-old pleaded guilty in 2018 to causing intentional damage to a protected computer, conspiracy, wire fraud, and aggravated identity theft. U.S. District Judge Robert Chatigny said the financial harm caused by the spamming was overstated in a presentencing report that recommended a sentence of at least 12 years. But the judge acknowledged that the crimes developed into something serious and sophisticated. “It goes without saying that somebody that builds and operates botnets, as you did, and profits from making them available for use by cybercriminals should expect to be prosecuted and punished,” he said. “Because, indeed, this is significant criminal conduct that is harmful to the public.” The judge also ordered Levashov to serve three years of supervised release. It’s unclear if or when he will be deported to Russia. Levashov, who has been out of prison on electronic monitoring since January 2020, apologized to the court for his actions. He was arrested in April 2017 while vacationing in Spain. Russia fought his extradition, but Levashov was eventually transferred to the United States. A botnet is a network of computers infected with malicious software that allows a third party to control the entire computer network without the knowledge or consent of the computer owners. Since the late 1990s until his arrest, Levashov controlled and operated “multiple” botnets that, combined, could send